VoIP Makes Big Gains In Consumer Market

Voice over IP (VoIP) is quickly grabbing a toe-hold in the consumer telecommunications market, according to a new study by Telephia. In the second quarter of this year alone, the number of home VoIP service subscribers in the United States rose from 3.1% to 4.1% of total households.

According to Telephia, the wide availability of broadband Internet access has made VoIP an attractive alternative to traditional telephone service. Indeed, the market increased some 700,000 VoIP households, from 2.2 million in the first quarter of 2006 to 2.9 million in the second.

However, VoIP subscribers seem inclined to value quality of service and features over provider brand loyalty. The Telephia study found that 27.4% of customers would change providers for improved service quality, while 17.4% would switch for better customer service. "The VoIP market is highly competitive with many different players trying to get a bigger slice of the market share," Telephia vice president of new products Kanishka Agarwal said in a statement. "Service providers who offer the best customer experience through superior product quality and excellent customer service will beat out their competition."

Vonage is the 800-pound gorilla of consumer VoIP, with a whopping 53.9% market share. Verizon VoiceWing and AT&T CallVantage are tied in a distant second-place with 5.5%. SunRocket is close behind with a 4% market share.