rating margins, as revenues from voice service decline. That can only be achieved through base-cost reductions, principally in two areas - operating business model and infrastructure capital spending, cost of capital and operating costs. Early research is not yet clear but some sources suggest that, worldwide, revenue losses due to international VoIP amounted to USD 74 billion in 2002, about 7% of service revenues, which stood at some USD 1.04 trillion. 36 As we go forward, there are conflicting views. One US view is that by 2011 revenue losses due to international VoIP bypass will have risen to USD 96 billion - a loss which would represent only 5% of total telecom service revenues of USD 1.8 trillion at that time. 37 This is quite an optimistic view for the incumbents. In opposition are views that the loss could be far higher as major operators (BT, France Telecom/Orange) install new all-IP infrastructure, while the new competitors expand through major capital injections and buyouts by large groups with investment resources (such as the eBay purchase of Skype) for new ISP type business models, where voice is an adjunct service, not the principal offering. In this scenario, the percentage decline in international service revenues due to VoIP bypass could be far larger. Voice tariffs could on average reduce by up to 90% towards "near-zero" tariffs by 2015. This effect would be most marked outside the OECD group due to stronger competition, as migration of voice traffic from circuit-switched to packet-switched networks for all traffic is approached. Although international voice traffic volume would continue to rapidly expand, it could not offset the declining rates in terms of total revenues, even with the growth of the mobile subscriber base in developing nations - due to the tariffs their disposable income affords. In Asia, 2004 VoIP bypass calling revenue amounted to more than 33% of the USD 98 billion spent in China, India, Japan and other Asian countries on international calling. 38 In the US view, by 2011 VoI