September 20, 2005
VoIP in Japan
According to Kamal Anand, VP Marketing at Meru Networks, Japan represents the most developed and challenging VoIP market in the world. Jupiter Research states that the adoption of VoIP in the US will grow from 1% in 2004 to 12% in 2009. Even though this adoption rate is fantastic, it is less than half of what is projected for Japan. Japan has less than half the population of the US and according to Yano Research Institute, by 2008 will have around 28 million VoIP users.
The main reason for the difference in growth rates is that the level of public awareness in the US regarding VoIP is not very high. According to Will Stofega, VoIP analyst at IDC, the Japanese are accustomed to communication on the move and see VoIP as a cost-effective method of supporting voice services. A call using VoIP is approximately eight times cheaper than that using circuit-switching technology. As far back as 2003, the Japanese government had introduced 050 numbers that would enable the traditional telephone services to make the switch to VoIP.
Another important factor that favors the growth of VoIP in Japan is the availability of broadband. More than a fourth of the Japanese population has access to high-speed broadband and the speeds can touch 12 Mbps, while in the US, the average broadband speed is 3 Mbps. Unlike in the US, regulatory requirements in Japan are not very stringent. Providers are not expected to comply with regulations such as support for 911 and electronic surveillance. Latency and QoS are not major issues in Japan as there is ample bandwidth available for the IP providers.
To try and achieve better growth, VoIP providers in the US should focus more on services and promote features such as soft phone handsets and virtual phone numbers. The entry of online companies like AOL should also boost the growth of VoIP as they have an established customer base to target and can focus more on providing service.
In Japan, VoIP services are marketed bundled along with video and Internet by the cable providers. VoIP is also available with land line and cell phone packages. In the US, providers need to present a stronger case for VoIP apart from highlighting the cost-benefits of VoIP.
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