3 mln residential VOIP users by year-end 2005, 27 mln by 2009

Residential voice over Internet Protocol (VOIP) has clearly come into its own in the US as major telecommunications carriers begin to roll out VOIP service offerings to give themselves a competitive edge. Fueled in part by consumers looking to add value to their telephony service, IDC expects that the number of US subscribers to residential VOIP services will grow from 3 mln in 2005 to 27 mln by the end of 2009. Although it has been slow to develop in the US and elsewhere, VOIP is finally beginning to show its potential in the consumer market. Much of the recent success is the result of marketing VOIP services on the basis of price. However, carriers will need to educate residential users on the features and functions of VOIP service to avoid a pricing war. Integrating applications and enabling convergence are critical capabilities that carriers will need to offer in the years ahead.