VoIP will be worth €12bn in Europe by 2010

As many as 32 million workers in Europe will be using voice over IP (VoIP) within five years, according to a report from analyst firm Analysys.

In that same time period, spending on VoIP systems and services is set to rise too, by more than 17 per cent each year to reach €12bn in western Europe.

It also predicts that by 2010, 1.6 million corporate employees in western Europe will have discarded their traditional fixed office phone in favour of a mobile phone handset.

Report author Margaret Hopkins said: "VoIP has become the de facto future of voice systems, and, consequently, vendors are ceasing development of the older TDM (time division multiplex) systems."

She said VoIP systems allow softphone users to have their office phone wherever they plug in their laptop, and mobile offerings, including email and smart phones, can now behave as if they are extensions on the company's private telephone network.

But the report warns that enterprises cannot always justify spending on VoIP outside of the contact centres - unless they need a new voice system anyway.

"Existing TDM equipment cannot compete with the new features but it works adequately for most situations. It is only in the contact centre, where performance is closely monitored, that upgrading to VoIP can be justified," added Hopkins.

Analysys predicts that spending on enterprise voice systems and services is expected to fall at the rate of about 1.3 per cent each year, with VoIP and mobile spend growing at the expense of TDM.

"Deployment has started of 'mostly mobile' systems, in which almost all employees use mobile phones for all voice communications," said Hopkins. "In effect, new 'mostly mobile' systems are VoIP systems in which there are no IP handsets thus eliminating one of the big costs of migration to VoIP," she added.