The market for voice services has changed, with the recent introduction of VoIP phone systes. A big part of that change has to do with a relatively new industry-standard protocol: Session Initiation Protocol, or SIP. First developed in 1996, SIP is used in telephone systems to create, modify and terminate sessions between callers.

SIP’s acceptance by the 3rd Generation Partnership Project (3GPP) as a permanent element of the IP Multimedia Subsystem (IMS) architecture has helped this humble protocol play a large role in the evolution of telephone systems from legacy time-division multiplexing (TDM) technology to an all-IP (Internet Protocol) future.

Just how big a role is SIP playing? ABI Research recently predicted that SIP services will become the norm after 2010, dominating telecom markets around the world. By 2012, ABI further projected, nearly half of all telecom users will be hooked up to at least one SIP-based service.

The success of SIP as catalyst for change among telephone systems will generate more than $150 billion in annual service revenue, with cumulative infrastructure capital expenditures of more than $10 billion by 2012, ABI also predicted in its report.

SIP, in short, is helping to accelerate a move to VoIP phone systems and other types of IP-based communications applications.

Not that this migration will necessarily be an easy one; ABI analyst Ian Cox noted that making the move to all-IP is complex. For mobile operators, at least, SIP is helping with the process of optimizing VoIP traffic until LTE or HSPA is introduced. This is achieved with an IP overlay based on SIP.

The cool thing about this approach is that it, in a sense, fundamentally changes how telephone systems work and what they’re capable of doing. For example, using SIP it’s possible to develop Web services and delivery platforms that bringIMS into the network.

“Using SIP, telephony becomes another Web application, which can be integrated into other Internet services,” Cox said in a statement. “It allows service providers to build converged voice and multimedia services.”

SIP is becoming a necessity both for providers and for telephone systems equipment manufacturers. This will only become more true in the future, as the base of VoIP subscribers grows. ABI predicts that, by 2012, there will be nearly 1.2 billion active VoIP users.