Telcoms equipment CEO warns of challenge from VoIP - Embedded.com

Telcoms equipment CEO warns of challenge from VoIP

LONDON — The UK CEO of DeTeWe, a major telecoms equipment manufacturer and Deutsche Telekom’s main equipment supplier, has warned the industry that up to 40% of the free cashflow currently generated by the telecoms operators could disappear by 2007, as a direct result of the move to Voice over Internet Protocol (VoIP).

At present the telecoms companies worldwide generate something like $450billion of combined free cashflow annually. They can expect to lose 30 – 40% of this revenue stream by 2007 into the ‘black hole’ of voice over internet, according to Nadahl Shocair, CEO of DeTeWe UK and directing strategist for DeTeWe AG.

Shocair said, “Disruptive technologies – namely Voice over Internet Protocol – from providers like Vonage and Skype promise to batter the incumbents’ revenues at an alarming speed as IP telephony takes off. As the voice and service quality of VoIP improves, the enterprise market – seen by many as the saviour for the incumbents in terms of keeping revenues alive – will also switch to IP – probably in the form of managed IP services. These are interesting times – unless of course you’re an operator relying on traditional circuit-switched voice revenues.”

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