Free article: 3G LTE will create the business case for
mass-market wireless VoIP
The capacity, cost per megabyte and quality of service of existing 3G
cellular technologies, including high-speed packet access (HSPA) and
CDMA2000 1× evolution data only (EV-DO) Revision 0 are not yet adequate to
justify many mobile operators moving to cellular VoIP services. However,
CDMA2000 1× EV-DO Revision A and W-CDMA long-term evolution (LTE) will bring
cost benefits and new service opportunities that trigger the mass migration
of mobile operators from circuit-switched voice to voice over Internet
protocol (VoIP).
Mobile operators will invest in EV-DO Revision A and W-CDMA LTE for the
delivery of data-intensive services, such as mobile TV and broadband
Internet access, as well as VoIP services, so the cost of these new
technologies will not have to be recouped through VoIP alone. Once these
radio technologies are in place, mobile operators will be able to position
cellular VoIP as a premium voice service, offering high-quality calls and a
range of value-added features, such as presence information, instant
messaging and multimedia sharing. This will help mobile operators to resist
the erosion of voice prices and to justify an on-going price premium
compared to fixed and alternative wireless voice services.
Cellular VoIP will begin to appear in the USA from 2007, when
SprintNextel and Verizon implement EV-DO Revision A across their networks,
while, as shown in Figure 1, cellular VoIP will grow strongly in Western
Europe from 2009, following the widespread introduction of W-CDMA LTE.
Figure 1: Annual voice minutes carried by fixed and
wireless networks in Western Europe, 2006–15
By 2015, cellular VoIP will carry 28% of total
fixed and mobile voice minutes in the USA and 23% in Western Europe. In
Western Europe, cellular VoIP will carry more traffic than all fixed voice
services (circuit-switched and VoIP) combined.
Mobile operators need to start planning now for the
transition to VoIP services. As well as the evolution of their radio
networks, they need to consider migration to all-IP core networks and the
introduction of VoIP-enabled handsets. They must also manage the threat of
alternative VoIP services on WLAN or BWA networks, as well as that of third
parties offering VoIP on the operators’ own cellular data services.
Our new report,
Forecasting the
Commercial Impact of Wireless VoIP in the USA and Western Europe,
discusses the factors that will define when wireless VoIP services become
significant and forecasts the impact of wireless VoIP on the overall market
for fixed and mobile voice services, in terms of voice minutes and revenue,
over the period 2006–2015. The report considers the relative importance of
VoIP over cellular, WLAN and BWA technologies and identifies the barriers
and enablers to the success of each.