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Carrier Investment in VoIP is Strong, Report Finds

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February 24, 2014

Carrier Investment in VoIP is Strong, Report Finds

By Mae Kowalke, TMCnet Contributor

Carriers are investing in VoIP because it is clear: IP communications are the future.

With 4G LTE (News - Alert) infrastructure finally starting to catch up with demand, the industry is rapidly investing in voice over LTE (VoLTE). This is both due to pressure from over-the-top (OTT) solutions such as Skype and WhatsApp, which is eating into profits, as well as added efficiency and service offerings that come with VoLTE technology.

The carrier VoIP and IMS market gained 30 percent in 2013, according to a recent Infonetics report, highlighting investment in the space.

Overall, worldwide service provider VoIP and IMS equipment revenue totaled $3.7 billion in 2013, according to the report. Spending was particularly strong in the U.S., China, and Japan, where the mobile markets are large and operators are competitive. All major regions posted strong growth last year, however.

Fixed-line transformation projects also continued growing as IP has continued to take over the telecom space, with spending on class 5 replacement and voice over broadband (VoBB) and Session Initiation Protocol (News - Alert) (SIP) trunking expansion being strong, the report said.

In particular, large equipment manufacturers have done well.

“The market for carrier VoIP and IMS shined in 2013 as mobile operators ramped for voice over LTE (VoLTE), and Huawei, Alcatel-Lucent, Ericsson (News - Alert), and NSN rode the wave, each putting up impressive 20 percent year-over-year growth,” noted Diane Myers, principal analyst for VoIP, UC, and IMS at Infonetics Research (News - Alert), in a statement.

“Though there’s still room for pure-play vendors and product specialists,” she said, “the large equipment manufacturers benefit from long-standing relationships with mobile operators and broad product portfolios that extend well beyond carrier VoIP and IMS.”

But really all VoIP-centered firms with an innovative product are benefiting from the investment in VoIP.

REVE Systems, for instance, a mobile VoIP provider, was recently named one of Red Herring’s (News - Alert) Top 100 global companies. The Singapore-based firm has been having success all around, especially with its iTel Switch Plus.

The company’s iTel Switch Plus solution is a carrier-grade softswitch that features multi-level reseller support, easy end user interface, integrated billing, and class 4 &5 softswitch features. By offering innovations such as the option to have an infinite number of reseller levels and never-go-negative balance protection, the company is well positioned for the VoIP growth as firms of all sizes make the move to IP.

Infonetics predicts that the growth seen in 2013 will level off a bit this year thanks to the heavy investment in 2013, but even still there should be healthy growth numbers for companies such as REVE Systems and Alcatel-Lucent come this time next year. VoIP is hot.

Edited by Stefania Viscusi

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