Voice over Internet Protocol (VoIP) technology has seen massive growth since its inception, particularly from 2007 to 2009. After all, using data networks for conducting phone calls offers a number of benefits, particularly reduced prices. However, in 2010, VoIP growth abated somewhat due to the growing popularity of mobile phones, as residential users decided to go without a home phone of any kind in pursuit of even greater cost savings.
But now, IBISWorld is forecasting that the VoIP industry revenue will grow at an annualized rate of 16.7 percent over the next five years following a 14.2 percent increase to $15.4 billion in 2012. One major factor in this growth is continued business adoption.
“The increasing robustness of the internet will allay fears about VoIP quality and reliability, another major hurdle to adoption by the business segment,” said IBISWorld industry analyst Kevin Boyland in a statement.
Meanwhile, one of the factors that originally drove growth in the VoIP market, bundled cable TV and Internet plans, will continue to be a factor going forward. This has to do with the increased concentration in the VoIP industry in the past five years, leaving the majority of VoIP in the U.S. handled by Comcast, Time Warner Cable, Cox (News - Alert) Enterprises and Vonage. Cable-based VoIP providers have been able to quickly add to their subscribers with bundled service agreements.
Also because of this, cable-based VoIP providers will likely remain the largest players in the industry due to the popularity of cable TV.
Furthermore, VoIP providers are expected to turn the industry's former enemy, mobile, into an ally with increasing attention on mobile applications over the next five years. The increasing reliability of existing and planned 4G wireless data networks is expected to improve mobile VoIP quality, while increasing demand for mobile VoIP.
This isn't much of a surprise as 2012 itself has proven an important year for mobile VoIP with major players like REVE Systems furthering the popularity of mobile VoIP with its iTel Mobile Dialer app.
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Edited by Brooke Neuman