VoIP players stake their claims

11/05/2004 - 22:00

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COMPETITION is likely to intensify within the voice services sector in the latter half of this year as several players begin to drive the battle into the residential Voice over Internet Protocol market space (VoIP).

COMPETITION is likely to intensify within the voice services sector in the latter half of this year as several players begin to drive the battle into the residential Voice over Internet Protocol market space (VoIP).

Telco giants Telstra and Optus, along with some smaller players, are already actively marketing their VoIP solutions in the corporate space – predominantly offering IP telephony solutions over corporate virtual private networks (VPNs).

However, analysts predict Telstra and Optus will be dragged into the residential VoIP market when competitor offerings begin to chisel away at their voice margins.

In WA, iiNet has been just one of the national players tackling the potentially lucrative residential VoIP market. Perth-based Swiftel (through its now-parent company people telecom) and Sydney-based Comindico are other examples of smaller players that have announced an intention to roll out residential VoIP offerings this year.

iiNet has been busy trialing a residential VoIP solution in Perth and, at the end of February this year, more than 2,000 new clients had signed up for the service.

The company is moving ahead with plans to go live with its DSL infrastructure and enabling technology (DSLAMs) later this year.

“We are presently trialing VoIP equipment with the intention of offering a VoIP product to customers later this year,” iiNet managing director Michael Malone said.

“We’re a good deal more advanced on this.

“iiNet has its own DSLAMs in the Pier Street and Cannington exchanges, and we are in the final days of vendor selection.

“Assuming the trials are successful, which is now looking very good, we intend to roll out our own DSLAMs to a small number of exchanges in areas where we already have a high density of customers.

“That will mean most exchanges will initially be in Perth.”

IDC analyst Landry Fevre said the take-up of residential VoIP was closely tied to the take-up of broadband across Australia.

The lack of broadband infrastructure and the slow-but-steady take up of offerings such as DSL remained one of the primary reasons Australia lagged behind countries such as Japan in the area of residential VoIP, he said.

Nevertheless, Mr Fevre remained bullish about the VoIP market, including the residential VoIP offerings planned for general consumption later in the year.

“Residential broadband could be really taking off,” he said. “I think it will happen towards August or September this year. There are already some offerings [available]”

Mr Fevre said Session Initiation Protocol would enable VoIP for a mass consumer market in a similar way that Hypertext Transfer Protocol (HTTP) enabled the Internet and created mass appeal.

SIP was developed by the Internet Engineering Taskforce as an alternative to H.323, which is currently the industry standard.

While H.323 has been available since about 1996, and is used by major equipment providers such as Cisco, SIP has recently gained momentum following a deal between telecommunications carrier SingTel and US-based technology firm SIPhone.

This deal is expected to allow SIP users to call and receive calls from regular PSTN (Public Switched Telephone Network) phones at significantly cheaper rates.

“SIP will definitely be the standard in the residential market,” Mr Fevre said.

“Why? Because Microsoft is using it in MSN Messager already.”

Meanwhile, Mr Malone observed that any major changes in attitudes to new technology had come not from business, but from consumers and the mass market.

He said the same could be said for the growing interest in VoIP.

“It has never been B2B or B2C, it has been email, file transfer, ICQ, IIC, SMS,” Mr Malone said.

“They [consumer offerings] are always the things that bring new technologies to the mass market.”

Mr Malone said iiNet was working on how to bundle VoIP for the residential market.

“There is no guarantee that what is successful in one market, will be successful in another,” he said.

“[However,] if you put in a compelling data package when charging voice, then you’ve got a compelling bundle.”

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