Vonage Leads US Market Share

Although VoIP isn’t very popular in the US yet, service providers say adoption is growing (up 20% since last June), and that most users are very satisfied with service.


“About 3.9 million US households used VoIP as their home-phone service in January 2006,” according to a study released Tuesday by Telephia, a market research firm. “That accounts for about 3.5% of U.S. households, up from 2.9% using VoIP in June 2005.” However, the survey failed to include digital phone offerings from cable companies such as Comcast, and Time Warner, which offer “triple-play” packages of television, high-speed data and phone service.
Vonage is the distinct top-dog when it comes to non-cable VoIP services. Vonage lead with a 40% market share last June, and has currently rose to 47.5%. Vonage has nearly four times the US share of its closest competitor Skype, which holds an 11.8% share.

However, market share doesn’t necessarily lead to profitability. Vonage, which announced IPO plans last month, lost almost $190 million in the first nine months of 2005.

Other VoIP providers listed in the market share report include CallVantage from AT&T, VoiceWing from Verizon, and Google. Market share for these providers was 5.6%, 5.0% and 2.5%, respectively.

VoIP’s most early adopters have had the fortune of being content with service quality, unlike the ire of broadband providers, many of which sell their own telephone products. About 86% of respondents said voice quality was equal to or better than traditional phone service. A similar percentage said they considered VoIP to be equally or more reliable as well.

Summary

Although VoIP isn’t very popular in the US yet, service providers say adoption is growing (up 20% since last June), and that most users are very satisfied with service.


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