Study: Consumers Cite VoIP's Inferior Quality

Consumers report that VoIP is not ready for prime time, but are looking forward to a when it is.

June 18, 2004

2 Min Read
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Potential subscribers to Internet phoning services are still hesitating to sign up for Voice over IP (VoIP) service due to "inferior sound quality and service reliability," but they will jump at the service when it improves, according to a new study.

Mercer Management Consulting surveyed 1,000 consumers in the United States and the United Kingdom and concluded that VoIP services should be designed and marketed to consumers differently than they are today. The market research firm suggested that big established telecommunications firms will do a better job of selling VoIP than will startups.

Tom Russell, a partner at Mercer in the U. K., pointed to a promising French approach to selling VoIP: "France Telecom has opened up its local loop to independent telecommunications service providers," he said in an interview Monday. "And this will result in increased VoIP competition there."

Although VoIP service has improved dramatically in recent years, subscribers can still experience poor fidelity and their service fails when broadband connections fail -- a still common occurrence. Mercer noted that consumers also tend to view mobile phone service providers as somewhat unreliable.

"The typical VoIP service of today," the Mercer report states, "appeals to a niche of highly price-sensitive consumers and technology geeks." But improved VoIP technology marketed by established cable and mobile phone service providers could capture as much as 30 percent of the traditional telecommunications market in as little as three years.Mercer found that consumers don't seem to extraordinarily sensitive to call rates -- the chief selling point of VoIP to date -- but that they tend to be more concerned about the fixed charge they pay for phone service. The market research firm also said that the new policy mandated by the FCC to make it easy for subscribers to keep their existing telephone numbers when they switch phone service should help ease the switch to VoIP.

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