Wireless VoIP set to boom

Mobiles with built-in Wi-Fi will be in part responsible for wireless Internet telephony services being worth nearly €2bn by the end of the decade

Making voice calls over wireless data networks is an area set to take off, analysts predict, though the technology still has some hurdles to overcome.

The rise of dual-mode handsets which switch between mobile phone and Wi-Fi networks is seen as a positive step for the voice over wireless LANs.

In 2004, worldwide revenue from dual-mode handsets hit $6.7m (£3.7m) and from all Wi-Fi VoIP handsets totalled $54.7m, according to Infonetics Research, which predicts strong growth in the market until 2009.

Separate research from analyst house Frost and Sullivan said the new handsets could help mobile providers increase revenue per user and reduce customer churn, because allowing customers to switch between Wi-Fi and mobile phone networks effectively increases coverage.

Debates over which standards and technologies to use for VoWLAN need to be worked out, though.

While many in the mobile and telecoms industry promote unlicensed mobile access, it may not be the best long-term solution as it does not fully support the SIP standard often used for VoIP, push-to-talk and messaging and is not aligned with Internet protocol for multimedia subsystems for creating converged networks, according to Frost and Sullivan.

Another obstacle is quality of service, which has plagued all sorts of digital voice communications and VoWLAN is no different. Hope here is seen in the 802.11e standard, due to be ratified later this year, which would prioritise voice over data communications and allow vendors to make interoperable products, the analyst said.

Despite all this, Frost and Sullivan is betting the positives will outweigh the negatives in the long run. It predicts revenues for the European VoWLAN market will jump from €6.6m (£4.5m) in 2004 to €1.9bn in 2010 — annual growth of nearly 160 percent.