Beware of VoIP Forecasts

I’ve seen a trend recently that has a familiar ring to it. More and more, I see “experts” (such as big-name analyst firms) herding together to make about the same predictions for retail VoIP:

  1. Cable telephone service is growing fast
  2. The incumbent telcos will get serious about VoIP services
  3. As a result, in the future, the market will be dominated by the cablecos and traditional telcos, and the “pure play” VoIP players (Vonage, Sunrocket, etc.) will have only a small fraction of the market

This is all well and good. But it makes one very important assumption: THAT THE WORLD WILL STAY THE SAME. These reports assume the only kinds of VoIP on the table will be Phone-over-IP as defined by Vonage and all the Vonage copycats.

As an example, here we are several years since Skype first came on the scene, and yet amazingly most these (very expensive) research reports still fail to include Skype figures as more than a footnote. Skype is up to what, several hundred million downloads, and tens of millions of people using it? That’s a bit more than a footnote. I think pretending they don’t exist is more wishful thinking than sound analyses (these firms are in the business of telling their clients what they want to hear, after all).

What were the reports from these experts saying in 2001 (before Vonage was here)? Would that report make sense in a post-Vonage world? I’ve used this analogy before, but again, this sounds like the pre-Internet on-line services days. How quaint would we find the hypothetical 1990 research report entitled “On-line Services Subscribers to hit 33 million by 2000”? Or, to take it even further. the 1905 report “Buggy whip demand to outpace supply through 1925”.