Fixed mobile substitution to continue apace through economic downturn

UK-based market watcher Analysys Mason says that fixed mobile substitution will continue to grow throughout the economic downturn, and predicts that enterprise spending on fixed voice services will shrink by 15% next year. The economic turmoil will only contribute around 1-2% of the decline of enterprise fixed voice, with the remainder being a direct consequence of fixed mobile substitution.

The report author, Margaret Hopkins, says that the economic downturn will focus enterprises on maximising cashflow and they will look to audit voice networks to find any wastage. This will result in reduced revenues for fixed line voice operators through the disconnection of unused lines and number ranges. Also with capital expenditure being generally cut back, hosted voice services are likely to strengthen in popularity.

Hopkins believes that reduced capex spend will also persuade more enterprises to adopt mobile-only solutions. Because the cost of buying VoIP phones is upwards of €480 per desk, with €300 running costs and €180 depreciation, some enterprises might believe it cheaper to provide users with mobile phones, now that the price of mobile calls has come down significantly. Further, mobile operators are making substitution an even more attractive prospect with services that offer reduced or free calls within the enterprise and basic PBX functionality.

However, mobile-only solutions don't work quite as well for multinational companies as international calling in particular is quite costly. A better solution in these cases is to route calls over the enterprise converged data network as much as possible. These requirements are driving the popularity of fixed-mobile convergence (FMC) solutions. Analysys Mason agrees, and forecasts that spending on FMC services will grow with a CAGR of 41% through to 2015, albeit from a fairly low base.

Anthony Plewes

After a Masters in Computer Science, I decided that I preferred writing about IT rather than programming. My 20-year writing career has taken me to Hong Kong and London where I've edited and written for IT, business and electronics publications. In 2002 I co-founded Futurity Media with Stewart Baines where I continue to write about a range of topics such as unified communications, cloud computing and enterprise applications.