Convergence Of Voice, Data Driving IP PBX Market

In one telling measure, revenue growth for IP PBXs was up 50 percent last year and the market segment will grow another 43 percent this year, said Matthias Machowinski, an Infonetics Research market analyst.

"That's a pretty healthy growth especially in a capital spending environment that has been mediocre," he said in an interview Tuesday.

Machowinski, who follows enterprise voice and data markets for Infonetics, said that Cisco leads the "pure IP" market with its Cisco Call Manager family. Cisco has 77 percent of the revenue in that segment with 3Com in the second position with 15 percent market share.

Machowinski defines the pure IP market as server-based or proprietary platforms that employ packet switching to deliver service over LAN and WAN infrastructure to IP endpoints. "The pure IP market is definitely a vendor push," he said. "The vendors believe the convergence of the networks (data and voice) will be the key to the future. They are future-proofing their platforms."

In his study, Machowinski predicts pure IP revenue will grow by 8 percent by the second quarter of next year.

The Infonetics report also breaks out PBXs in a hybrid category, which is defined as platforms designed to deliver services over both copper and LAN/WAN infrastructure. Machowinski said Nortel Networks leads in the hybrid PBX segment with a 29 percent market share. Alcatel follows with a 23 percent market share, then Mitel with 16 percent, and Avaya with 15 percent. Alcatel is strong in both pure IP and hybrid IP market segments in EMEA (Europe, Middle East, Africa) regions.

Infonetics expects hybrid PBX revenue to grow 73 percent by the second quarter of 2005.

While voice and data have been converging in an accelerating fashion in enterprise networks in recent months, Machowinski said the adoption of VoIP is beginning to be a significant driver in hybrid PBX market where he attributed from 20 to 30 percent of growth there as stemming from enterprises moving to Internet telephoning. He noted that enterprises are realizing that IP phones have "great versatility," which makes them increasingly attractive to enterprises.

Infonetics said the overall IP PBX market including both pure IP and hybrid PBXs logged revenues of $89 million in the second quarter, representing an increase over the previous quarter. "As businesses continue down the path of converging their voice and data networks into one infrastructure," said Machowinski, "we expect the IP PBX market to increase 45 percent between the second quarter of 2004 and the second quarter of 2005."

This story courtesy of TechWeb News