Telcos to lose US$18bn to VoIP by 2011

A new report suggests that established telcos could lose over five per cent of their business to innovative technologies like VoIP over the next five years.

The study, by research firm Analysys, claimed that services like Skype will account for five per cent of telecoms revenues by 2011, amounting to US$18.2bn.

Although the use of such services is still limited, demand is strong and the technology is easy to use, according to the research.

"Online communities and portals create a market for communications that occupy a middle ground between one-to-one and one-to-many interactions," said Stephen Sale, author of the Opportunities for Non-traditional Players in Communications Markets report.

"The success of many of these services calls into question established ideas of user behaviour, and suggests alternative means of addressing the communications market.

"Non-traditional players can capitalise on their presence online and in end-user devices to make inroads into telecoms companies' core revenues."

The VoIP market received a strong boost recently when the Federal Communications Commission announced that VoIP players should have the same rights as established telcos.

The Analysys survey also predicts strong demand for services such as on-demand video, which it estimates will be worth US$820m in five years' time.

Digital music will be worth US$4.3bn by 2011, according to the report. Nearly two thirds of this revenue will go to online portals, leaving mobile and direct-to-consumer services with only modest market share.