VoIP Stealing Thunder from Fixed Connections

    August 24, 2005
    Chris Crum

The Organisation for Economic Co-operation and Development (OECD) has released a new report forecasting the doom of the fixed-connection phone industry.

Maybe doom is a strong word, but the OECD says that the fixed-line revenues are threatened by VoIP, as it gains popularity, and land lines lose theirs.

VoIP To Take Over?

As mobile phones continue to gain in popularity as well when compared to land lines, VoIP threatens their revenues too.

“VoIP presents a challenge to mobile telephones, which in many countries are now more numerous than fixed connections,” said the OECD. According to Light Reading,

In 2003, for the first time ever, the number of fixed phone lines actually fell in OECD countries, with mobile operators gaining market share at the expense of the traditional telecoms companies, a trend which continued in 2004 and 2005. As for Internet telephony, a comparison of the cost of calls via Skype, a VoIP provider, and via traditional fixed-line carriers in OECD countries revealed an average saving of 80% using Skype, according to the OECD report. On a per capita basis, Denmark, Poland and the Netherlands are the largest users of Skype.

I would assume that land line services will have to go down in price to stay competitive with the VoIP industry.

Chris is a staff writer for WebProNews. Visit WebProNews for the latest ebusiness news.