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Communications Technology

2.7 Million VOIP Subscribers in the United States 116

Posted by samzenpus from the new-phones dept.
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."
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2.7 Million VOIP Subscribers in the United States More

2.7 Million VOIP Subscribers in the United States

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  • What is even more interresting... (Score:5, Interesting)

    by nordicfrost ( 118437 ) on Saturday August 20, 2005 @07:14AM (#13361225)
    ...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.

    • Yeah... but the problem is.. (Score:3, Insightful)

      by Anonymous Coward
      ..that you "don't matter", since you're "leeching" and not "generating millions for the industry".. :|
    • 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. :(
    • While I see your point, I find that what is even more interesting is the fact that this is one statistic we in the USA can be proud of. I believe we are in the lead here. I know that very soon, several countries will catch up and pass us just like all the other statistics have shown. Until that happens, I can claim bragging rights. Let's watch China, South Korea, Sweden, Japan, Finland, the United Kingdom and Germany.
      • I think the main reason that VOIP isn't so popular in the UK is that most long distance phone companies charge much the same rates as the likes of Vonage, so there isn't really any point in having the hassle of using your computer to make calls, or buying the kit to use a normal phone over the internet.
        • Using Vonage does not require using your computer. It plugs into your broadband connection and allows you to use your normal phone. In addition, Vonage charge something like $40 to get set up, and then the first month is free. So I don't think setup fee or hassle is the reason...

          It could be the rates though - I moved away from England several years ago and so I don't remember how much they charge.

          • In the UK, Vonage costs £9.99 per month for unlimited calls to UK and Ireland. You have to pay £29.99 in Staples for the router that allows you to plug your normal phone into your internet connection.

            Onetel charges £10.99 per month for unlimited calls, or you could get it from Tele2 for £7.49 or Tiscali for £7.99. They use carrier preselect, which means you just sign up and use your existing phone as normal.

            Vonage does have the advantage that it includes calls to Ireland, but

    • Re:What is even more interresting... (Score:5, Interesting)

      by caseydk ( 203763 ) on Saturday August 20, 2005 @07:57AM (#13361319) Homepage Journal

      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.
      • Yeah but that's what technology is supposed to do - make doing the same things cheaper or easier. Remember 10 years ago when every cell phone provider had a plan for $15 / month? Now you can't touch most any cell phone plan for less than $30 or $40 / month. That's ridiculous.

        2 years ago before I switched to Vonage I was paying Verizon over $45 / month for a basic phone line with some features (caller id, call waiting, etc.). My wife and I use almost zero long distance and don't even talk on the phone

        • Unfortunately, if they're working entirely by using others' infrastructures there will eventually come a point where they have to pay to maintain some portion of the infrastructure...

          This isn't much of a near-term problem, but if Verizon, et al's revenue starts suffering as a result, they're liable to fight back any way they can.
      • As a customer of a traditional phone company, I am proud to say that I am "generating" more than my share of revenue.

        What, generating revenue isn't the goal? Huh.

        Gross revenue is only one way to measure an industry, and as several people have pointed out here, it doesn't seem to be a good way to measure VOIP, because it is commonly free. Of course, determining the number of phone call-minutes is going to be difficult for this technology....

    • Another possible Skype alternitave is Gizmo [gizmoproject.com] they charge more than Skype for calling PSTN but the client UI is pretty full-featured.
    • if you give it the access it needs to become a supernode it can really rape your connection maxing out 100mbit is not unheared of!

    • ...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.

  • 911? (Score:5, Insightful)

    by Anonymous Coward on Saturday August 20, 2005 @07:15AM (#13361229)
    Is this still a shortcoming of VOIP? If so, that's a lot of people without a lifeline.

      • Re:911? (Score:2, Informative)

        by bn0p ( 656911 )
        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 91
        • Since we have 2 cell phones in the house, we dumped out POST.

          Since they are passing regulations on 911 over voip, the liability will fall on the regulation creators as opposed to the companies themselves. So long as the companies satisfy the regulation.
        • I have never called 911 from my POTS line, and I don't plan on doing so in the future! Avoid unforseen emergencies - that's my advice. ;)

    • Re:911? (Score:3, Interesting)

      by Albanach ( 527650 )
      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 operator

      • Re:911? (Score:3, Informative)

        by rekoil ( 168689 )
        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 ca
    • Or a lot of people with cellphones as their "emergency contact"

    • Re:911? (Score:4, Informative)

      by dattaway ( 3088 ) on Saturday August 20, 2005 @09:22AM (#13361538) Homepage Journal
      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.
      • We approved concealed carry, because 911 is NOT working.

        You mean you approved your pet conservative cause that is not proven to reduce crime because you won't pay for the services that are?

        • You mean you approved your pet conservative cause that is not proven to reduce crime because you won't pay for the services that are?

          It reduces crime for approximately two million individuals [guncite.com] per year. Police have no obligation to defend individuals [foxnews.com], so even if "crime" were reduced by dumping more money into police, that may or may not have a bearing on violent crime. Moreover, a well paid police force is little comfort to the family of a law abiding citizen complying with state and local laws abridging t

          • Re:911? (Score:2, Troll)

            by greg_barton ( 5551 )
            It reduces crime for approximately two million individuals per year.

            I'm sorry bubba, but the level of proof between the "concealed carry laws reduce crime" assertion and the "effective law enforcement reduces crime" assertion are not comparable. End of story.

            Look, I live in Texas. I could carry a gun if I wanted to. I love to shoot shit. It's fun. I've also never been a victim of a violent crime, and I've lived in Dallas all of my life, lots of it in the roughest areas. (Dallas has the highest murder r

            • Re:911? (Score:1, Flamebait)

              by ErikZ ( 55491 )

              Yeah man. I've been smoking all my life and have never gotten cancer. All those studies are BS.
        • What nonsense is this? It's quite well-known that the crime rate decreases with gun legality and increases when guns become illegal. 911, however, does nothing to reduce crime-- nor is it meant to.
          • 911, however, does nothing to reduce crime-- nor is it meant to.

            Right. Being able to summon police to the scene of a crime does not stop crime. Being able to inform police of a crime in progress would never help to stop that crime. Sure.

            Are you a fucking idiot?
            • Are you? Once the crime is started, the criminal is already liable-- you think they won't still make an attempt to get something out of it? After all, the police won't be there for at least a few minutes.

        • It isn't prooven to increase crime either. Therefore why not let the honest folks carry a gun in case it helps?

    • Here where I live in Illinois, Vonage connects me to my local 911 call center, but the call comes in on an outside line. When I tested a 911 call, the operator was surprised to get a call that way, but as long as the call went through I was satisfied.

      As a back up, we have two cell phones.

    • I thought that this was the issue the FCC was confronting in this story. [slashdot.org]
    • A gun in the hand is better than a cop on the phone.

      and

      "911" - government sponsored Dial-a-Prayer
  • I talk to the big telcos on a regular basis as part of my job and I've been jabbing them for a while about the impending death of their voice business, but their stories have been changing, well not Bell South, but the others are really pushing hard into home and business VOIP, especially ATT.

    POTS doesn't need a death watch yet, but it's certainly moving that way.

    Jerry
    http://www.cyvin.org/ [cyvin.org]
  • 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 ma

  • Sounds fantastic! (...fantastic) (Score:5, Funny)

    by bigtallmofo ( 695287 ) on Saturday August 20, 2005 @07:20AM (#13361237)
    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)
    • My only complaint about Vonage is that their rented exchanges don't always have the same capabilities.

      I just signed up, and while they advertise the ability to transfer (port) landline and cellphone numbers to their service, they happened to put me on an exchange (owned by McLeod) that can only accept landline number transfers. It's a bit annoying because I just made a $50 cellphone payment that could have been avoided if they had all of their stuff in order. My number even passed the number "test" on t

    • I hear (...eeaar) you loud ( .ooud) and quite staticky (...icky...icky) I'm in the same boat waiting for an LNP back to my baby bell
    • I've had vonage for a while, and most of the time it sounds way better than my landline (which I still have with minimum service, since cells don't work near my house).

      The only time it's been choppy is when I used 4 way calling (I call family member who has 3-way, and then we each add another person) and two people try to talk at once. It's not as bad on 3-way, but I think that's because there are fewer times when both other people are trying to talk at once.
    • Heh.

      But if you are seriously concerned about your line, try http://testyourvoip.com/ [testyourvoip.com]. It is a free service and allows you to keep a history of performance so you can try a few times and see if the service degrades at any particular time.

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

  • I just can't let go ... (Score:4, Interesting)

    by krygny ( 473134 ) on Saturday August 20, 2005 @07:39AM (#13361280)
    ... 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.

  • These aren't bragging numbers (Score:3, Interesting)

    by TuxPaper ( 531914 ) on Saturday August 20, 2005 @07:55AM (#13361317)
    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 [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.

  • POTS (Score:2, Insightful)

    by ClaraBow ( 212734 )
    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.
    • When the power goes out, the cable usually still works. Just get a UPS for your router, cable modem, and VoIP device (if you want VoIP service) and you shouldn't have a problem. (I'm assuming your computer is a laptop, since power outage and no UPS leaves you with a computer?)
      • Or just get a cell phone. it doesn't even need to have service, as most (all?) cell phones will let you dial 911 no matter what.
        • Actually, it would be nice if Linksys made a PAP2 with some kind of cell support-- then, when you dial '911' have it route via the cell instead of the net. Add a emergency power-savings mode that only bridges the cell network, and you've solved the 911 problem completely (unless I'm missing something)

  • Something doesn't add up. (Score:4, Insightful)

    by tdemark ( 512406 ) on Saturday August 20, 2005 @07:59AM (#13361325) Homepage
    $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 [voicepulse.com]), 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
    • 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 [voicepulse.com]), so I am a little skeptical of that number.

      Vonage has hired several Bistromathematicians [wikipedia.org] experts to sort out the numbers. It's part of the corporate strategy to give the illusion of being on top.
    • 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 a

    • 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 app
      • Exactly, Asterisk comes to the rescue. I'm using sipphone and voipjet (which charge no monthly fee) but you pay for the calls as you go (which if you use voipjet is really cheap!) 1.3c per minute US / UK. SO not all VOIP users are paying a Vonage monthly fee. On the other hand I did purchase a sipphone virtual number for $70 a year - so there is where some of my contribution comes in to this figure, but this fee is a 'must have' for me since I'd like people outside of VOIP to have the chance to call me. I
    • I'm guessing they include stuff like SipPhone that only charges $70 for a year's access to a regular phone # and $10/$20/$50 for minutes that last for about 2 years. So if you work it right, that hovers below the $6.79 number.

  • VoIP "pitfalls" (Score:4, Interesting)

    by SuperDuG ( 134989 ) <[be] [at] [eclec.tk]> on Saturday August 20, 2005 @08:16AM (#13361359) Homepage Journal
    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.

    • Opposite experience (Score:3, Interesting)

      by mgkimsal2 ( 200677 )
      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
    • I think that the $40 is a bit silly, considering that they advertise it as a "free phone adapter" (it's not free if you have to pay for it). It would appear that it is detailed in their terms of service though.

      I doubt that they really even reuse these things. It would be more likely that they use it as another way to milk $40 from a customer before they drop the service. Kinda shady, but I guess we have to read the fine print.

      http://vonage.com/features_terms_service.php?lid=f ooter_terms [vonage.com]

      Seems to be

    • I haven't had to cancel yet, so don't know that end of it. But I almost never make long distance calls, and I would say VoIP is still quite desirable. Granted, my usage is also out of the norm.

      I switched from SBC POTS to Cox Cable's phone system because it was cheaper. Not a whole lot, but a bit. Then I switched to VoIP because it is HALF Cox's price and gives me a ton more features. Being able to check my messages online from anywhere is icing on the cake. I only have Vonage's 500 minute plan, but th
    • See here: Fuck Vonage [damienkatz.net]

      Lots of great comments there too.
    • Having run my own OSS PBX, Asterisk [asterisk.org] for over a year now I was able to use its Call Detail Records (CDR) database to figure out that my best bet was to use Broadvoice [broadvoice.com] and its unlimited in-state plan at $9.99/mo and Voicepulse [voicepulse.com] with its DirectConnect! service to pay 2.4 cents/min for all other calls. I estimate my phone bills will be around $15/mo instead of paying SBC $38 just for local service!

      Not to mention that I can now take and make multiple calls simultaneously.

      It's all in knowing your usage when desi

  • In France (Score:3, Informative)

    by boa13 ( 548222 ) on Saturday August 20, 2005 @08:19AM (#13361367) Homepage Journal
    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.
  • Has anyone seen a good rundown on the pros and cons of a lot of VOIP services? I'm looking to get a second line at the house for work, but don't want to pay for it. I don't mind paying $5-7 for an incoming virtual phone#, I just don't want to pay $35-45 for a regulated line.

    Skype is cool but not sure if it has the features I would need. I like Voicepulse's features but they are still in the $20+ range. I'm gonna be low usage on the call-out (to PSTN), so I want to stick with something where I pay as I g
  • makes my squeaky geeky voice sounds manly when I ask Betty Lou out on a date?

  • Why this is not sustainable... (Score:5, Interesting)

    by cardpuncher ( 713057 ) on Saturday August 20, 2005 @09:00AM (#13361472)
    "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?"
    • Doesn't BrightHouse or Time Warner Digital Phone service offer on-site techs for VoIP line issues?
      • 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?

        These are issues that have been addressed by fixed-line teleph
        • 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 tel
  • "Time Warner [is the] second-largest, trailing only Vonage [which has about] 750,000 [3x 2004Q2]"

    Who's got the actual market share numbers, either from TeleGeography, or otherwise?
  • ...Voice-over-IP subscribes to *YOU*! Seriously, I think VoIP is just another step towards convergence -- where all anyone will need for communications is a TCP/IP feed in your choice of broadband flavors, for everything from telephone service to surfing to music and TV entertainment. All on-demand and customizable. (The only hitch is making sure some semblance of privacy remains.)
  • If their commercials weren't so fucking annoying.
  • I've been Beta testing Bell.ca's Internet Voice [www.bce.ca] for about a year now,
    It works great, there were a few slight hiccups at rst (mostly dealing with my non standard [not a store-bought router firewall situation) but that's all long since been resolved. I've taken it all over the place and it works great on any high speed connection. As more people discover computers and what they can do with them, more people will adopt this type of tech, anyone who can grasp the concept of configuring their home networking ro
  • It is free after the first euro. then its unlimited free international calling, i love it. :)
    http://www.voipbuster.com/ [voipbuster.com]

  • 2.7 Million minus one. As of this afternoon I am cancelling my Vonage account. Why? I waited a year for them to pick up my local area code and exchange, which they said was coming when I signed up. It didn't come fast enough. Sorry, Vonage.

    IF I decided to put VoIP back in service in my home (as opposed to just using our cells), it will be with Packet8. Packet8 not only has my area code and exchange, they also have E911 service for my area (and most other areas) AND they're cheaper.

    • I have had packet8 for over a year now. The VOIP service has been good.

      The customer support is incompetent, it took 3 calls until I found someone willing to fix the extra charge on my account. Email support never answers.
  • Vonage [vonage.com] is running a promotion in preparation for welcoming their 1 millionth [eprize.net] line / customer / whatever. It looks like you can play only once a day, but it might be something to put on your list of things to do when you get in or out of work...
  • I had vonage for about 3 months. their service is great (no static, no downtime) but their customer service is horrible.
    I had to move and called them. they would repeatedly hang up on me. finally frustrated, I tried to cancel my service. it is simply impossible to cancel their service. they will just hang up on you. their customer service is terrible.

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