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Saving a few bucks with IP telephony
Improvements in technology, the efficiency of Internet-based communications, global deregulation of the communications industry and the convergence of the Internet-based communications and traditional telecommunications markets all have combined to create significant new opportunities for providers of Internet-based services, including the opportunity to address the large and growing telecommunications market.
TeleGeography, a market research firm, estimates the amount of international long distance traffic is expected to grow from approximately 94 billion minutes in 1998 to approximately 143 billion minutes in 2001.
The convergence of the Internet-based communications and traditional telecommunications markets is gaining momentum because technological improvements have recently made it more practical to utilize Internet protocol technology for telephone connections, particularly international calls, and not just to transmit data over the Internet. It is now possible to transmit phone-to-phone calls over Internet-based networks with quality approaching that of traditional, switch-based voice networks.
His master's voice
Transmitting voice over the Internet, or "Internet telephony," presents a significant opportunity because it allows telecommunications providers to bypass incumbent long distance telephone tariff and rate structures and greatly reduces the cost of connecting international calls.
Internet telephony is also more cost-effective and efficient than traditional switched telephony because Internet-based networks allow voice and data calls to be pooled, enabling telecommunications providers to carry more calls over lines with the same amount of bandwidth. So Internet telephony is expected to capture an increasing share of the international long distance telephone market.
According to International Data Corporation, voice minutes transmitted over Internet-based networks are expected to increase from 300 million minutes in 1998 to 135 billion minutes in 2004.
Demand for a wide variety of other Internet-based communications services, such as Internet roaming, is also expected to increase. Internet roaming enables end users to access the Internet by using the network facilities and services of a provider other than their "home provider" or provider with whom they have an Internet access account.
This demand for Internet roaming services is being driven by a number of factors, including the rapid growth of Internet users worldwide, the increase in global consumer and business travel and the prevalence of e-mail as a medium for the exchange of information. According to the Yankee Group, the worldwide market for remote access services, including Internet roaming, will increase from approximately US$430 million in 1998 to approximately US$1.98 billion in 2002.
A new buzz: business to business
The Internet is one of the fastest-growing means of communication, reaching consumers and businesses globally. So it's not surprising to see businesses joining the cyber frenzy. Forrester Research expects business-to-business electronic commerce to grow more rapidly than business-to-consumer electronic commerce over the next several years. Forrester Research estimates that business-to-business electronic commerce will grow from US$109 billion in 1999 to US$1.3 trillion in 2003, accounting for 90% of the dollar value of electronic commerce in the United States by 2003, and that total electronic commerce worldwide may reach as high as US$3.2 trillion by 2003.
Auctions targeted at consumers are a popular application of Internet technology. Forrester Research projects that the value of goods sold through Internet auctions will increase from US$8.7 billion in 1998 to US$52.6 billion in 2002. The popularity of consumer-oriented auction sites and the opportunity presented by business-to-business electronic commerce have spurred the creation of business-to-business Internet auction sites.
Everything from Beanie Babies to Pokémon cards is sold on sites like eBay. Transactions on such sites are worth hundreds, maybe thousands of dollars. But there's a market worth approximately US$5 trillion waiting to be tapped where one transaction could make millions of dollars.
This industry may not be as glamorous as bidding on a Roosevelt Hotel Menu autographed by baseball greats like Babe Ruth, Lou Gehrig, and Roy Campanella, where bidding starts at a staggering US$10,000, but it sure supplies you with modern survival necessities such as oil and gas.
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