IP Telephony

VoIP services might in some cases be a replacement for legacy wireline voice. But that doesn’t mean VoIP users behave the same way as legacy voice users do. Long distance calling is a bigger component of VoIP user behavior, for example.

 

Service providers worldwide recorded an estimated traffic volume of 351.5 billion VoIP minutes during the fourth quarter of 2007. After eliminated double or triple counting (where a minute of use is counted both by wholesale and retail providers) actual unduplicated traffic volume was around 322.8 billion minutes, according to researchers at iLocus.

 

Most of the calling was, as you might expect, of the "long distance" sort: 221.3 billion minutes. There also were 81.7 billion "local" calling minutes consumed. About 19.8 billion international long distance minutes also were consumed. That's quite a different pattern from legacy voice calling patterns.

 

In the U.S. market, the overwhelming percentage of calls from traditional wired phones has been "local," with the vast majority of all calls terminating within 1,000 miles of any phone's location. Wireless users have roughly the same pattern. According to Federal Communications Commission (FCC (News - Alert)) data, about 81 percent of all wireless calls in 2005 originated and terminated within the same State. Calls of an "interstate" nature represented just 15 percent of calls. No more than four percent were international long distance calls.

 

Measured by minutes of use, 70 percent of calls originated and terminated within the same State while 28 percent of minutes used were interstate. Less than two percent of minutes were international.

 

That clearly isn't the pattern for VoIP callers, where it is international long distance that is the driver.

 

Traditionally, consumers have made about 33 to 46 percent of wired telephone long distance calls, dropping from the 1995 level of 46 percent down to the 2004 level of 33 percent. In the traditional wired phone market, businesses have been making more and more of the long distance calls, over the last decade.

 

Consumers, on the other hand, arguably drive usage of VoIP services.

 

About 77.9 billion of the reported minutes are "retail" VoIP, while 3.8 billion are "wholesale local VoIP"  (white labeling and termination for small providers), according to iLocus.

 

Of the local retail VoIP traffic, North America has 38.2 percent, EMEA 42.5 percent, APAC 18.3 percent and CALA one percent.