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VoIP phones set to drive $24 billion business

Posted: 13 Sep 2005 ?? ?Print Version ?Bookmark and Share

Keywords:voip equipment? wireline?

The number of residential Voice over Internet Protocol (VoIP) users is expected to increase over the next years, causing market revenue for wireline VoIP equipment to more than triple from 2004 to reach $24.5 billion in annual revenue in 2010, according to iSuppli Corp., a market research company.

In 2005, at the start of a period of explosive growth, worldwide VoIP equipment revenue is set to rise by 60 percent compared with the preceding year to $12.9 billion, iSuppli (El Segundo, Calif.) said.

The number of residential VoIP subscribers worldwide is predicted to rise to 197.2 million in 2010, up more than 40-fold from 4.8 million in 2004. This level of growth would help drive worldwide sales revenue from wireline VoIP equipment to $24.5 billion in 2010, more than three times the $8.04 billion in sales in 2004.

Thereafter the market is set to grow to $15.3 billion in 2006, $18.1 billion in 2007, $21.1 billion in 2008 and $22.1 billion in 2009, iSuppli said.

The VoIP equipment market consists of products targeting the residential, enterprise and other segments. These products range from the enterprise-oriented, such as IP-oriented private branch exchange (PBX) equipment, IP-phones and enterprise media gateways, to residential-oriented cable modems, xDSL voice and media gateways and soft switches.

The residential segment is set to be the fastest growing portion of the VoIP equipment market, with revenue expanding to $10.6 billion in 2010, up 650 percent from $1.4 billion in 2004, iSuppli predicted.

"Worldwide, there are more than 1 billion wireline subscribers generating in excess of $450 billion in voice revenues annually," noted Steve Rago, principal analyst, networking and optical communications for iSuppli, in a statement. "The goal of every incumbent telephone company is to hold on to its share of the voice revenue stream, while the focus of all cellular companies, cable operators and virtual voice providers is to grab a major share of this revenue stream for themselves. The battle for the voice dollar will be a major driver of the growth of residential VoIP subscribers."

The market research company predicts Japan and the Americas region will continue to dominate the residential VoIP subscriber market during the coming years. At the end of 2004, the three nations together accounted for 83 percent of the total residential wireline VoIP subscribers. By 2010, these countries still will account for more than half of all residential VoIP subscribers at 56.4 percent.

- Peter Clarke

EE Times

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