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VoIP's gonna be huge

And don't telcos know it

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VoIP is going to be massive. The effects of internet telephony are touching technology, business, culture, geographic penetration and consumer expectations in a way that is certain to turn the telecoms industry on its head.

So says Benny Last, MD of telco IDT Europe. Earlier this week he spoke about the impact of VoIP (Voice over Internet Protocol) on the global telecoms industry.

He told delegates at the Carriers Conference in London that traditional voice providers "will need to make additions to their service offerings beyond voice" if they want to continue to compete in this new telco world order.

"Enhanced offerings will include Internet broadband access, media, IPTV [TV over the internet], online gaming, messaging...as well as 'next gen' services. They must enhance their service offerings because that is precisely what VoIP makes possible," he said.

With VoIP operators springing up all over the place effectively piggybacking on broadband networks, traditional telcos will have to adapt or risk losing out.

"Traditional voice providers will need to get more creative with pricing models as voice becomes one service offering among many," he said.

"Bundled pricing is likely to predominate. In addition, minutes and distance as factors in pricing will become more and more foreign to consumers accustomed to IP networks...who will expect to pay for access to services, and then pay incrementally for frills."

He went on: "VoIP is here, and it is not going away. We are in the midst of an explosive change in the way people use technology.

"While the size of VoIP traffic and underlying service provider networks may currently be modest, and the industry refers to VoIP deployment as 'evolutionary' rather than 'revolutionary', VoIP is acquiring significant mindshare all over the world," he said.

Last's assessment of the future of VoIP comes as a separate piece of research claims that the world's largest telcos are increasingly hopping on the VoIP bandwagon. The main reason is the fear of losing punters and seeing a drop in revenues, according to research from Heavy Reading.

More than 170 telcos including BT, AT&T and Verizon were quizzed as part of the research, which predicts a surge in VoIP traffic over the next two years.

"The single biggest reason for deploying VOIP is fear that traffic would otherwise migrate to competitors' networks," said Graham Finnie a senior analyst at Heavy Reading. ®

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