An assortment of information, discussions,events, news and views on VoIP Services.

Thursday, May 22, 2008

RBOCs continue to have lower customer base as VoIP scales newer heights

The spread of VoIP across the United States is certainly on a high these days. Accroding to data released by TeleGeography's US VoIP Research Service, the three US Regional Bell operating Companies (RBOC's), namely AT&T, Verizon and Qwest have lost 17.3 million residential subscribers between Q1 2005 and Q1 2008, while cable companies and VoIP service providers have increased their user base by 14.5 million.

While VoIP has certainly been one of the major adversaries of landline companies, it is cable operators who have actually stolen the show this time around (For more info, check out my blog on Comcast) with their Triple Play programmes that include voice video and internet services, hence the reason that cable companies account for 80% of US IP telephony numbers. RBOCs on the other hand are continuously suffering losses. The example of Qwest is a most appropriate one. Reportedly, the company has lost 195,000 customers and about $83 million in the first quarter of 2008. While Verizon and AT&T have begun to work on their providing their own range of offerings based on the Triple Play model, Qwest apparently is not doing anything to prevent the situation from arising again.

Even when we shift our focus from VoIP, cellphones too have had a significant impact on the so-called 'extinction', if you will, of landlines in the US. According to the Centers for Disease Control,(Yes, it's true. Even I was shocked to see such stats revelad by something as wierd as the CDC!) at least 16 percent of US households have one or more cellphones, but no landlines.

Assessing the situation at a closer level, it is very clear to see why such a shift in telephony subscription is taking place. While landline telephones do, and would always continue to, have an edge over VoIP telephony due to a few technical knick-knacks, VoIP does prove to be indispensible in case of long distance calls. Applications such as Skype and Globe7 have indeed been very succesful in the last 3-4 years. Further, the triple play program being offered by cable companies is obviously very lucrative, since it combines internet access along with voice and video services. While the existence of landlines can nither be negated nor avoided, RBOCs have to come up with something fast if they are to remain a dominant force in the telecom sector.

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