VOIP-telephone service: Economic efficiencies and policy implications

The primary purpose of this study is to estimate, empirically, the economic efficiency of voice-over-Internet-protocol (VOIP) technology and discuss how the emergence of VOIP technology is effective in leading to additional competition in US local telecommunications markets. Probit regression analyses, using data from the 2005 Television and Cable Fact Book the Federal Communications Commission and the US Government Census, reveal that the emergence of VOIP technology gives cable operators an incentive to deploy cable telephony in a local market where entry conditions are not favorable to deployment of circuit-switched technology and proliferates competition in US local telecommunications markets.