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IDC Adds Fuel to the Fire on UC Investments

Here's some more data to toss into the fray in the ongoing discussion about UC adoption, though with a slightly different approach. In reporting on 2007 worldwide IP-PBX line shipments, Nora Freedman of IDC notes that Unified Communications, particularly the new packages from Microsoft and IBM, didn't slow down growth for IP-PBX stations. The IDC release on the study took a pretty provocative tone, too:

Here's some more data to toss into the fray in the ongoing discussion about UC adoption, though with a slightly different approach. In reporting on 2007 worldwide IP-PBX line shipments, Nora Freedman of IDC notes that Unified Communications, particularly the new packages from Microsoft and IBM, didn't slow down growth for IP-PBX stations. The IDC release on the study took a pretty provocative tone, too:

Despite escalating buzz and hype around the unified communications (UC) solutions from Microsoft and IBM, these solutions have had minimal impact on the growth of IP telephony lines, which recorded shipments of 30.9 million in 2007, a new study from IDC reveals.

Responding on his Nortel blog, Bo Gowan makes the very valid point that, "The absence of a cratering IP-PBX market shouldn't be much of a surprise to anyone--even Microsoft doesn't expect people to rip out their phone systems and replace them with OCS [Office Communications Server] anytime soon." Which is certainly true. Nobody rips and replaces, and nobody expects anybody to rip and replace.

But what Microsoft is hoping--although they certainly will never say so--is that OCS overhangs the IP telephony market and freezes investment. Microsoft knows as well as everybody else that voice communications purchases are still 10-year investments, at a minimum, and every customer that makes a commitment to Cisco or Nortel or Avaya or any other IP-PBX today is a customer that won't consider OCS for this role for a decade. So they want as many customers as possible to put off that commitment.

What Nora's data seems to be showing is that this isn't occurring--or at least it didn't occur in 2007. Remember, the name of the product may be OCS 2007, but Microsoft actually announced it in 2006. We've actually known for quite a while that it was coming.

My gut tells me that 2008 has been a pretty good year for the concept of UC gaining mind share, so I'll be interested to see Nora's results this time next year.

So far, the numbers (from Blair Pleasant) tell me that mind share is about all UC had in 2007--just $200 million total market size. And, as I wrote over at my InfoWeek blog, Blair's numbers project that UC will remain a relatively small fraction of the overall IP communications market through 2012--less than $2.5 billion for UC out of a total $16 billion overall communications market.