Juniper Research predicts that the total number of mobile VoIP minutes will jump from 15 billion minutes in 2010 to 470.6 billion minutes by 2015. The United States is going to account for 135 billion mobile VoIP minutes by 2015.
Analysts at Juniper Research also now estimate there will be about one billion users of mobile VoIP apps and services by about 2017.
For mobile service providers, that is not good news, though. Though many forecasters have been predicting significant mobile VoIP revenue, most, if not all forecasts have fallen short in recent years, in large part because most of the activity seems to be “free” or “no incremental charge” use of over the top applications, not paid carrier mobile voice.
"As with Skype on the desktop, only a very small proportion will pay for the service," Juniper Research says. “Wi-Fi mobile VoIP is potentially the most damaging of all VoIP traffic, as it bypasses the mobile networks altogether."
That’s a rather simple illustration of the nature of IP networks, though, where applications are deliberately designed to operate independently of the networks carrying those apps.
That means services such as voice and messaging that once were tightly integrated with the mobile and fixed networks now can be provided by any number of providers that do not require tight integration with the networks.
And that, quite simply, means mobile voice is not necessarily a significant revenue producer for mobile service providers. In fact, mobile VoIP probably cannibalizes mobile voice revenue.
“We forecast that mobile VoIP over Wi-Fi will cost operators $5 billion globally by 2015,” says Anthony Cox, Juniper Research analyst. “Many subscriber sign up to an OTT service without ever planning to pay a cent for it, and some industry players do not have a short-term revenue model at all,” says Cox.
In fact, a recent forecast by Visiongain suggests that 2012 mobile VoIP revenue will reach only about $2.5 billion, globally. That is, in many cases, an order of magnitude less revenue than most analysts had expected would be generated by mobile VoIP, at this point in time.
Researchers at Analysys have in the past predicted that, as early as 2012, mobile VoIP services would generate revenue of $18.6 billion (EUR15.3 billion) in the United States and $7.3 billion (EUR.6.0 billion) in Western Europe, compared with fixed VoIP revenue of $11.9 (EUR9.8 billion) in the United States and $6.9 billion (EUR5.7 billion) in Western Europe.
It is highly doubtful that those levels of revenue have been realized, though. In fact, analysts seem to have overestimated the revenue mobile VoIP would represent, rather consistently.
That is not an unusual problem in the forecasting business, by any means. In fact, it is common for revenue growth of a new market to be significantly overestimated, early on. In the case of mobile VoIP, it now seems the assumptions about revenue growth have relied too much on basic pricing mechanisms remaining stable.
But voice services increasingly are sold almost without cost by over the top providers, and the existence of those alternatives forces service providers to adjust their own pricing accordingly.
In short, mobile VoIP is not turning out to be a huge revenue generator for mobile service providers, and is a modest source for over the top providers.
Edited by Brooke Neuman