Press Release:

New Survey Shows Voice Over Internet Protocol (VoIP) Taking Root in Business

Press Release
News Article  March 2005


Consumer attitudes and technology drawbacks seen as barriers to adoption, though high satisfaction and projected cost savings by business users may potentially seed interest

ROCHESTER, N.Y., March 14 /PRNewswire/ -- According to a new nationwide survey of U.S. adults, awareness and familiarity of Voice over Internet Protocol (VoIP) are significantly higher among businesses than among consumers.

   * While nearly nine in 10 (87%) business decision makers are aware of
     VoIP (76% at least somewhat familiar), one-third (36%) of consumers are
     aware of VoIP (56% at least somewhat familiar).
   * Furthermore, while 12 percent of business decision makers familiar with
     VoIP currently use it, only three percent of consumers familiar with
     the technology use it.

These are some of the results from The 2005 Telecommunications Report, a study conducted quarterly by Harris Interactive(R). The most recent study was conducted in January 2005 among a sample of 1,473 U.S. adults and 335 business decision makers.

Barriers for adoption

The survey suggests that there are several barriers to consumer adoption of VoIP. Some of the barriers relate to attitudes toward the new service. Among those who are aware of VoIP, but do not use it:

   * I just don't know much about VoIP (47%);
   * VoIP providers have failed to show me a convincing story (36%);
   * I'm waiting for VoIP to become more mainstream (34%);
   * Recommendations would help me move toward VoIP (27%);
   * Potential savings are just not worth the hassle (25%);
   * VoIP seems too complicated (equipment, installation) (22%); and
   * VoIP is an unproven technology (22%).

Other barriers stem from the perceived drawbacks of the technology. Among those who are aware of VoIP, but do not use it:

   * VoIP might not support 911 calling in my area (62%);
   * VoIP could be subject to security and privacy issues (60%);
   * In a power failure situation, VoIP would not work (58%); and
   * The quality of my calls could be worse than with traditional phone
     service (52%).

  Good news for service providers

While these barriers obviously pose challenges for VoIP service providers, there is some good news about this new technology. Of those consumers surveyed who currently use VoIP, many say they are either very (13%) or extremely (27%) satisfied with their service while an additional 44 percent say they are somewhat satisfied. The same can be said for businesses that use VoIP. Of those business decision makers surveyed who use the technology, one-third (34%) say they are very satisfied and seven percent say they are extremely satisfied with their VoIP service. An additional 54 percent report being somewhat satisfied with their service.

Also, of those business decision makers surveyed who are likely to use VoIP technology within the next year, nearly three-fourths (72%) are projecting a savings of between 11 and 40 percent in their annual telecom budgets. (See Table 8)

"Addressing the perceived barriers to VoIP technology presents a challenge for service providers, but the potential savings by businesses may be the leverage providers need to not only attract the attention of more businesses, but to seed interest in consumers as well," says Joe Porus, chief architect for Technology Research at Harris Interactive. "And when consumers take into account the overall satisfaction levels of both businesses and consumers who already use the technology, adoption rates may begin to grow."







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