VoIP retail offers experience strong growth in Germany - but still very far away from mass market

Stuttgart, Germany - 21st January, 2005 - The number of VoIP retail customers, driven by the launch of many new offers, more than quadrupled between June and December 2004 in Germany. However, an estimated 350 000 VoIP customers still represents only around 5% of the overall number of broadband customers in Germany at December 2004.

We feel that none of the market drivers are currently really compelling, i.e. basically that VoIP does not represent much added value for most consumers, neither in terms of extra services nor in terms of better prices. VoIP, based on IP-PBX, for internal communications for companies has a higher and more immediate potential. But for consumers, VoIP does not provide in effect any fundamentally new benefits, unlike mobile phones for instance. Besides, issues regarding quality and reliability will further limit the potential of VoIP in the foreseeable future. So, in the medium term we do not see VoIP becoming mass market, but remaining limited to a proportion of broadband customers who are early adopters or cost conscious heavy telephone users. Furthermore, in the short to medium term, regulatory decision regarding the classification of VoIP as PATS (Publicly Available Telephone Service) or not, will also have a significant impact on the growth of VoIP. Naturally, in the really long term, with new technologies resulting in quality improvements and with increasing population penetration of PCs and broadband access, VoIP will become more significant.

This market outlook comes from InfoCom’s continuous VoIP monitoring service.


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