OTT VoIP to cost telcos $479b to 2020

Jeremy Green/ Ovum
02 Aug 2012

Reports of the death of the telephone have been somewhat exaggerated. While telephony revenues continue to fall, voice traffic is shifting rather than collapsing.

The long-term trend in the telecom industry is towards a richer and more complex communications environment in which voice serves a different function and telephony plays a smaller role.

Declining revenues are mainly due to falling telephony prices, largely a function of market maturity and peer competition rather than the much-feared over-the-top (OTT) VoIP players. OTT VoIP is not about to replace traditional telephony, but it is having a considerable impact on telcos’ revenues.

OTT VoIP will cost telcos $479b over next eight years

Telco voice revenues have been eroded by competition and market saturation. In our report “The Future of Voice” we forecast that overall telco voice revenues (including fixed subscriptions) will decline at a CAGR of 2.4% between 2012 and 2020, falling from $970.4 billion in 2012 to $799.6 billion in 2020.

The impact of OTT VoIP on fixed voice revenues has already been significant, and we expect it will only increase in the years leading up to 2020.

Mobile operators will feel this impact even more acutely than fixed telcos. From 2012 to 2020 we expect that OTT VoIP will cost the global telecom industry $479bn in lost cumulative revenues, which represents 6.9% of cumulative total voice revenues.

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