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VoIP Insurrection

September 30th, 2004 · No Comments

Om Malik has a guest column by Daniel Berninger, senior analyst for Tier1 Research:

As of 2004, every project at the post-divestiture AT&T Labs and Lucent Technologies Bell Labs reflects the reality of voice over Internet Protocol. Every major incumbent carrier, and the largest cable television providers, in the United States has announced a VoIP program. And even as some upstart carriers have used VoIP to lower telephony prices dramatically, even more radical innovators threaten to lower the cost of a phone call to zeroto make it free.

The VoIP insurrection over the last decade marks a milestone in communication history no less dramatic than the arrival of the telephone in 1876. We know data networks and packetized voice will displace the long standing pre-1995 world rooted in Alexander Graham Bell’s invention. It remains uncertain whether telecom’s incumbent carriers and equipment makers will continue to dominate or even survive as the information technology industry absorbs voice as a simple application of the Internet.

VoIP turns telecom into a simple extension of consumer electronics business, because Internet applications exist without metering for time and location. Users of VoIP need not worry about the destination or duration of their calls any more than someone sending an email or browsing the web. People do not pay each time they play a CD, and communications seems headed in the same direction. Microsoft X-Box Player already offers VoIP for participants in multi-player games. Metering and billing calls can easily cost more than delivering the service itself, and the flat rate access billing model eliminates the need for solving inter-carrier compensation.

The decoupling that produces rapid improvements in connectivity and processing platforms also facilitates software development. People working on VoIP applications don’t need to change the nature of the Internet with each new application, and everyone with a computer becomes a potential member of the Internet development team. Applications of the Internet from email to the web to instant messaging and VoIP without exception have come from the tinkering of entrepreneurs rather than an industrial research center backed by market research.

Tags: Telecom

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