The global Voice over Internet Protocol (VoIP) market was valued at $43.3 bn in 2016 and is forecast to grow at a robust CAGR of 10.2% between 2017 and 2024, culminating to global revenue of $93.9 bn by 2024.
Industry at a Glance
The global VoIP market is on rising on account of benefits including low-cost communication, inexpensive data rates and the presence of a strong network infrastructure. Snowballing adoption particularly by Small & Home Offices (SOHO) is another major factor driving market growth significantly over the next few years. Additionally, the industry is witnessing an upcoming trend of moving to a completely Unified Communications (UC) environment and VoIP is considered as the first step towards this evolution.
VoIP has also emerged as a service particularly for small and midsized businesses that are actively seen moving towards public cloud owing to lack of finances or capital investment. In addition, with the flourishing bring-your-own-device (BYOD) trend, mobile VoIP is gaining traction. VoIP provides convenience primarily to employees who work from home or are regularly traveling.
The industry is also witnessing the use of dedicated VoIP networks, real-time antivirus software, and enhanced data encryption as means to improve security thereby eliminating the risk of Denial of Service (DoS) attacks or data breach.
“Optimal Price Point (OPP) for VoIP”
Estimated average VoIP cost – $ xx globally. However, with improving access and availability of options, OPP and range of acceptable Prices (RAP) are going to change. We at Ameri Research continuously track these prices with our proprietary pricing model.
The market success is encouraged by the US Federal Communication Commission decision of not controlling or limiting the voice circulation over the Net, and low cost of these services. With little barriers to entry, the rivalry is rapidly growing instigating companies to offer improve quality, differentiated services, and reduce prices.
Access Type Overview
By access type, the market has been segmented into phone-to-phone, computer-to-computer, and computer-to-phone. Phone-to-phone access type segment dominated the market in terms of revenue share and is anticipated to witness robust growth over the next few years owing to increase mobile device penetration worldwide.
By medium, the market is classified into mobile and fixed. Mobile VoIP accounted for more than 50% of the overall revenue share in 2016. The segment is also anticipated to flourish over the next few year on account of the rapid increase in smartphone and other mobile device penetration worldwide. Widespread usage of social media applications in another factor driving segment growth.
User Type Scenario
Based on user type, the market is categorized into domestic and corporate. Corporate segment held more than 60% of the overall revenue share in 2016 and is expected to witness substantial growth over the forecast period. This is attributed to the introduction of BYOD policy across the corporate sector allowing users or employees to push the use of VoIP to act as a single point of contact regardless of who’s calling or where they’re calling from.
Industry Vertical Trends
By Industry Vertical, the market is segmented into BFSI, healthcare, education, government, retail, and media & entertainment. BFSI and government collectively account for more than 35% of the overall market share in 2016 closely followed by healthcare and retail. VoIP offers faster, easier, and less expensive communication medium thereby stimulating companies to call clients more frequently.
Based on region, the market is classified into North America, Europe, Asia Pacific, Latin America and Middle East & Africa. North America captured more than 35% of the overall revenue share in 2016 and is expected to witness substantial growth over the forecast period. This is attributed to the large presence of early technology adopters in the region. Asia Pacific emerged as the fastest growing regional market owing to the snowballing use of high speed communications (such as 4G) and modernization of network infrastructure.
Growth Drivers & Restraints
Prominent growth drivers residing in the global VoIP market include mounting usage of new services over various network, growing internet penetration, and technological advancements. Additionally, manufacturers are actively striving to shift from traditional telephony using GSM or CDMA technology towards VoIP services expanding cellular networks such as 3G and 4G.
Low public acceptance of VoIP services primarily in the residential consumer segment is a major factor restraining market growth over the forecast period. Further, limited customer choices paired with low service quality are among other challenges hindering market growth.
Merger & Acquisition Insights
Mergers & acquisitions are seen as primary growth strategies followed by leading industry participants in an attempt to enter emerging markets, enhance global presence and penetrate deeper into the already established markets. For example, in November 2015, Jive Communications acquired Easy Office Phone and Intercity Telecom acquired Imerja.
Top Players & Company Share
Leading industry players include AT&T, Deutsche Telekom, Korea Telecom, Orange, Sprint Nextel, Telecom Italia, Telenor, Verizon, and T-Mobile. Major companies emphasize on investing substantial amount on R&D activities to develop technologically advanced solutions to outperform their competitors in such as highly competitive environment.
Voice over Internet Protocol Market, by Access Type (Revenue, USD Billion)
Voice over Internet Protocol Market, by Medium (Revenue, USD Billion)
Voice over Internet Protocol Market, by User Type (Revenue, USD Billion)
- Small Medium Enterprises (SMEs)
- Large Enterprises
Voice over Internet Protocol Market, by Industry Vertical (Revenue, USD Billion)
- Media & Entertainment
Voice over Internet Protocol Market, by Region (Revenue, USD Billion)
- North America
- Asia Pacific
- Latin America
- Middle East & Africa
- Saudi Arabia