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September 28, 2011
Virtual PBX: Global PBX Sales Surged in 2010 Driven by the Urge to Increase Productivity
By Rajani Baburajan, TMCnet Contributor
 

After witnessing a downfall in 2009, PBX (News - Alert) systems including virtual PBX sales flourished in 2010, says a recent survey by Eastern Management (News - Alert) Group, a strategic research firm. Global PBX system sales surged to $59 billion worldwide in 2010, $7.5 billion more than 2009.

Global PBX shipments increased 14 percent to a total of 50 million lines or seats. While 2010 sales were strong in North America, growth in that region lagged behind both EMEA and APAC, which remained ahead in total sales as well as Y/Y growth, the report said.

The report, however, says the increased purchase of PBX system by companies during this period equated to a vote for “ratcheting-up employee productivity.” As the unemployment level increased, businesses were forced to do more with less, so the force driving new PBX purchases was businesses’ incentive to cut expenses.

A new PBX, costing $1,200 per seat on average, gave companies permission to hold the line in other areas. The report, based on Eastern Management survey of IT managers, finds that productivity improvement drove 38 percent of all PBX purchases in 2010. This was 15 percent more than those who got a new PBX to replace an “old one”. Moving and company expansion were also factors that were responsible for only a modest proportion of PBX sales worldwide.

Eastern Management Group expects this momentum will continue despite the fact that the developed world’s economy remains stalled. According to the research firm, 2010 may just be the early stage of a PBX upgrade cycle for businesses that, barring the bottom falling out, could last for years. As revealed in the survey, depending on the size of business, between one-third and one-half of all organizations are already in a PBX upgrade cycle.

Among the leaders in PBX market, Cisco had the largest global market share at 19 percent, followed by Avaya (News - Alert) with 15 percent of the market – a significant improvement for Avaya from an 11 percent global market share in 2009. Avaya, which closed its Nortel acquisition in December 2009, had little sales assurance entering 2010, before elbowing its way to success.

Seven companies accounted for about 80 percent of PBX sales in 2010, the report said. However, the 2010 global market shares of Cisco (News - Alert) and Avaya are less than their shares of the North America market which were 35 percent and 23 percent respectively. Alcatel-Lucent had an estimated 55 percent share of the market in its native country of France, while Siemens (News - Alert), a colossus in Western Europe, commanded 16 percent of the overall EMEA market in 2010.

The survey also revealed that nine out of 12 PBX companies performed well in 2010.

Back in June, Infonetics examined the enterprise telephony and unified communications (UC) equipment market, especially those elements that make up the virtual PBX industry. According to the report, the total for all equipment in these areas was $2.52 billion in the first quarter of 2011, which was down 4 percent from the fourth quarter in 2010.

“The global PBX market is typically down in the first quarter following a strong fourth quarter, and 1Q11 was no exception as the overall market dipped 2.6 percent, dragged down by slowing TDM PBX sales as businesses continue to shift to IP,” said VoIP and IMS analyst Diane Myers in a statement.


Rajani Baburajan is a contributing editor for TMCnet. To read more of Rajani's articles, please visit her columnist page.

Edited by Jamie Epstein


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