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Report: IP Telephony to Earn $1.76 Billion in Asia Pacific

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September 11, 2008

Report: IP Telephony to Earn $1.76 Billion in Asia Pacific

By Anshu Shrivastava, TMCnet Contributor

The Asia-Pacific enterprise telephony market reportedly will grow by 9.4 percent to reach revenues of about $2.98 billion by the end of this year, according to a new report published by Frost & Sullivan (News - Alert).

The report expects IP telephony to account for 59.2 percent , or $1.76 billion, of this projected growth. In 2007, the report notes that IP telephony (IP-PBX (News - Alert)) accounted for 53.9 percent, or $1.47 billion, of total revenues.
The rest of the 46.1 percent is split between key telephone systems, private branch exchange, and wireless PBX.
The Frost & Sullivan report observes that the main thrust driving IP deployments has been the bridging of present-day enterprise communication needs through the use of next-generation applications.
This latest analysis, “Asia Pacific Enterprise Telephony Market,” says that these next-generation applications enable convenience, cost savings and enhanced productivity.
In 2007, according to this latest report, the market covering 14 Asia-Pacific countries earned revenues close to $2.73 billion, while it estimates that by 2014, the revenues will reach approximately $4.1 billion.
This near-doubling of revenues will happen at a compound annual growth rate of six percent.
Shailendra Soni, senior industry analyst at Frost & Sullivan, said that in developed countries such as Australia, Singapore and New Zealand, IP telephony sales already account for about 60 percent and upwards of the local telephony revenues, with the BFSI (banking, financial services and insurance) sector being the biggest adopters.
He believes tools such as presence, unified messaging and peer-to-peer technologies that ride on IP systems have been some of the reasons for the early deployments, and will likely continue to drive wider adoption of IP telephony.
However, according to Soni, in developing countries, conventional time-division multiplexing systems still dominate the enterprise telephony market. He expects IP telephony to gain increasing traction in these countries.
The report observes that the one of the biggest challenges towards larger-scale uptake of IP telephony is the issue of legacy equipment. Soni said that Asia-Pacific has a very large amount of legacy TDM-based infrastructure.
"The presence of TDM-based infrastructure makes it difficult and costly, particularly for small and medium businesses, to upgrade or replace the existing systems," said Soni.
Also, the slow adoption of the IP telephony is due to the requirement of vendor services. Soni explained that IP telephony deployment typically involves a greater amount of vendor services such as network assessment and network optimization, further slowing down the adoption curve.
Don’t forget to check out TMCnet’s White Paper Library, which provides a selection of in-depth information on relevant topics affecting the IP Communications industry. The library offers white papers, case studies and other documents which are free to registered users. Today’s featured white paper is The Compelling ROI Benefits of Contact Center Quality and Performance Management Technologies, brought to you by Voice Print International (News - Alert).

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

Edited by Michael Dinan

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