Government Technology

Report: Broadband Telephony Will Nearly Double Between 2007 and 2013



July 8, 2008 By

JupiterResearch projects that the broadband telephony market will nearly double in size from 14.7 million subscribers in 2007 to 28.4 million lines in 2013. Cable operators will see most of this increase, with their VoIP subscriber base nearly doubling during the forecast period, while growth for over-the-top VoIP providers will stagnate. The emergence of new service offerings, such as those from AT&T and Skype, will continue to generate buzz within the market.

The report, US Broadband Telephony Forecast, 2008 to 2013, cable multiple system operators (MSOs) have maintained momentum in the voice service market by continuing to focus on competitive triple-play service bundles. Of consumers who subscribe to a cable MSO-managed VoIP service, 47 percent said bundling had a strong influence on their selection of home phone service provider.

As noted by David Schatsky, president of JupiterResearch, "Broadband telephony enables fixed service providers to integrate voice service features with other bundled services such as broadband, TV or wireless. At a time when consumers are increasingly cutting the cord and relying solely on wireless for voice communication, broadband telephony offers the best opportunity for fixed service providers to retain current voice customers or acquire new ones."

Despite having a moderate impact on the VoIP market overall, the emergence of AT&T's U-verse Voice is an important market development. "By rolling out a managed VoIP service in areas where it already offers circuit-switched voice service, AT&T validates the importance of integrated services across the bundle," explained Doug Williams, analyst and lead author of the report. "However, AT&T may find it challenging to migrate existing voice customers to the VoIP platform, as those consumers place greater emphasis on service quality and reliability when selecting a home telephone service provider."

Looking ahead, JupiterResearch observes a few wild card scenarios that could shake up the market for broadband telephony, namely the potential for Verizon to migrate all services including voice within its FiOS bundles to an IP platform, as well as new product offerings such as the Skype phone, which de-couples Skype's voice chat service from the PC, and T-Mobile's new "@Home" over-the-top VoIP offer for $10 per month.

See a video by the New York Times' David Pogue on the future of telephones.


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