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VoIP Penetration Steadily Increases
Pent-up demand for integrated telephony and business applications will drive adoption through 2013, according to new research findings.
Posted May 28, 2009
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Given the number of products or services offered by the typical company, it's hard to expect a customer service representative (CSR) to have innate knowledge of every inquiry that may flow into the contact center. Unfortunately, the people who are topic experts often aren't CSRs, and when CSRs reach out to them, they tend to be hard to get hold of at the moment they're needed. As a result, many companies have long desired a seamless connection between their personnel -- unified communications (UC) -- in order to improve the customer experience. According to a new report from Campbell, Calif.–based information technology consultancy Infonetics Research, Voice over Internet Protocol (VoIP) and hosted UC offerings may bring those desires closer than ever to realization, with worldwide revenue for hosted UC services expected to double between 2009 and 2013.

According to Diane Myers, a directing analyst at Infonetics, the biannual "VoIP and UC Services and Subscribers" report defines UC as a core comprising an integrated mailbox, contacts, and a communications device with presence capabilities. The hosted side of UC services is primed for significant growth due to its lack of upfront capital expense. "Most small-to-midsize businesses don't have the capital -- human and monetary -- to manage and maintain [on-premises] UC," she says.

The acceptance of Microsoft Exchange Server as an industry standard, Myers says, has also helped more companies feel safe entrusting their email systems to an outside provider. "The outsourced option makes a lot of sense," she says. "Businesses wanting to have the product and cost advantage of having an integrated solution can go hosted."

The continued growth of VoIP in the past year has also helped support increased adoption of hosted UC services, Myers says. According to the study, the VoIP services market grew 33 percent, to $30.8 billion, in 2008. While the overall market is largely dominated by the residential side -- with mainstream offerings such as digital voice and bundled packages from providers of telecommunications services -- Myers says that the rate of growth in business VoIP service last year outpaced that of residential VoIP service.

One reason for the disparity in the rates of growth may be that the market for VoIP among businesses has seen far less penetration to date than the market for residential VoIP has -- a relative lack of penetration that only begs the question: Why are businesses late to the VoIP party? Blame poor marketing and a lack of education, Myers says. "It's more a matter of awareness," she says. "A lot of companies aren't aware [VoIP is] an option…and that's a challenge. Residential cable operators have done a great job of marketing it -- on the business side, that just hasn't been the case."

The Infonetics projections, however, suggest that a critical evolution in the communications world may unfold over the next few years. Myers says that the statistics essentially say that VoIP is here to stay, and that it's quickly becoming the rule rather than the exception.

Telecommunications companies, in other words, that fail to include some form of VoIP in their offerings going forward will likely face significant customer-retention issues. "If you look in the not-so-distant future, VoIP is going to reach an inflection point in which more traffic will go over VoIP than [over] circuit switch," Myers says. "That's the story." Even so, she adds, the mobile-service alternative remains a perpetual temptation. "If operational/service providers don't embrace the move or offer a broad portfolio of VoIP services, users will go to mobile."

News relevant to the customer relationship management industry is posted several times a day on destinationCRM.com, in addition to the news section Insight that appears every month in the pages of CRM magazine. You may leave a public comment regarding this article by clicking on "Comments" at the top; to contact the editors, please email editor@destinationCRM.com.

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