North American Business Communications Revenues Continue to Plunge, According to Study

Projecting a grim picture for the North American Business Communications market, IntelliCom Analytics says revenues in the space have plunged by 15.5 percent in the fourth quarter of 2008, compared to the same period a year earlier. In its “Market Performance Dashboard Full Year 2008 Report”, the company states that compared to 2007 levels, the results for this full year declined by 6.6 percent.

 

The telecommunications market is finding it difficult to cope with the changing market scenario, according to the study. As the traditional customers in this space go on a cash saving spree, even the major players in this market are finding it difficult to maintain their revenue streams.

 

According to the IntelliCom report, the market will get better but not before they get worse. The report says the aggregate market revenues are expected to decline by 7.8 percent in 2009 before positive growth resumes in 2010. As the aggregate market revenues begin to grow again, the report predicts major changes in how business communication solutions are delivered.

 

“The market was already trending downward earlier in the year, but the deepening of the U.S. market recession since the credit crisis took hold in October has quickly translated to reduced spending on Business Communications solutions,” said Frank Stinson, partner and senior analyst at IntelliCom Analytics (News - Alert).

 

The report states that platform hardware revenues will continue to decline as providers move away from packaged proprietary appliances to more software-centric alternatives. Also, over the course of the 2010 to 2013 period, revenues from key software applications are expected to outgrow aggregate market revenue growth.

 

The company said last November that the business communications market in North America during the third quarter declined by six percent year-over-year. The company based its study on revenues from premise-based communications platforms, end-user devices and software applications such as contact center, voice messaging and UC solutions. In the company’s “IntelliCom Market Performance Dashboard Third Quarter 2008 Report,” Stinson finds that some businesses, such as Cisco Systems (News - Alert), actually bucked the overall decline.