Could Next Generation Broadband Tax Help VoIP Providers
Posted by Cloud Net on Tue, Jan 05, 2010 @ 09:36 AM
The government has proposed a 50p tax each month on all fixed phone lines. The reason for this is so that this money can help to fund the development of the next generation of broadband. Lord Carter describes the charge as a "small levy" (which amounts to £6 a year plus VAT) but he predicts that 90% of the UK will have speeds of up to 50mbps by the year 2017.
The report published also aims to get all parts of the country on the same speed levels, as towns and cities have faster speed levels than rural areas. This means certain businesses located in the rural areas are currently suffering a competitive disadvantage; the target for this aim is 2012.
Many people believe that the upgrades will be covered by the broadband providers due to the competitive market and companies trying to become market leaders by offering the fastest speeds. BT is investing £150bn into fibre optic cables that can help to increase the broadband speed of 10Million households (which is about 40% of households within the UK).
How will VoIP providers benefit?
VoIP works with multiple conversations travelling down a single broadband line. This means, for example, that if 10 simultaneous calls are made using one broadband line the tax is still only 50p - whereas with conventional circuits the cost would be £5.00. So effectively VoIP users would be £4.50 a month better off. It isn't a lot but it is just another nail in the coffin of old fashioned telephony.
And of course with improving broadband quality, VoIP services will have even better capabilities with call quality being even closer to perfect and better broadband means more calls can be carried on a single broadband connection.
So it's good news all round for VoIP providers. Thanks Lord Carter - best thing you've done since finding Tutankhamen's Tomb.