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Cellular VoIP will Generate More Revenue Than All Fixed VoIP Services
18th September , 2006

Above : Annual voice minutes carried by fixed and wireless networks in Western Europe, 2006–15

Europe : By 2012, cellular VoIP services are forecast to generate revenues of USD18.6 billion (EUR15.3 billion) in the USA and USD7.3 billion (EUR.6.0 billion) in Western Europe, compared with fixed VoIP revenues of USD11.9 (EUR9.8 billion) in the USA and USD6.9 billion (EUR5.7 billion) in Western Europe, according to a new report, Forecasting the Commercial Impact of Wireless VoIP in the USA and Western Europe, published by Analysys.

Following the upgrade of CDMA2000 1x Evolution Data Optimised (EV-DO) networks to Revision A from 2007, and the upgrade of W-CDMA networks to 3G Long Term Evolution (LTE) from 2010, there will a compelling case for mobile operators to migrate their voice services from circuit-switched voice to voice over Internet Protocol (VoIP).

"The capacity, cost per megabyte and quality of service of existing 3G cellular technologies - including EV-DO Revision 0 on CDMA2000 networks and High Speed Packet Access (HSPA) on W-CDMA networks - are not yet adequate to support a significant move to wireless VoIP services," notes the report's co-author, Mark Heath. "However, EV-DO Revision A and 3G LTE will respectively create the cost benefits and new service opportunities that trigger the migration to mass market cellular VoIP."

Key findings from the new report include:

1. By 2015, cellular VoIP will carry 28% of all fixed and mobile voice minutes in the USA and 23% in Western Europe

2. Mobile operators will position cellular VoIP as a premium voice service, emphasising quality of service and a range of value added features (such as presence information, instant messaging and multimedia sharing) in order to resist the erosion of voice prices

3. Cellular VoIP will dominate the mix of wireless VoIP services in developed markets, with VoIP over wireless local area networks (VoWLAN) and VoIP over broadband wireless access (BWA) technologies (such as WiMAX) relegated to niche roles.

According to report co-author, Alastair Brydon, mobile operators need to start planning for the transition to VoIP services now, "Operators need to consider the migration to all-IP core networks and the introduction of VoIP-enabled handsets, as well as the evolution of their radio networks."
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