VoIP Driving Growth in Customer Premises Equipment

Continued broadband adoption and VoIP-enabled gateways are helping to grow the market for customer premise equipment (CPE) this year.

The broadband CPE market includes networking hardware such as modems, as well as gateways that provide home networking functionality.

According to a recent report from analyst firm In-Stat the CPE market is expected to report almost 20 percent growth in 2005. In-Stat expects growth for broadband CPE overall through the year 2009.

In-Stat analyst Joyce Putscher noted that, routers will see a slight decline, and modems will be fairly stable due to new subscribers. Gateways are expected be the driver in growth for broadband CPE. Putscher explained that there is a heavier focus on gateways due to the fact that more features are being put into the “one” box. Those features include VoIP support, along with wireless and video, which could provide opportunities for additional revenue for service providers. “However, that said, cable modems are still seeing a good market this year because of E-MTAs and broadband subscriber growth,” Putscher told VoIPplanet.com.

E-MTA (embedded multimedia terminal adapter) is a voice-enabled cable modem. One of the surprises of the In-Stat survey, according to Putscher, was actually a faster migration to E-MTA cable modems than had been expected. Consumers trying out different ‘flavors’ of VoIP are helping to boost the market for VoIP enabled CPE. “The flavor of VoIP depends on what is offered via competition in whatever region a person resides,” Putscher said. “If you live in an area where your cable company is offering digital phone service that is based on Packet Cable standards (instead of circuit switched), that would be one option, versus using a Voice over Net Internet telephony service (such as Vonage that uses SIP).”

“It depends on regional pricing, competition, rebate enticements, etc. as to what will be favored by consumers in any given area.”

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