VoIP Continues Meteoric Rise

Voice-over-IP (VoIP) continues to enjoy stellar growth and is one of the few bright spots on the IT landscape, solution providers said.

A research report issued this week by Synergy Research Group concurs that VoIP sales are on the rise. According to the report, the worldwide enterprise IP telephony market grew about 75 percent in the second quarter of this year to $728 million, up from $414.7 million the same quarter last year.

"VoIP is the only sexy thing out there right now," said Jim Gildea, president of Aegis Associates, a solution provider in Watertown, Mass. Aegis' VoIP sales are built primarily around technology from Cisco Systems, and have doubled over the last year, Gildea said.

ROI Networks, an 18-month-old solution provider in San Juan Capistrano, Calif., has grown its convergence sales and service revenue by 500 percent year-over-year, said Jeff Hiebert, CEO of the Avaya partner.

One of the primary drivers for VoIP is server consolidation, or the ability for businesses to deploy and manage IP telephony systems and applications centrally using survivable gateways in remote locations, Hiebert said. This enables branch offices to enjoy the same features and functionality as users at headquarters, unlike traditional telephony deployments where each branch's system had limited functionality.

"It takes the cost and complexity out of branch office deployments," Hiebert said.

ROI Networks' VoIP business is also on the rise because of Avaya's promotions that encourage its legacy customer base to upgrade to IP telephony, he said.

Avaya and Cisco continue to duel for the top spot in the IP telephony market, with Avaya maintaining a slim lead in market share in the second quarter, according to Synergy Research Group. For the quarter, Avaya held 23.9 percent of the market, while Cisco staked out a 23.3 percent share, according to the report.

Other drivers of VoIP sales include cost savings, productivity gains and mobility features, solution providers said.

"It's all about IP today. No one calls and asks us about anything but IP," said John Graven, COO of Computer Telephony Concepts, a solution provider in Cleveland, that works with vendors such as 3Com and AltiGen Communications. Graven noted that requests for IP telephony are up 75 percent over the last year. "It's mainstream," he added.

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