VoIP solutions take on traditional telephony

Traditional telephone companies are seeing profits fall, partly due to the increase in adoption of VoIP phones and other alternatives.

Top telephone companies' revenue growth is in decline because of the recession, roaming and termination rates regulation and competition from the likes of the VoIP carrier community, Ovum has said.

While the recession has quickened this decline in income, these challenges "won't disappear just because the economy picks up", Clare McCarthy, principal analyst at the telecoms industry analyst firm, said.

However, fewer than eight per cent of consumers surveyed by Datamonitor, Ovum's parent company, said they would definitely reduce telephone-related spending, signifying that telecommunications are no longer seen as dispensable.

Of those surveyed, 30 per cent said they will look to reduce their mobile phone bill, while almost a quarter will consider cutting costs related to landlines.

Ovum forecast that traditional telephone companies will look to offer over-the-top services, such as IP telephony solutions, to consumers as they emerge from the recession.

Mobile network operators could compensate for falling voice revenues by forming partnerships with the VoIP provider community, Juniper Research said recently.