Cellular VoIP in the USA and Western Europe will generate more revenue than all fixed VoIP services by 2012

Analysys: 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.Following the upgrade of CDMA2000 1× 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. 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.

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

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. Operators must also manage the threat of third parties that offer VoIP on operators’ own cellular data services, as well as competitors that offer alternative VoIP services on WLAN or BWA networks.

The factors that will define when wireless VoIP services become significant. The impact of wireless VoIP on the overall market for fixed and mobile voice services over the period 2006–15, both in terms of voice minutes and revenues. The report considers the relative importance of VoIP over cellular, WLAN and BWA technologies and identifies the barriers and enablers to their respective success. Forecasting the Commercial Impact of Wireless VoIP in the USA and Western Europe Publ 20060918