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Johanne Torres[November 22, 2004]

Carrier VoIP Equipment Market Up 69 Percent


VoIP-enabling technologies are certainly becoming more commonly adopted in the workplace nationwide. Globally, next generation (next gen) voice product revenue totaled $452 million during the third quarter of 2004—up 13 percent when compared to the second quarter, and up 69 percent year-over-year, according to Infonetics Research’s (news - alert) quarterly market share and forecast service—Next Gen Voice Products.

Even if many other companies are still unsure of going ahead with a VoIP ( define - news - alert) switchover, the trend is becoming more and more common for companies to either converge their current telephony system with IP products and services, or completely switch over to an in-house, or completely hosted VoIP-enabled system. According to the study, the annual revenue from high-tech voice systems is projected to grow from $1.3 billion last year to a whopping $4.8 billion in 2007, representing a strong compound annual growth rate (CAGR) of 39 percent.

“Most equipment categories saw sequential growth this quarter,” said Infonetics Research’s Kevin Mitchell, directing analyst and co-author of the report. “Voice application servers, session border controllers, and softswitches, especially Class 5 licenses and revenue, grew the most. This indicates that service providers are really beginning to change gears, from investing in infrastructure to investing in next-gen equipment that will allow them to offer new services.”

The study reveals a 34 percent remarkable increase of class 5 softswitch revenue to $76 million during the third quarter of 2004. Experts named Nortel as the revenue share leader in the class 5 softswitch space with almost half the worldwide revenue; placing Siemens in the second place. The worldwide media gateway market grew 5 percent from second to third quarter this year, with most growth coming from the ATM switch-based voice gateways.

Infonetics found that Cisco leads in worldwide media gateway revenue market share, but most sales are due to their universal port RAS and are not solely used for VoIP. Sonus earned second place in this category.

The research firm tracks media gateways (Class 5 packet switches, RAC VoIP gateways, ATM switch voice gateways, and packet voice gateways); media servers; session border controllers; softswitches (Class 4 and Class 5 applications); and voice application servers. Forecasts are updated quarterly and cover all regions (worldwide, North America, EMEA, Asia Pacific, and CALA).

Companies tracked in this service include Acme Packet, Alcatel, AudioCodes, BayPackets, Broadsoft, CIRPACK, Cisco, Convedia, CopperCom, Ericsson, Huawei, IP Unity, Italtel, Jasomi, Kagoor, LongBoard, Lucent, Marconi, MetaSwitch, Mera, Netrake, NexTone, Nortel, Nuera, Pactolus, sentitO, Siemens, Sonus, Sylantro, Tekelec, Ubiquity, UTStarcom, Veraz, VocalData, and others.

Infonetics Research

Johanne Torres is contributing editor for and Internet Telephony magazine. Previously, she was assistant editor for EContent magazine in Connecticut. She can be reached by e-mail at


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