BASINGSTOKE, England, --March 17th 2004-- A new report from industry analysts, Juniper Research, finds that the VoIP market will become the key revenue generator for broadband service providers by 2009, contributing to an overall value-added services market of $47bn. This will be in addition to the $43bn spent on broadband access in the same period.
Ian Cox, Broadband Specialist at Juniper, said “Broadband penetration has now grown to a level where the industry is on the verge of a revolution, as it is now economically attractive to launch value-added services to a mass audience”.
The challenge to service providers will be to provision these new services as cost effectively as possible as traditional revenue streams from existing fixed-line voice services continue to decline. Flat-rate IP based voice tariffs will gradually replace time and distance related tariffs. These declines may, to a certain extent, be off-set by a reduction in operating costs for converged networks.
BROADBAND VALUE-ADDED SERVICES
Residential Sector ($bn)
$0.60 $2.90 On-line Games
$0.41 $2.12 Music Downloads
$0.80 $5.71 Video Services
$2.48 $6.36 Voice-over-IP
$4.29 $27.10 Total
Business Sector ($bn)
$0.31 $2.92 Online Data Storage
$2.67 $5.28 Web Hosting
$0.55 $2.36 Virtual Private Networks
$1.01 $9.53 Voice-over-IP
$4.54 $20.09 Total
Although much attention has been paid to the more complex and ‘sexy’ value-added services like video-on-demand and on-line games, it appears that the biggest opportunity will be in voice services as broadband IP-voice takes over from traditional circuit-switched voice; driven by lower operating costs and competition between incumbents and new licensed operators.
· Service providers need to take advantage of the opportunity provided by broadband value-added services to protect their profitability and move as quickly as possible to a converged network.
· Equipment vendors need to have in place fully integrated systems in order to provide truly ‘one-stop’ shop solutions to providers.
· Content providers need to prepare for this on-going revolution by re-purposing and protecting their content for digital distribution, or risk losing market presence.
White papers and further details of the study ‘Broadband Added Value Services: Business & Residential Opportunities’ can be freely downloaded from http://www.juniperresearch.com. Alternatively please contact Michele Ince at firstname.lastname@example.org, Telephone +44(0)1256 345612.
Juniper Research provides research and analytical services to the global hi-tech communications sector, providing consultancy, analyst reports and industry surveys.
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