What Issues Do VoIP Companies Face?
VoIP undoubtedly has revolutionised the way many people use their phone icluding how long they spend on it. It would also be accurate to say the emergence of VoIP technology also got some of the Telecoms giants feeling the heat. So is VoIP going to take over? Will fixed landlines become an archaic symbol of yesteryear?. It seems that there are several barriers which when looked at together, may possible prove insurmountable. For this reason I will suggest that far from being an unstoppable force, perhaps VoIP is on its last legs.
It’s becoming increasingly clear that something being hugely popular and used my millions of people doesn’t necessarily mean that it will make a lot of money. This has been illustrated with both Skype and Facebook as they struggle to find a way of making money. The problem with Skype as with other VoIP operators is the parasitic nature of their relationship with the incumbent telecoms operators. Much in the same way as a parasite is dependent on its host to live, so too VoIP operators find themselves at the behest of the Telecoms giants whose networks they need for survival.
Lack of any tangible fixed assets poses a huge hurdle for VoIP operators, where the competitive nature of the market has also meant prices are tending towards zero. To attract any outside capital or investment, any potential investor needs something more to invest in than the purely the brand. As is the case with some mobile VoIP operators such as the fledgling mobile VoIP operator Truphone having some proprietary technology of their own has meant they have been able to get hold of funding. However without being able to generate a sizeable income the likelihood they will be able to build their own network is highly unlikely.
It was not too long ago that T-Mobile took action against Truphone illustrating VoIP operators’ vulnerability. In this instance the courts took action to prevent T-Mobile from blocking calls to numbers which had been allocated to Truphone which perhaps can be seen as a ray of hope for the future of Voice over IP. It seems that the {aggressive posturing of Hutchison Wampoa, which owns the 3 networks has been more successful, effectively removing the possibility of widely available Wi-Fi, arguably signalling the end for Skype.
How things will progress remains to be seen but it seems like the incumbent telecom operators may just be starting to fight back.
