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Business VoIP: Golden Egg Hidden in Services, Says IDC

  • 23 October, 2006 16:08

<p>NORTH SYDNEY, 23rd Oct 2006 - According to IDC's recent report "Australia Business Voice over IP Services and Equipment 2006-2010 Forecast and Analysis: Golden Egg Hidden in Services." IDC finds that convergence of voice and data over a IP single network in Australia continued with an accelerated pace in 2005 and 2006. However, the IP Phone and IP Private Branch Exchange (PBX) revenue growth is set to slow down to about half the rate of 2005 and 2006, due to competition price squeeze. "Convergence integrators must ensure not to be too reliant on equipment sales revenue and mitigate risks with recurring revenue such as services. Opportunities over the next 5 years will be in managed convergence services, specifically in managed VoIP security, network capacity/support, application management, hosted voice solutions and contact centres," said Landry Fevre, Research Director, Telecommunications.</p>
<p>To compete in the increasingly aggressive market, equipment vendors, ISPs, carriers, service providers and system integrators will have to target specific industrial verticals and provide value and usage based solutions rather than technology solutions. In its research, IDC finds that vendors are introducing VoIP applications along with their IP PBX solutions to provide improved productivity and work efficiency to their customers. "As VoIP market penetration increases and the complexity of deploying applications decreases we expect to see wider use of open standards. In addition we predict the integration of voice functionality into critical business applications that can be deployed out of the box," added Mr Fevre.</p>
<p>From 2005, equipment vendors began to realise the importance of SMB segments and consequently launched a new edition of their signature IP PBX system into the market. IP hosted and IP Centrex are now the most popular VoIP services for small businesses in the market.</p>
<p>IDC expects the IP Phone and IP PBX revenue to grow at CAGR 14.49% to reach A$606.76 million in 2010. The market growth will slow down from 2007, at about half the 2005 and 2006 growth rates with Cisco, Avaya, Nortel and Alcatel leading the way.</p>
<p>The total market revenue of Australian VoIP service, including Managed/Hosted VoIP and IP Centrex will increase to A$462.12 million in 2010 at a CAGR of 39% with Telstra, Optus and a slew of smaller players still tuning their offerings and pricing.</p>
<p>As IP telephony penetration is increasing across companies of all sizes, competition will become increasingly aggressive. Besides providing appropriate solutions, equipment vendors will also need to constantly condense their margin to maintain market share. This becomes more important if they want to lead on the SMB front. Consequently, they need to find additional ways to generate profit, such as VoIP application licensing fee and system upgrade services.</p>
<p>IDC research:</p>
<p>If you would like further information or to purchase IDC research, please contact Gary Clarke, IDC Associate VP of Sales via email or phone 02 9925 2226.</p>
<p>For press enquiries please contact:
Landry Fevre
Research Director, Telecommunications and Consumer Markets
Phone: 61 2 9925 2252
<p>Yue Li
Associate Analyst, Telecommunications
Phone: 61 2 9925 2232
<p>Click here to view the press release online:</p>
<p>Click here to subscribe to IDC press releases and newsletters online:</p>

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