Service providers' business VoIP revenue offsets sluggish residential growth, says Infonetics

As residential VoIP services like Vonage and Magic Jack remain sluggish, service providers are finding new revenue opportunities in the business segment, one that Infonetics said helped offset residential declines.

Consisting of 38 percent of overall VoIP services sales, business VoIP service revenue grew 9.7 percent in 2014 over 2013.

Two of the key drivers in the business VoIP market are managed IP PBX and cloud-based hosted PBX and Unified Communications services.

Infonetics said that managed IP PBX services will make up the largest segment of business VoIP services for the next several years, with new growth coming from dedicated cloud unified communication solutions.

Likewise, the ongoing demand for enterprise cloud-based services, hosted PBX and unified communication service revenue increased 8 percent year-over-year in 2014, and seats rose 30 percent.

Diane Myers, research director for VoIP, UC and IMS at Infonetics Research, now part of IHS, said that the growing interest in voice services like SIP trunking and the movement to the cloud are what is fueling businesses' interest in adopting VoIP services.

"Business voice services are the driving force within the VoIP services market as the move to IP positively impacts cloud, trunking and managed services across all business segments," Myers said in a release. "Larger enterprises in particular continue to actively evaluate cloud unified communications while also migrating to SIP trunking for premises-based deployments."

That's not to say that residential VoIP subscriber additions are necessarily declining. The research firm reported that there were 224 million residential VoIP subscribers worldwide in 2014, up 5 percent from the previous year.

Myers said that residential VoIP "subscribers continue to grow, but revenue has fallen off as VoIP services are included in triple-play packages for almost no cost in many parts of the world."

Overall, the worldwide VoIP service market reached nearly $70 billion in 2014, up 3 percent over 2013, with business VoIP services being the key growth driver.

For more:
- see the release

Related articles:
CenturyLink proposes TDM-to-IP transition trial in Las Vegas
VoIP, unified communications to grow to $88B market by 2018, says Infonetics

Suggested Articles

Like most telcos, there are challenges ahead for CenturyLink, but one area it can bank on is its fiber network both here and abroad.

With the surge of data-hungry gamers battling for the best experience, how will your network rise to the challenge?

Listen now.

It's going to be fun watching the epic battle unfolding between hedge fund giant Elliott Management and massive conglomerate AT&T.