Wireless VoIP Threatens Telco Business

The combination of wireless and Internet calling will force traditional mobile-phone companies to adapt as sales of dual-mode handsets rise, a report says

Traditional phone operators will be forced to change their approach as wireless VoIP technology surges over the next few years, say analysts.

Sales for wireless VoIP tech for both dual and single mode devices are forecast to generate global revenues of $82bn by 2012, according to a report by Juniper Research.

Basharat Hamid Ashai, author of the report, told silicon.com: "VoIP is dramatically changing the service provider market. With the advent of VoIP over wi-fi, it will cause providers to rethink how they retain customers."

Ashai added wireless VoIP will reduce demand for landlines, leaving the door open for non-traditional carriers, such as internet or DSL providers, to sell voice services.

He said: "The marriage of VoIP and wireless technology has gained a lot of attention in the last couple of years, with many industry experts believing it to be the next killer application to revolutionise the telecoms space."

Juniper predicts dual-mode handsets - both cellular and wireless-VoIP enabled - will lead wi-fi VoIP sales, contributing around $68bn in revenue. By contrast, single mode handsets will only generate revenue of $1.5bn, due to high pricing of the phones themselves.

Ashai said: "The dual-mode handset market is in its infancy right now but this technology is prepared to revolutionise the wireless VoIP market."

He said the handset market is moving to a stage where no one wants to carry two or three devices in their pocket, and the ability to have a single device for all calls is a "compelling proposition".

Dual-mode phones are currently offered by established mobile manufacturers Motorola and Nokia, along with Fujitsu, HP and NEC. More than 100,000 handsets were shipped between July 2005 and June 2006.

Juniper also predicts wireless mesh technology is become more important for use with VoIP. Mesh tech is already used to provide connectivity in sports stadiums and emergency vehicles.

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