As more and more residences and small businesses gain access to the internet via broadband connections, the number of VoIP consumers is sure to grow. Providers are working to overcome the key disadvantages such as call quality and 911 service availability. If the residential and small business VoIP providers want to mount a serious challenge against the Baby Bell’s traditional phone service, then they will have to develop a mechanism to deliver ubiquitous 911 service.
The greatest issue facing the current residential and small business focused VoIP providers is the last mile issue. In most households there are 2 conduits by which broadband telephony services can enter the home. The first is the copper phone line. The second is cable. The major VoIP providers today utilize these entry points into their customer’s homes. As the industry begins to move in this direction, it is clear that the major cable television providers as well as the Baby Bells will begin to offer VoIP service. It seems likely that this will inevitably lead to the current players getting pushed out of the market.
Phone services for medium to large businesses today are either proved by a Baby Bell or by what is known as a facilities based competitive local exchange carrier (CLEC). CLECs were born from the 1996 Telecommunications Act. That act of congress forced the Baby Bells to open their local networks to competition. The CLECs quickly began building out traditional telephony networks that interconnected with the Bells and the long distance companies.
CLECs will likely be the first movers in bringing VoIP services to medium to large businesses. This is for 2 reasons. First CLECs have much less infrastructure and as such are in a better position to move to a VoIP Network than the Baby Bells. Second, in order to survive CLECs will have to be focused on building networks that are extremely efficient. The bells will also need extremely efficient networks to survive, but for the most part the bells have a longer period of time before their cash will run out. The efficiencies of VoIP are key to the CLECs being around long enough to go toe to toe with the Bells.
While many medium and large businesses have made significant investments in traditional telephony equipment, both the CLECs and VoIP equipment providers are looking for solutions that will enable these businesses to leverage these assets and still gain many of the benefits that VoIP provides. A device called an Integrated Access Device (IAD) allows business to connect their voice and data networks into this one device. This one device is then connected to a CLEC’s VoIP network. In addition to acting as a router for the data traffic, the device converts the analog voice signals to digital for outbound voice calls, and it converts digital to analog voice signals for inbound calls.
One of the more interesting VoIP markets is in the wireless arena. The idea is that as wireless internet “hot spots” become available in more places, people will want to utilize wireless VoIP phones to make calls from within these “hot spots”. At this point in time, the only thing that could possibly be worse from a call quality perspective than a wireless call would be a wireless VoIP call. However, if wireless broadband access to the internet becomes as widespread as traditional cellular service, IP will likely become the standard protocol voice transmission in that medium for the same reasons it is poised to become the standard for wire based voice services.
All that being said, according to an article by Robert
Jaques on
The key issues that will drive the acceptance of VoIP in the wireless world will be the ease of transition between traditional mobile phone service and VoIP, the cost associated with owning the handset, and perhaps most importantly, the quality of the voice communication over the VoIP networks. Unless transition is ubiquitous, handset costs fall, and quality improves, this will be a difficult hurdle to overcome.