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Mobile VoIP vs. Static VoIP

08 Apr 15

The VoIP market has changed drastically since mVoIP applications were introduced into the market.

When various applications were commercially launched in the APAC region in 2011, the global VoIP market has seen a radical increase in the number of subscriptions, according to a report by Visiongain, an independent business information provider for the telecommunications industry.

However, the drastic increase on the number of VoIP subscriptions brought by these mobile applications has not yet achieved sustainable revenue growth, as they lack credible monetisation models and are expected to face severe competition.

The report says that up until now, the mVoIP market has been in a race to the bottom in which the effectiveness of the market is measured in terms of active subscribers but not in terms of revenues.

mVoIP providers have been able to disrupt the global telecommunications market by providing not only free OTT services, but also platforms that create higher customer engagement and provide more diverse revenue opportunities than standard voice and SMS services.

Contrastingly, static VoIP operators have not seen such a dramatic change in their number of subscriptions. Instead static VoIP market size and revenues have been growing at stable and healthy rates. But more importantly, this submarket is responsible for more than 96% of global VoIP revenues and these are expected to grow steadily in the next five years.

Due to the current disruption that telcos face all around the world, Visiongain says it expects incumbent operators to struggle at competing directly with OTT providers.

“This can be witnessed in the way telcos are applying pressure to create regulatory changes against OTT providers,” it says. “One of these battles is being fiercely fought in the US as ISPs look to create a two tier internet whilst internet companies fight back against this anti-competitive initiative.”

On the contrary, Visiongain says more forward-looking telcos will understand the importance of embracing OTT providers and cooperating with the disruptors, in order to improve their service offerings and stop the erosion of ARPU. Others, especially those operators in the most developed markets will compete directly by offering VoLTE as the only way to increase ARPU and restore their lost market share from OTT providers.

Overall, Visiongain says the global VoIP market is far from reaching maturity as in reality there are only 10 countries in the world that could be characterised as mature VoIP markets.

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