New research: Most international Voice-over-IP calls travel to developing countries

• Latin America and Asia account for nearly 60 percent of international VoIP traffic
• High settlement fees in developing markets explain much VoIP traffic growth

Results from TeleGeography's annual traffic study show that calls to developing countries account for the majority of international Voice-over-Internet Protocol (VoIP) traffic. Calls to Latin America and Asia represented nearly 60 percent of all international VoIP traffic. In contrast, calls to Europe, which normally account for over 40% of total world traffic, accounted for only 24 percent of international VoIP minutes. Within Asia, China, the Philippines, and India were the top three destinations; calls to developed markets such as Japan and Australia barely registered.

According to TeleGeography 2004, costly settlement fees—the charges a carrier levies to terminate a call on its network—account for one factor driving VoIP growth. The use of VoIP mechanisms often permit carriers to skirt high settlement fees. Carriers tend to use traditional, circuit-switched mechanisms for sending calls to mature markets where settlement fees are low. However, carriers increasingly rely on VoIP to avoid settlement payments in many developing markets where those fees remain high.

Source: PriMetrica's TeleGeography 2004 report