Telcos to lose $386b from OTT VoIP: Ovum

Enterprise Innovation editors
28 Feb 2014

Telecom operators will lose $386 billion between 2012 and 2018 from customers using OTT VoIP solutions such as Skype and Microsoft Lync, according to Ovum.

The analyst firm said these losses will mostly come from international call revenues, including roaming.

Ovum forecasts show that the consumer OTT VoIP market is thriving, with traffic expected to grow by a CAGR of 20% between 2012 and 2018, and to reach 1.7 trillion minutes in 2018.

This growth is being driven by improvements in the availability and speed of broadband networks; the growing sophistication, affordability, and capability of smartphones and computers; and the rise of social media.

If the current trajectory is maintained, Ovum expects telcos to lose $63 billion in voice revenues in 2018 alone as customers use free OTT VoIP solutions.

“Unfortunately, telcos must learn to live with this reality. The use of VoIP will grow increasingly over the next five years to become the underlying technology for delivering voice over telecom infrastructure,” says Emeka Obiodu, principal analyst at Ovum.

“Blocking these services, entering into alliances, or trying to out-compete OTT players using services such as Joyn, are not going to stem the OTT VoIP tide,” he added. “Instead, we encourage telcos to neutralize the price arbitrage that makes OTT VoIP services appealing.”

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