International Privatization Boosts IP Telephony Markets - Industry Trend or Event

Cambridge Telcom Report, Jan 31, 2000

International deregulation and privatization of the communications industry are helping to usher in a range of new telecommunications services and technologies.

In this technology-friendly environment, the Internet Protocol (IP) telephony market is already the fastest-growing segment in the telecommunications industry.

According to Frost & Sullivan's ( www.frost.com ) latest strategic research, "Global IP Telephony Service Markets," the IP telephony market grew from $60.7 million in 1998 to $263.7 million in 1999 and is projected to exhibit impressive revenue growth through 2006.

VoIP enables voice transmissions over Internet connections, thus bypassing public switched telephone network (PSTN) tolls for long-distance calls. By providing a cost-effective alternative to long-distance calling, IP telephony is projected to be the most significant advancement in telecom since wireless communications.

As public switched telephone network (PSTN) rates continue to decline, value-added features will take on an increased significance for VoIP.

"Unified messaging, presence management and click-to-talk applications for call centers are currently the most prominent enhanced applications," says Frost & Sullivan Telecommunications Industry Analyst John Cha. Recently introduced Internet call waiting and virtual second-line applications will be added to this list.

"Mobile telephony services are planning to utilize VoIP technology for the next generation of networks," Cha says. Internet access will be integrated into wireless handsets, giving users new features and allowing wireless service providers to offer enhanced services.

"Many wireless networks are already based on packet-switched technology, so evolving to IP should be a natural step forward," Cha says. Because mobile phone use is rising rapidly, the introduction of IP over wireless will significantly impact the growth of the VoIP market.

"Global IP Telephony Service Markets" analyzes the markets for IP telephony services in North America, Europe, Latin America, Asia Pacific and other regions. It presents critical market information that is unique to each region, including demographics, teledensity and economic conditions. It also evaluates market drivers and restraints and examines industry challenges.

Frost & Sullivan presents 1999 Market Engineering Leadership Awards to companies that have worked hard to make a positive contribution to the IP telephony field.

The Leadership Award is given to Net2Phone, the Customer Focus Award goes to Rapid Link, the Marketing Strategy Award is presented to iBasis, the Business Development Strategy Award is given to ITXC and the Entrepreneurial Company Award goes to oCen Communications.

Frost & Sullivan is an international marketing consulting and training company that monitors the IP Telephony industry for market trends, market measurements and strategies. This ongoing research complements a series of research publications, such as No. 9509D "VoIP Services Subscription," and supports participants with customized consulting solutions. "Global IP Telephony Services Market" Report: 7159-61 Publication Date: February 2000 Price: $3,950