Study: Cable VoIP makes gains on Vonage

Wed, 10/26/2005 - 8:00pm
Karen Brown, CED

VoIP will have a bigger voice in the North American market with an 18-fold increase between 2004 and 2009, according to the latest estimates from Infonetics Research.

The Boston-based research firm estimates the VoIP sector will grow in that period from $1.24 billion to $23.4 billion, with more than $62 billion spent on VoIP services.

"VoIP subscriber growth is skyrocketing right along with revenue growth: We're forecasting triple-digit growth from 2005 to 2006, with 6 million new subscribers a year every year from 2006 to 2008, when there will be over 24 million," said Kevin Mitchell, principal analyst of Infonetics Research and author of the report.

In the residential and small office/home office markets, Vonage Inc. still has the lead, but its share is at the lowest mark to date because of increased competition from cable companies, Mitchell added. Vonage now holds 32 percent of the market, down from 36 percent in the first quarter of 2005. Coming in at second place is Time Warner Cable with 25 percent of the market, up from 21 percent at the beginning of the year, followed by Cablevision Systems Corp., which now claims 19 percent, down from 21 percent in early 2005.

Cablevision and Time Warner Cable have seen double-digit share growth, and combined, they claim more than 40 percent of the North American residential VoIP subscribers.

Infonetics also expects incumbent telcos will have a greater impact in the coming years, as they shift from legacy switched voice services to VoIP "because triple-play services will all be based on broadband infrastructure, and legacy PSTN access will continue to slowly churn away," Mitchell noted.


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