PALO ALTO, Calif., Nov. 29 /PRNewswire/ -- Businesses are increasingly adopting hosted services to avoid complexities associated with a premise-based solution and for additional capabilities such as unified communication, simple-to-use conferencing and find me/follow me along with cost saving benefits associated with moves, adds and changes and toll bypass.

New analysis from Frost & Sullivan (http://www.frost.com/communicationsservices ), North American Hosted IP Telephony and VoIP Access Services Market, reveals that the market earned revenues $372.6 million in 2005, and estimates this to reach $14.6 billion in 2012.

If you are interested in a virtual brochure, which provides manufacturers, end users, and other industry participants with an overview of the North American Hosted IP Telephony and VoIP Access Service Markets, send an e-mail to Mireya Castilla, Corporate Communications, at mireya.castilla@frost.com with your full name, company name, title, telephone number, city, state, country and e-mail address. Upon receipt of the above information, an overview will be sent to you by e-mail.

With decreasing hardware prices, improved voice quality due to advances in codecs and tight service level agreements (SLAs), hosted services enable businesses with limited budgets and staff to have more efficient communication. Hosted service offers one-stop shopping to businesses that see their communications needs as part of their business process cost.

"Small businesses that account for majority of the end users are likely to continue driving hosted IP telephony deployments," cites Frost & Sullivan Senior Analyst Lynda Starr. "Medium and large businesses' interests in hosted IP telephony and voice over Internet protocol (VoIP) access service are also likely to increase."

Companies that adopt hosted IP telephony typically save 20 to 40 percent on what they would have paid for a premise-based private branch exchange (PBX). When companies have positive experiences with hosted telephony and access services they spur adoption through word of mouth.

While in general, customers have good experiences with hosted services, there may be some perception problems. As some people incorrectly associate hosted IP telephony with voice over broadband and free calling over the public Internet, it is crucial for service providers to educate potential customers about misconceptions they may have. Service providers also have to aid customers overcome negative perceptions of time-division multiplexing (TDM) Centrex, which include concerns over security and problems related to distance from the central office, both of which are not hosted telephony issues.

Most companies are familiar with TDM voice services and already have in place PBX or Centrex services. While some companies may continue using these systems for several years more, many are likely to consider upgrading to, or replacing with IP PBX or a hosted solution.

"As these two systems can coexist, service providers are likely to offer end-user enterprises a hybrid solution of both premise-based and hosted solutions, enabling customers to phase in a hosted solution with a trunking service and existing legacy equipment," notes Starr.

As end users are beginning to consider communications as part of the core competencies of their daily operations and more than just a necessity, service providers need to pitch productivity and problem-solving abilities associated with hosted services.

It is essential that service providers understand enterprises' needs and expectations, and provide a reliable softswitch, security, an excellent track record, and scalability for the network and collaboration capabilities, unified communication, four-digit dialing and presence management to enhance applications.

Therefore, the biggest challenge facing providers of hosted VoIP services is to offer customers a compelling set of features that are not available over a circuit-switched offering, at a pricing model that offers value to the customers and provides adequate return on investment for the provider.

The North American Hosted IP Telephony and VoIP Access Services Market is part of the Communications Services subscription, which also includes research services in the following markets: North American metro Ethernet services, North American wholesale SONET services, and U.S. enterprise telephony equipment services. All research services included in subscriptions provide detailed market opportunities and industry trends evaluated following extensive interviews with market participants. Interviews are available to the press.

Frost & Sullivan, a global growth consulting company, has been partnering with clients to support the development of innovative strategies for more than 40 years. The company's industry expertise integrates growth consulting, growth partnership service and corporate management training to identify and develop opportunities. Frost & Sullivan serves an extensive clientele that includes Global 1000 companies, emerging companies and the investment community by providing comprehensive industry coverage that reflects a unique global perspective and combines ongoing analysis of markets, technologies, econometrics and demographics. For more information, visit http://www.frost.com/ .

North American Hosted IP Telephony and VoIP Access Services Market N01F Contact: Mireya Castilla Corporate Communications - North America P: 210.247.3830 F: 210.348.1003 E: mireya.castilla@frost.com Srividhya Parthasarathy Corporate Communications - Europe P: + 91 44 42044668 E: sparthasarathy@frost.com Sarah Lourdes Corporate Communications - Southeast Asia & ANZ P: +603 6204 5878 F: +603 6201 7402 E: sarah.lourdes@frost.com Surbhi Dedhia Corporate Communications - South Asia, Middle East P: +91 22 2832 4705 Ext: 131 E: sdedhia@frost.comhttp://www.frost.com/

CONTACT: Mireya Castilla, Corporate Communications - North America,
+1-210-247-3830, or fax, +1-210-348-1003, or mireya.castilla@frost.com , or
Srividhya Parthasarathy, Corporate Communications - Europe, +91-44-42044668,
or sparthasarathy@frost.com , or Sarah Lourdes, Corporate Communications -
Southeast Asia & ANZ, +603-6204-5878, or fax, +603-6201-7402, or
sarah.lourdes@frost.com , or Surbhi Dedhia, Corporate Communications - South
Asia, Middle East, +91-22-2832-4705 Ext: 131, or sdedhia@frost.com , all of
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