Is a VoIP price war the way to go?

According to figures released by Telephia, a leading provider of performance measurement information for the mobile industry, 59% of households that made the switch to VoIP made it primarily for cost reasons.

What does this mean? Well, as mentioned in my last post, the market is becoming more fragmented and, after a certain period, consolidation will occur – as is the case in most technology sectors. I bet my hat that many people are going to get their fingers burnt by not choosing the right VoIP service provider.

Cost is a dangerous battleground to fight on as, at the end of the day, any company seeks bigger profits, not less. So, while cost-cutting might prove attractive to customers, it would be better for companies to offer more add-ons and extra services to circumvent the need for cost cutting.

As you can guess though, the biggest losers will be the traditional telecommunication powerhouses, which are gradually seeing their grip on the sector being loosened by relative newcomers.

To worsen things, what was their prized possession – the last mile to the subscriber’s line, is in danger of losing significant value thanks to the development of wireless.