By Sharla Sikes

VoIP is a relatively young industry—young in the terms of it becoming mainstream, that is, not the technology itself. When it first became widely accepted, there were many small, independent providers of the service.

Now, recent trends show more and more consolidations, as larger telecommunications firms snap up the independents and startups.

VoIP has continued to grow despite today’s uncertain economy—whether in spite of it, or because of it. As the market grows, corporations may battle for market share in one of the “sure bets” for the moment.

Business and financial adviser Grant Thornton, in a report on VoIP convergence based on Frost & Sullivan research, expects VoIP convergence and the resulting competition will be “fierce.” The market may create as much as £13.5 billion, or $26.7 billion U.S. dollars, in the next two years, according to the report.

Grant Thornton also forecast that VoIP might bring the “death knell” of traditional phone service, as both individual consumers and small to medium businesses switch their phone service to VoIP.

“VoIP is no longer next generation telephony, it is here now and 2008 should see strategic acquisitions of independent software developers and ISPs [independent service providers] by large telcos looking to consolidate their VoIP offerings,” said Sarika Patel, head of technology at Grant Thornton.

VoIP subscribers doubled in 2006 and increased fourfold in the last two years, according to Patel. She says the worldwide customer base may top 250 million in two more years.

All that growth brings about new methods and values.

“There is a bitter turf war taking place in the fragmented market of service provision, particularly for customer ownership,” Patel said.

The hot targets in the “land grab” may include smaller residential and enterprise ISPs as well as resellers, the report says.

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