By Sharla Sikes

We’ve already talked about the VoIP growth rates in the United States, which are somewhat driven by the uncertain economy. But Canada is seeing growth in numbers of VoIP users, as well.

Up to 44 percent of voice subscribers in Quebec were VoIP customers by the end of last year, according to a study by Leger Marketing. Only 1 year before, that number was only 16 percent.

“We were surprised when we saw the results,” said Najoua Kooli, a project director with the Montreal-based research firm. “Traditional phone use was expected to drop in the coming years and we’re already starting to see it.”

VoIP technology is relatively new in Quebec, having become available in 2005. Industry professionals attribute the growth to demographics and says the growth is similar across Canada.

“As Generation Y increases its influence on the market these numbers will only continue to grow,” commented AR Communications technology analyst, Carmi Levy. “The understanding of what phone service is is very different among the generation that has grown up among the Internet.”

Lower cost and included features makes VoIP attractive, as current users well know. Traditional phone providers are suffering from the decreased market share.

 “Eventually everything is going to be VoIP,” said VoIP analyst, Jon Arnold, of J Arnold and Associates. Arnold also noted, however, that “it’s going to be a long time before that happens and the telecom companies … will want to milk the landline business as long as they can.”

Initial troubles with call quality may have slowed adoption rates. Dropped calls, echoes and static plagued calls.

However, for those willing to give it another chance, recent improvements in software and equipment have vastly improved call quality. Some still balk after those initial problems as well as unfamiliarity, and Vonage Canada vice-president Joe Parent called sales an “uphill battle.”

“The breakthrough was when the cable companies came into the market [in 2005] and validated Vonage’s business model,” says Mr. Parent. “And also more recently with the deregulation of the residential market in Canada.”

Now, instead of battling hesitant customers, VoIP providers are battling each other.

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