$1 Billion Market Ahead for VoDSL

Voice over DSL (VoDSL), the ability to provide integrated voice and data services over a single copper pipe, will become a $1 billion market by the end of the year 2000, according to a report by Cahners In-Stat Group.

According to the report “VoDSL: The Killer App,” VoDSL will elevate the role of DSL from a data access alternative to a platform for offering value-added services.

“VoDSL fundamentally changes the business model for CLECs (competitive local exchange carriers) by providing them with an economic means for offering voice services in addition to data services,” said Peter Meade, senior analyst for Cahners In-Stat’s Advanced Carrier Strategy Service. “CLECs are not the only winners, ILECs (incumbent local exchange carrier) will also be better positioned to offer affordable services to the growing small business market and will be able to utilize their existing copper more efficiently.”

According to the Cahner’s report, the best opportunity for VoDSL deployment rests with US small businesses with 20-49 employees. Self-employed, home office workers, and residential customers are not likely to adopt DSL in the next two years.

VoDSL will undergo trials and evaluations in 1999 and early in 2000, followed by real deployments in the second half of the year 2000. Partnerships between pure-play VoDSL vendors CopperCom, Jetstream, and TollBridge and DSL hardware vendors, are critical for early interoperability and mind share, according to Cahners.

“The opportunity presented by VoDSL is expected to increase DSL penetration among small businesses and speed CLEC and ILEC deployments,” said Shannon Pleasant senior analyst for Cahners In-Stat Group’s Voice and Data Communications Group. “As the many announced partnerships demonstrate, the ability to integrate VoDSL quickly within existing platforms to offer an end-to-end DSL solution will be critical for quick deployment and early adoption.”