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Slightly clunky mobile VoIP finds only niche usage in enterprises

While showing great promise, mobile VoIP has seen only niche usage in today's enterprise.

Mobile VoIP is making headway in the consumer and hobbyist markets, but it's still just a niche technology in the...

enterprise market.

Some enterprises have made use of the emerging technology to support employees who travel between countries or to improve indoor reception. Widespread use appears far off, however.

"I don't think we've really ventured upstream enough to be in a position where I could classify it as something an everyday business person could use," said Garrett Smith, founder of MobileVoIPReview and director of marketing and business development for VoIP Supply, a hardware, software and services provider. "People are taking notice of the technology, but it's still in that first adopter phase."

In 2007, there were just 7 million mobile VoIP users globally, according to ON World, a San Diego-based consulting firm.

Smith said the number and quality of mobile VoIP providers had grown greatly in the past few years, including consumer mainstays such as Skype, mobile VoIP specialists like mobiVoIP, and enterprise veteran Packet8's MobileTalk. Despite the proliferation of clients, however, all the companies are in an indiscriminate mobile VoIP land grab, he said.

"They are trying to get as many subscribers as possible, and I don't see any of them really distinguishing themselves in a particular market vertical," Smith said. "Everybody is trying to figure out how to differentiate themselves from one another, but they're all going after this enormous pool of customers, whether that's residential, school or businesses."

This rush for customers, coupled with reluctant carrier support, has meant that few mobile VoIP solutions are truly seamless. That lack of seamlessness is a major barrier to widespread enterprise adoption.

"From the executive position, I can tell you from experience … if you add one more piece they have to deal with, they won't do it," said Chuck Serapilio, CEO of Cellution Inc., which works with enterprises to reduce telephony costs. "From an enterprise standpoint, it's all about ease of use."

However, companies with large multinational workforces traveling frequently between countries are actively testing mobile VoIP. Traditionally, a missed roaming signal could mean huge markups. Alternatives included carrying multiple phones or swapping out SIM cards, a hassle for many enterprises with significant European operations.

With mobile VoIP, users can continue to use dual-mode cell phones normally from any Wi-Fi hot spot without incurring extra costs and with low rates for between-country calls.

"For a large media agency, we deployed a bunch of T-Mobile [dual-mode] phones, and they've been trying them in Japan," Serapilio said. "To a company that is really trying to cut costs, it can be wonderful."

One drawback: Step outside those friendly hot spots and service either drops completely or switches back to costly traditional networks.

On the consumer end, there has also been considerable interest in mobile VoIP over 3G data connections, which allows customers to reduce voice-minute usage while routing calls over the wireless data connection. Smith said this was a good way to escape being tethered to a particular Wi-Fi hot spot and allow more natural mobile call behavior, but wireless service providers have been reluctant to allow third-party VoIP to eat away at their revenues.

"We're at a point in the mobile VoIP industry where things could go [either of] two ways," Smith said. "Mobile carriers could embrace it and use it themselves, or they're going to make it increasingly difficult for mobile VoIP providers to operate."

In the latter scenario, Smith said, consumer pushback is likely, with possible legislative action to level the playing field.

Either way, analysts are hopeful for the long-term future of mobile VoIP: ON World predicted that by 2011, those 7 million users would balloon to 100 million. Smith also saw more robust usage in the near future.

"As this becomes a bigger deal, mobile VoIP providers will have to offer more services than just cheap minutes," he said. "Take [mobile VoIP application] Fring, for example. You can do instant messaging, SMS, MMS -- you can even IM your friends."

Even if the full benefits are not yet available, Smith said, now is the time to pay attention.

"If they're not experimenting, they're missing out," he said. "There are enough use cases out there that you can justify working with the technology."

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