March 9, 2007

VoIP Marketers: Price And Features Slowly Win Over Consumers

To Win Users, Marketers Must Bring Pure-Play VoIP Closer To The Phone

This is the first document in the "Improving Communications Services Marketing" series.

by Sally M. Cohen

with Maribel D. Lopez, Alyssa L. Baer

Executive Summary (This is a document excerpt)

Despite an increasingly competitive provider landscape, only 5% of online households say that they use voice over IP (VoIP) — or its close derivative, voice over instant messaging (VoIM) — at home, and even fewer say that they plan to switch from their current home landline service to VoIP. While unlimited long-distance and prepackaged premium features might resonate with some consumers, quality concerns and service-switching inertia leave pure-play VoIP providers like Vonage and SunRocket struggling to connect with consumers. Going forward, VoIP technology stands to change the market by liberating voice from the phone; but, to win users today, pure-play VoIP marketers should position their services closer to the traditional phone, while calling out expanded features.

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