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A mass migration to alternative telephony is forecast over the next five years, with a quarter of Western European households expected to ditch their landlines.

By 2010, mobile and Voice over Internet Protocol (VoIP) services will account for more than 60 percent of residential voice spend in Western Europe, according to a new report from Analysys.

The research firm predicts that around 25 per cent of households will have abandoned traditional telephony services offered via the Public Switched Telephone Network (PSTN) by 2010 in favour of cheaper options.

"The mass market for voice services in Western Europe is being transformed by the substitution of mobile and new VoIP services for traditional fixed voice services," said Katrina Bond, lead author of the report. "We expect that in five years 45 per cent of voice minutes will be made from a mobile or VoIP connection, compared to 28 per cent in 2004."

According to the study, so-called "Plain old Telephony Services" (POTS) will account for just 39 per cent of declining spend on residential voice services by 2010.

The report reveals that there has already been substantial fixed-mobile substitution in Western Europe. Mobile networks accounted for 51 per cent of voice spend in 2004; in 2010 mobile voice services are expected to account for 35 per cent of voice minutes and 57 percent of voice spend in 2010.

"The usage of broadband connections for VoIP is at a nascent stage in Western Europe currently, but the scene will change dramatically over the next five years," said Bond. "In 2010, it is estimated that VoIP could account for 9.6 per cent of voice minutes, but only around 3.6 per cent of voice spend because of its low price compared with POTS services."

The report points out that consumers' spend on voice services will decline as a percentage of disposable income because falling prices for all voice services will enable spend to be transferred to other services or uses of time.

© ENN

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