Enterprise Telephony Market Down 14%

The worldwide enterprise telephony market dropped 14 percent sequentially in fourth quarter 2008 to $2.3 billion, with vendor revenue down for all types of equipment — pure IP PBX, hybrid PBX and TDM PBX, according to a new report from Infonetics Research.

The main cause of the decline is the lack of new business creation and business expansion due to the difficult economic climate worldwide, the research firm reported.

Year-over-year, the overall PBX market is up 1.1 percent with the IP PBX segments up and the TDM segment down as the market continues switching over from TDM to IP equipment and the economy tightens up.

Pure IP PBX revenue grew 25 percent worldwide in 2008, sustained by new product introductions such as NEC’s new line of pure IP PBXs.

Alcatel-Lucent and ShoreTel are the only vendors posting PBX equipment revenue gains in the tough fourth quarter, with Alcatel-Lucent’s revenue up 13 percent sequentially, due in part to seasonality, and ShoreTel’s revenue up 1 percent.

Despite a quarterly revenue loss, Cisco maintains its lead in overall PBX/KTS revenue market share in fourth quarter 2008. And, it grabbed the lead for the entire year for the first time as well

“Because of the significantly deteriorating worldwide economic conditions, we expect the overall enterprise telephony market to contract fairly significantly in 2009. Once the world’s major economies start growing again, however, a recovery in the PBX market will follow. We expect the market to stabilize in 2010, resume growth in 2011, and hit double-digit annual growth by 2012,” said Matthias Machowinski, directing analyst, enterprise voice and data, Infonetics Research.

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