• by Jack Loechner , Staff Writer @mp_research, October 13, 2005

Telephia recently reported that Internet-based telephone service (or Internet telephony) is replacing traditional landline phone service among those who have chosen VoIP, a technology that allows consumers to place telephone calls over the Internet. Fifty-three percent of high-tech households subscribing to Internet telephony have completely replaced and disconnected their landline phones. High-tech households are identified as those who currently subscribe to at least three bundled or emerging services (e.g., wireless data, video-on-demand, Internet-based telephony, satellite radio, broadband, DVR, etc.), or expressed an intent to purchase four or more services.

According to the Telephia Emerging Personal Communications Options (EPCO) survey of high-tech households, when asked what the primary reasons were for subscribing or having interest in Internet-based telephone service:

• 59 percent said savings on calls within the United States was the top factor in making the switch.
• Among those who showed interest in adopting Internet telephony, but have not subscribed to a service, 30 percent said that bundled package deals were a key reason for their interest.
• For these 'intenders,' seventeen percent said interconnectivity across different communication services was important
• Fifteen percent said the ability to switch between telephone networks
• Eleven percent mentioned caller ID on TV as a reason for interest

Forty-three percent of high-tech households who continue to use traditional landline phone services, but are interested in adopting Internet-based telephone service, said that availability during a power outage was a reason for not replacing their landline phone service:

In addition, Jim Penhume of StrategyAnalytics reports that EBay's acquisition of VoIP provider Skype reflects the increasing importance that portals and other consumer-focused web companies are placing on communications functions such as messaging and VOIP. The merger will raise consumer awareness and acceptance of all types of VOIP services.

And, Nielsen//NetRatings reports that Skype saw 6.9 million active users, or a 2.4 percent active reach, during July 2005, across the 10 countries of Australia, Brazil, France, Germany, Italy, Spain, Sweden, Switzerland, U.K. and U.S. In the U.S., Skype reached an all-time high of 1.3 million unique users, or an active reach of less than one percent, during July 2005. Year-over-year growth from August 2004 to August 2005 shows a 178 percent rise in unique users.

For more about this study, go here.