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VOIP for Business

By TelcoMarch, 2007May 21st, 20243 min read

More than I can recall for the last ten years, we find our industry at a stage of disruptive change. New products like VOIP and HSDPA are threatening to totally change the telecommunications landscape, and do so at all levels.

From a vendor perspective (carrier, service provider, technology provider), this is awfully scary. It’s hard enough to predict where things will be in two or three years at the most stable of times in the telecomms world.

Recent research shows major shifts ahead in the VOIP world. We have already seen technologies like Skype and Jajah threaten to cause a mass exodus from traditional telcos.

This is all about “product substitution”. What is on offer to customers is a fundamental change to the way they communicate. As an example, in the fixed-to-mobile substitution scenario, which has been happening here for some time already, customers are asked the question: “do you really need your home/fixed phone?” and many are chosing to abandon it in favour of just a mobile.

With VOIP and other new technologies, the same question is being asked: “are you prepared to change the way you communicate?” To do something different than pick up a handset, dial a number, and have someone answer it at the other end.

So now, the question is: how quickly might customers change, and which customers are most prone to change. The answer, of course, depends on the particular proposition put to the customer. In the case of fixed-to-mobile, the substitution would especially appeal to someone who is never home and always reliant on their answering machine, or a “road warrior” who is never at their desk in an office.

Now consider the equivalent in the VOIP situation: who is most likely to be prepared to change, or be early adopters? Well, it is clearly those who have already voted with their feet – the mass market, low ARPU, residential customers. They are the ones who have embraced Skype, Vonage, and Engin, and are on the cusp of throwing out their fixed phones completely.

But what about business customers? Well, there are a raft of business VOIP offerings, from the likes of Powertel, and recently Optus have thrown their towel into the ring. But it’s important to consider that businesses have very different telecommunications needs to residential customers. In fact, you could easily segment businesses (as carriers do) in to a handful of categories, each with their own (very different) needs and constraints.

My view is that businesses will not be running to disruptive technologies and changes to their IT&T infrastructure, and will not migrate en masse until there are simple, proven, and comprehensive solutions that deliver both voice and data, and do so with a smooth transition. This is something not yet available here, and which may take some time to evolve.

What is your experience in this market sector?

This was also posted at [Billing Bureau].

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