Global IP telephony revenues increase almost fourfold

The annual global revenues from retail IP telephony* services grew from $1,834 million in 2005 to $6908 million in 2006. Western Europe alone, which has the largest number of IP subscribers, produced $2639 million in revenue.

The Asia-Pacific region with almost the same number of subscribers (about 14.5 million) generated $1750 million, estimates analyst company Point Topic. North America, third in terms of IP user subscribers (8.6 million) produced $2411.7 million in revenue.

Monthly average revenue per user (ARPU) for VoIP subscribers was highest in North America at $20. Western Europe and South and East Asia were comparable at $15 while in both the Asia-Pacific and Latin America it was estimated at $10.

“The more VoIP is offered as a part of a bundle of services, the higher the average monthly VoIP revenue is,” says John Bosnell, Senior Analyst at Point Topic

The main targets for IP telephony are heavy telephone users and consumers from markets where the service can offer a significant price advantage. The single bill convenience of having one supplier for broadband telephony and digital TV is another selling point.

Point Topic projects that in the medium term an IP telephony service will be expected by consumers from their broadband operators in the same way a TV and broadband bundle is expected from cable operators. As the price differential is eroded by competition, additional features will come on stream including the option of multiple lines with no call blocking, the simplicity of a single access line, and, in the long term, the possibility of completely free on-net calls.

Residential customers may also start to enjoy some of the benefits of corporate VoIP services. Their IP telephony service will be integrated with their home network, offering them the equivalent of the Private Branch exchange (PABX), access to computer databases for setting up and logging calls and the benefits of Session Initiation Protocol (SIP) technology for applications such as handling multimedia calls.

“In the longer term it is likely that IP telephony will start to dominate the residential telephony market as is already beginning to happen in the corporate sector,” says Bosnell.

*Point Topic defines IP telephony as a service that emulates the voice service provided by the ordinary telephone network as fully as possible over internet protocol (IP) connections. IP telephony is one of a whole range of services that use voice over IP (VoIP) technology in some form.

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For more information and associated charts and tables, please contact:

Point Topic: Oliver Johnson
Email: oliver {at} point-topic(.)com
Tel. +44 (0) 20 7812 0506

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