VOIP spurs global phone competition

The main driving force for the growth of international VoIP (voice over internet protocol) remains to be its low price.
This was the result of a study made by research firm TeleGeography.

According to TeleGeography, broadband-based VoIP services to homes and businesses can include additional features like click-to-dial and a choice of area codes. The call quality of VoIP has also markedly improved. But new features and quality are not the main motivations for international VoIP. A majority of VoIP calls are made to countries in the developing world, using conventional phones as a way to bypass regulated termination charges for circuit-switched calls. VoIP, in effect, is only used to bring calls from one traditional network to another.
The growth of international VoIP traffic reached 35 per cent to 30.8 billion minutes in 2004. Even though the growth rate has declined from more than 100 per cent per year in the early days of the technology, the usage has been increasing. If trends continue from the first six months of 2005, the full year will see international VoIP use increase 38 per cent.
The three countries that has topped the list for VoIP growth in 2004 were Nigeria, Brazil, and Bangladesh, according to the report. It also observed that VoIP traffic has been growing the fastest in places where the telecommunications market has recently been deregulated. Making calls using the Internet bypasses international termination charges. Thus, the entry of competitive carriers that can handle incoming VoIP calls provides an alternative that can actually save callers more than 50 per cent over traditional circuit-switched phone call minutes. This means more hours spent talking with one’s children and other loved ones.