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VARs, CLECs, Big Carriers Mull Telecom Industry Flux

Complex issues related to the growth of VoIP and wireless technology, the commoditization of analog voice service and major carriers' increasingly aggressive tactics weighed on the minds of VARs and competitive local exchange carriers (CLECs) at the Channel Partners Conference and Expo in Las Vegas and the CTIA Wireless 2005 show in New Orleans.

At CTIA, David Tews, vice president of Indigo Wireless, a diversified service provider in Mansfield, Pa., said VoIP now accounts for 60 percent of Indigo's overall business, a fivefold increase in just one year. But such growth may not be sustainable, he said.

"Next year, we may see [VoIP sales] go down because carriers like Sprint and others are reducing rates to compete with VoIP," Tews said.

Though in the short term businesses may be slow to adopt VoIP, consumers are snapping it up, according to Greg Praske, CEO of Association Resource Group, a telecom solution provider in McLean, Va. "We are just getting started with VoIP," he said at the Channel Partners Conference. "It's like when local service opened up in the late '90s. A whole lot of people are marketing [VoIP] services right now, and in the next several months the market will flush out whoever can't perform." Last fall, Association Resource Group completed MCI's largest VoIP sale over a private IP network, he added.

The reason for the difference in commercial vs. consumer adoption of VoIP is network complexity, Praske said. "For consumers, there are fewer obstacles to VoIP. But for businesses, there are more quality-of-services issues because VoIP can have a huge impact on your bandwidth," he said.

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