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2.7 Million VOIP Subscribers in the United States

prostoalex writes "There are 2.7 million paying VOIP customers in the United States, according to research by TeleGeography. The whole industry will generate $220 million this year, with Vonage leading as far as customer number."

28 of 116 comments (clear)

  1. What is even more interresting... by nordicfrost · · Score: 4, Interesting

    ...is how many "unpaying" VoIP there are in the US. I, for one, use services that are free, like Skype, to communicate with friends. Skype does have a payment service, but along with my friends I never need it. We kinda fly under the radar.

    I can't imagine that there are just a few of us that use systems like iChat, Skype etc. for voice communication.

    1. Re:What is even more interresting... by Grey+Ninja · · Score: 2, Informative

      I've given bucketloads to Skype for the PC2Phone services. But I've recently moved to voipbuster, where the calls are free... but hang up automatically after an hour. :(

    2. Re:What is even more interresting... by caseydk · · Score: 4, Interesting


      Yeah, I was thinking of that, but even more important:

      220 million/year / 2.7 people = less than $100/person/year

      Seems like pretty low revenue/user. I hope the margins are good.

    3. Re:What is even more interresting... by JPriest · · Score: 2, Informative

      Another possible Skype alternitave is Gizmo they charge more than Skype for calling PSTN but the client UI is pretty full-featured.

      --
      Saying Java is nice because it works on all OS's is like saying that anal sex is nice because it works on all genders.
    4. Re:What is even more interresting... by timeOday · · Score: 2, Interesting
      ...is how many "unpaying" VoIP there are in the US. I, for one, use services that are free, like Skype, to communicate with friends.
      It's not direct IP-to-IP calls that cost, it's the IP-to-POTS bridge.

      That's why it's so annoying that Vonage locks down your IP telephone adapter, so you cannot receive direct IP calls from outside the Vonage network.

      I think they're trying to create an expectation that VOIP should incur a charge over and above normal IP services. There's no good reason for that.

  2. 911? by Anonymous Coward · · Score: 5, Insightful

    Is this still a shortcoming of VOIP? If so, that's a lot of people without a lifeline.

    1. Re:911? by Albanach · · Score: 2, Interesting
      Only if they ditched all their other phones.

      Most houses with VoIP probably still have their landline (for the DSL they use the VoIP over) plus the one, two or three family mobiles.

      Yes,a 911 service needs to be established, though there should be some onus on governments to help here because it's an international problem. If I'm travelling with my laptop my VoIP number comes with me and knows not if I'm in the States, Canada or Europe. Why can't we click a world map to say where we are and give the operators a standard interface so 911 calls can go to the appropriate location?

    2. Re:911? by bn0p · · Score: 2, Informative

      Yes and no.
      Unfortunately it's still mostly yes. Many VOIP vendors, including Vonage, are issuing disclaimers to avoid problems. There was a story recently in the Denver area regarding the death of a baby due to a 13 minute delay in getting the 911 call to an emergency response center in the correct part of town. The carrier (not Vonage by the way) allegedly had the wrong address in their 911 database.

      VOIP vendors will (and probably should) issue disclaimers until they can work out a way to provide 911 service that is as reliable as that provided by the traditional carriers. Given that network and power outages still make VOIP unusable, this may take a while.

      Bottom line: if 911 is important, keep a POTS (plain old telephone service) line. I do.

      Never let reality temper imagination

      --
      Never let reality temper imagination
    3. Re:911? by dattaway · · Score: 3, Informative

      Sure, you can always reach 911, but if it works is another question. Here in Kansas City even with the tax increase for fire and police, 911 is still worthless. You will still reach 911 with Vonage, only to hear "your call is important, do not hang up!" for half an hour before you reach a human. Give another few hours for police to show up if they deem its REALLY an emergency. We approved concealed carry, because 911 is NOT working.

    4. Re:911? by rekoil · · Score: 2, Informative

      Most VoIP customers use cable internet, not DSL. And probably cancelled their land line. I use Vonage on my DSL line, but only because I got the DSL "bare", without having to buy dialtone from BellSouth on the line.

      One factoid: phone companies are required to allow one to dial 911 on any phone line, whether it's active or not. So even if you cancel your phone service, you can still make a 911 call on the pair even if you don't have dialtone. Same deal with cellphones...any cellphone tower will take a 911 call from any compatible (GSM, DCMA, etc) phone in the area regardless of what provider it's subscribed to.

  3. Market Ready for High Quality Now? by ZX81 · · Score: 2, Interesting

    So, now that people are starting to take up VoIP, do you think that people will start to look for the best quality or continue to go for the cheapest price.

    At our company (don't worry we only deal with companies, so this isn't an ad), we have a new routing system that does Least Cost Routing, but with weighting. This allows us to weight providers higher or lower based on their performance/quality.

    While this increases our prices slightly, it does mean that we have pretty good QOS.

    Do you think that as the market progresses this will be something that consumers get or will it always be the domain of large enterprises?

    --
    -={ Security does not exist - give up }=-
  4. Yeah... but the problem is.. by Anonymous Coward · · Score: 3, Insightful

    ..that you "don't matter", since you're "leeching" and not "generating millions for the industry".. :|

  5. Sounds fantastic! (...fantastic) by bigtallmofo · · Score: 5, Funny

    I was one of the early (...early) adopters of voice over IP (...pee) and I think {static} is great (...great).

    My hat's off to Vonage (...ojj)

    --
    I'm a big tall mofo.
  6. OptimumOnline by The+Ape+With+No+Name · · Score: 2, Funny

    We have OOL here in Brooklyn. The service is great and we haven't had a probl

    --
    Comparing it to Windows will be a moot point, since El Dorado is going to have a 40% larger code base than XP.
  7. I just can't let go ... by krygny · · Score: 3, Interesting

    ... of the ol' hard wired POTS phone in my kitchen. I hardly ever use it, but it was the only one I had during the blackout here in the northeast a couple years ago. The cell system had power, but getting a line was iffy.

    --
    Research shows that 67% of those who use the term "research shows", are just making shit up.
  8. These aren't bragging numbers by TuxPaper · · Score: 3, Interesting
    I see a few posts bragging about these numbers. Stop now before you embarass yourself.

    For example, the biggest VOIP company in Japan, Softbank has about 4.4 million VoIP customers. Yes, that's just one of the VOIP companies in Japan. (Source: cabledatacomnews.com)

    I'm not here to brag about Japan. I'm sure S. Korea and China have impressive, if not larger numbers of VOIP users.

  9. POTS by ClaraBow · · Score: 2, Insightful

    is still the most reliable for me. When the power goes out (often), I still have my phone working and can even use dial-up to send a quick email. The technology is very simple and super reliable, so it won't go away anytime soon.

  10. Something doesn't add up. by tdemark · · Score: 4, Insightful

    $220 million / 2.7 million users = $81.48 / year
    $81.48 per year / 12 month = $6.79 / month

    The average VOIP account only is only $6.79 per month? That doesn't seem right. I have one of the cheaper accounts available ($14.99, VoicePulse), so I am a little skeptical of that number.

    From the linked article, Vonage has 750,000 customers. Assuming they are all on the cheapest plan:

    750,000 x $14.99 x 12 = 134,910,000

    Which would mean for all non-Vonage VOIP customers:

    $85 million / 2 million customers / 12 months = $3.54 per month per customer

    Given the other players involved (VoicePulse, Voicewing, AT&T, Time Warner), I have a hard time believing that number.

    - Tony

    1. Re:Something doesn't add up. by mattmacf · · Score: 2, Interesting
      From TFA: TeleGeography found 2.7 mln US VOIP subscribers nationwide in Q2 2005, compared with just 440,000 in Q2 2004. The revenue generated from consumer VoIP services remained relatively small, at $220 mln

      The $220 million figure may be derived from just Q2 sales figures. Using this, the number doesn't seem as suspect.

      $220 million / 2.7 million users = $81.48 / quarter
      $81.48 per year / 3 months = $27.16 / month

      Given prices for VoIP being between around $20-40/month, an average of $27.16 sounds about right.

      --
      I only mod funny =D
    2. Re:Something doesn't add up. by bobcat7677 · · Score: 2, Interesting

      Keep in mind that pretty much the only services that charge monthly fees are the ones that have PTSN access and a PTSN # packaged in the service. I have 3 different VOIP providers configured in my Asterisk switch for different things. Only one of them (Voicepulse Connect) charges me a monthly fee...and that's just because my incoming number is on that account. The others just charge based on my usage of the PTSN (at
      In the end though I'm just playing Devils advocate to a degree. I agree the numbers appear to be skewed. With all the VOIP providers out there, there has got to be more then 2.7 million customers. Like some of my accounts, many of them may not be generating significant revenue, but then VOIP was never meant to be a cash cow service.

  11. VoIP "pitfalls" by SuperDuG · · Score: 3, Interesting
    I was a Vonage customer for almost a year and a half. I enjoyed the service, but did realize that I was paying for 500 minutes whether I used them or not (just like a cell phone).

    Next problem is I moved, and I found a better deal through my phone company. You may want to check and see what deals your current phone provider has before you jump on the VoIP wagon.

    VoIP is an excellent solution for people who are on the phone long distance for more than just your usual call to your relatives to check up.

    I looked at my useage and already had a cell phone. I must say, in the grand scheme of things that VoIP was not a solution for me any longer.

    Canceling Vonage takes close to an act of congress. You have to call their cancellation center (forget that it's only open 7.5 hours a day monday - friday) then you have to sit on hold (forget the fact that it's like any other call center that you wait a fair amount of time on hold) and then you are given a Return number. Also you are given a $40 charge to your credit card. You have to scrounge up the power supply, ata box, phone cord, ethernet cord, and manual. If you're like me and you know that you'd eventually have to return this stuff, you kept all that in a box in the closet. If you don't return everything, you don't get the refund.

    I was very impressed with Vonage until the very end in which they would not let me cancel my service until I heard a song and dance and agreed that I didn't want their service any more.

    If you have a cell phone with long distance and rarely ever need to make a lengthy long distance phone call, VoIP ain't it.

    --
    Ignore the "p2p is theft" trolls, they're just uninformed
  12. In France by boa13 · · Score: 2, Informative

    In France, there's almost 2 millions VoIP subscribers, which means VoIP is three and a half more popular here.

    This is mostly due to Free, a kick-ass ISP which bundles maximum-speed DSL access (4.6 Mbps in my case, 10,000 feet from the DSLAM), free VoIP communications (to all landlines in France, and cheap rates for everyhting else, except cellular phones), 100 free TV stations (plus 100 others for various fees), an unlimited number of 1 GB web spaces with unlimited bandwidth, no ads, and MySQL+PHP5 support, an unlimited number of mailboxes, and plenty of things I forget right now, all that for the great price of 30 euros per month.

    Their customer service sucks, though, and you better not have problems, because they'll take a long while to be solved.

    Overall, I'm happy. :-)

    I wonder how the VoIP and DSL services are in countries other than France and the U.S.

  13. Yeh... but which phone service by outsourced · · Score: 2, Funny

    makes my squeaky geeky voice sounds manly when I ask Betty Lou out on a date?

  14. Re:Yeah, but which service is the best? by halr9000 · · Score: 2, Informative

    Well the main one that it's not SIP, so you can't take advantage of all of the SIP software and hardware. So I want it to ring an actual telephone.

    Also:
    - distinctive ring
    - call forwarding
    - voicemail

    Check out some of this stuff: http://www.voicepulse.com/features/advanced/defaul t.aspx

    I don't need all of that but its certainly a laundry list of cool VOIP stuff.

  15. Opposite experience by mgkimsal2 · · Score: 2, Interesting

    Due to odd circumstances, I've had 3 vonage accounts in the last year, 2 of which I've had to cancel. It's never taken me more than 15 minutes to cancel, and there's no song and dance or credit card charges.

    The differences may be that I'd bought my own equipment from bestbuy and sam's club already, so there was no issue of returning anything. They just shut off my number - nothing more to it. They did ask why I was cancelling, I told them, and that was it.

    I do agree that in some cases, it's not worth it for some people - paying for the 500 minutes whether you use it or not. But, let me put some of my numbers to you.

    I have a cable modem - roughly $40/month. I'm using that no matter what for internet access. Adding an extra $15/month in vonage on top of that means phone/internet is $55/month. Yes, I'm paying for '500 minutes even if I don't use them' (a vonage 'rollover minutes' plan like cingular would be great).

    However, compare that to my local verizon POTS. It's close to $50/month *before any other charges*. Start adding on all the per minute fees for calls, then extra taxes on top of that, and it's crazy.

    Our phone usage pattern is probably different from most - we've got family both in UK and Australia. Verizon's *best* deal was 10 cents/minute to Australia - Vonage is 4 cents, which includes taxes (verizon adds on taxes later). And to get that wonderful 10 cents per minute rate I have to sign up for 'international caller' plan at an extra $4.99/month.

    Yes, the quality of the Vonage line isn't as solid as the POTS. Occasionally there is static or a really bad connection. I'd say that's less than 1 in 10 calls. But for a 60+% savings, it's definitely worth it in our case.

  16. Why this is not sustainable... by cardpuncher · · Score: 4, Interesting

    "Operator, I'm trying to call my elderly mother, but there seems to be a fault..."

    "Sir, you'll have to have your mother run traceroute and then call us back."

    "How do I call my mother to tell her and how does she run traceroute?"

    "Perhaps you can download the instructions from our website and mail them to her?"

    1. Re:Why this is not sustainable... by SeaFox · · Score: 2, Interesting

      I really don't know. However, if I have VoIP service from Company A running over broadband from Company B using wires provided by Company C and wish to communicate with another party with services from D, E and F, then how do I identify which of (A, B, C, D, E, F) might be required to resolve the problem - and if the problem is with one or more of (D, E, F), with whom I have no contractual relationship, what incentive is there for them to fix it?

      This is the joke of VoIP service, and something they don't tell you when you sign up. Technically NONE OF THEM ARE!

      Vonage can only solve problems on their servers, if the issue is with your broadband provider, you can call them and talk to them about the issue. But keep in mind your cableco probably offers phone service of it's own in competition to VoIP, they measure quality of service from the standpoint of "your internet connection is used for web surfing", which doesn't require as robust a connection as VoIP or XBox Live when it comes to latancy.

      They might have an issue with latancy they will try to improve, but they wont guarantee you Vonage will sound crystal clear. If you're having trouble and they think your connection is "fine", you're SOL. They will probably try to sell you on their own phone service.

      What you have to remember is when you get digital phone service from a cableco (not VoIP tied to your cable modem, but where an RSU is mounted on the outside of your house) they have legal responsibilities that don't apply to cable modem or cable TV service to make sure the service (and 911) are working to decent standard (like SBC would have to). Since this standard doesn't exist for your broadband internet, and they aren't recieving any revenue from your Vonage usage, they aren't that bothered by your sercice being up to snuff for it. The fact there are few choices in broadband internet service for most people helps this.

  17. VOIP Buster -- why pay for outgoing voip? by OsirisX11 · · Score: 2, Interesting

    It is free after the first euro. then its unlimited free international calling, i love it. :)
    http://www.voipbuster.com/