Internet telephony presents a major challenge to telecom operators’ current business model, according to a report from British telecommunications consultant firm Analysys Ltd.
The report, entitled “Commercial Strategies for Internet Telephony,”
profiled companies now entering the telephony markets, and discussed
critical issues facing incumbent operators, new entrants,
Internet Service Providers (ISPs), cable TV operators and IT vendors.
The report predicted that telephony could take 36% of the online market on
key international routes by 2003, and offered advice to firms on how to
deal with the growing industry. Companies can ignore it and risk having to
buy up the competition later; they can join the competition now and gain early
market share; or they can move up the value chain by exploiting the
value-added aspects of Internet telephony, the study explained.
“For established operators that own and operate circuit-switched networks,
a major barrier to
their entering the Internet telephony market is the potential to
cannibalise their traditional revenues
and profits from existing services,” said Margaret Hopkins, author of the
report.
A recent report by SRI consulting noted that telephony will be a $9 billion
business by 2002, which may quell the fears of some hesitant participants.
