IDC predicts boom year for IP telephony

According to the analyst body, 2003 will present a window of opportunity for IP-PBX vendors and carriers looking to roll out IP Centrex and VoIP virtual private networks (VPNs).

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By  Greg Wilson Published  February 1, 2003

Despite a tough year for telecoms vendors, IDC is predicting an upturn in the IP telephony market. According to the analyst body, 2003 will present a window of opportunity for IP-PBX vendors and carriers looking to roll out IP Centrex and VoIP virtual private networks (VPNs).

“The overall market is projected to increase at a compound annual growth rate of 45% to reach a revenue base of US$15.1 billion by the year 2007," comments Tom Valovic, director of IDC's IP Telephony program.

IDC is projecting the best growth in enterprise systems such as IP-PBXs. For this year, the current forecast shows a 66% increase in equipment sales to enterprises.

A number of carriers such as Verizon, SBC, and WorldCom have already made key announcements in 2002. This is where softswitch experience in other areas can have direct application, although organisational barriers will pose knowledge transfer challenges for many carriers.

The report also warns that large telecom suppliers might be tempted to forestall a stronger commitment to next-generation technology to optimise revenue from their existing legacy product base. While the IDC report notes that this may appear to be a good short-term strategy, it is not one without serious long-term implications.

“The danger here is fairly obvious: R&D and technology development can fall behind along with the design, test, and installation experience needed to provide a strong transitional capability for traditional customers,” Valovic adds.

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