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VoIP will be big, but revenues won't

Business IT - Technology

Market researcher, Market Clarity is forecasting 4.8 million VoIP services in Australia by 2011, but says that VoIP will account for only a very a small proportion of total telecommunications revenue.

It forecasts that more than half of the revenue generated by Internet-based VoIP services in 2011 will come from business users. "The more lucrative 'private network' VoIP service market will reach 730,000 services by 2011, with close to 90 percent of revenue attributed to business customers."

Market Clarity CEO, Shara Evans said: "While increased customer loyalty may justify a free VoIP service for ISPs or telecom service providers, pure-play VoIP providers need to work on revenue generation...Even though Internet-based VoIP is expected to generate revenue of close to $85 million in 2006-2007, this represents very low ARPU for a population which will approach 1.4 million users in the same period."

However, of Australia’s 1.1 million Internet-based VoIP services in December 2006, only 230,000 were paid services.

Market Clarity also highlights the growing importance of the hosted IP telephony (IP centrex) market. "With revenue of over $118 million in 2006, this market is worth more than twice the Internet-based VoIP market," it says. "By 2011, hosted IP telephony could become a powerhouse worth more than $750 million per annum," it predicts.