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The IP Centrex/Hosted PBX market is poised for "explosive growth" over the next four years, with revenues reaching approximately $1.3 billion by 2009, according to the crystal ball over at In-Stat.

 

The demand in the small and medium business space, the prime target for these hosted services, has been accelerating for several years, the high-tech market research firm says.

IP Centrex/Hosted PBX is a hybrid of two different voice-switching systems, legacy Centrex and legacy Private Branch Exchange products. "The main drivers for the service include cost savings, an enhanced feature set including mobility and integrated messaging options, ease-of-use, greater control, convergence, and system access via a Web portal," says David Lemelin, In-Stat analyst.

 

However, he noted, "it's worth noting that growth in this market lags significantly behind the dynamic growth we have seen with broadband VoIP in the US."

 

Analysts have been predicting a bustout in this market for quite some time. TMC's very own Fearless Leader Rich Tehrani, way back in 2002, wrote "the reason I'm so high on IP Centrex is simple: It's an application that allows service providers to offer a service that enterprises increasingly need and want and are willing to pay for."

 

(One also notes that either Rich hasn't updated his picture since 2002 or he's aging quite gracefully.)

 

Two factors which seem to be hindering a bigger bustout at this time are the transitory nature of hosted VoIP products (providing business customers the opportunity to trial VoIP before committing to a full VoIP PBX purchase), and the rather tepid marketing approach of the RBOCs in this market to date.

In-Stat's research also found that enhanced feature sets, particularly forwarding service that allow users to always be found and unified messaging that allows control over e-mail and voicemail via a web portal, are beginning to drive demand.

Their Fall 2005 In-Stat survey of over 1,000 randomly selected business telecom decision-makers has indicated that upwards of 30% of medium and enterprise businesses have at least experimented with IP Centrex/Hosted PBX solutions.

The market is focused on customers with 10 to 300 end-users per location, In-Stat found, adding that the sweet spot is SME customers in the 25-60-seat-per-location range.

The report, "Steady Growth Ahead for Hosted VoIP Solutions US IP Centrex/Hosted PBX Services," covers the market for IP Centrex/Hosted PBX.

 
David Sims is contributing editor for TMCnet. For more articles please visit David Sims' columnist page.