Eric Krapf's recent posting seems to highlight a Tipping Point in the market. While the article was written as a comment on the progress in migration to IP PBXs, when viewed from the perspective of the adoption of Unified Communications (UC), it may have defined an important shift in the market.
The first tipping point indication is the result of the recent consolidation of the PBX market in North America. The Eastern Management Group analysis of 2010 North America PBX Line Shipments shows that just two vendors account for almost 60% of the station lines shipped: Cisco with 34.76% and Avaya (including former Nortel customers) with 23.33%.
By the way, you can tell this is specifically a PBX market share study since it excludes voice-capable license shipments of open source products (e.g. Asterisk) as well as shipments of products providing "desktop" and "cloud" communication software (e.g. Microsoft Lync and Office 365, IBM Lotus Sametime and Lotus Live, Skype, and many other entrants including 8x8, CallTower, Google, Microsoft Live, AOL, SAP, salesforce.com, et al.).
When viewed from a UC perspective, this highlights a tipping point. Both Cisco and Avaya are moving beyond IP Telephony; Cisco has dropped the term UC and has pretty well buried the term Voice over IP (VoIP) in favor of Collaboration and Video. Avaya similarly is moving away from UC and IP Telephony, with emphasis on their Avaya Flare Experience, using their recent S-1 Public Offering document to describe their company as, "...a leading global provider of next-generation business collaboration and communications solutions."
Thus both companies see future growth opportunities in areas other than simply replacing, adding and maintaining telephones or in saving money on long-distance toll costs. Rather, they hope future growth will come from delivering new value that converts savings in employee labor (aka productivity gains) and other business operating costs (not just IT TCO) into software and services revenues, i.e. UC apps.
The second tipping point indication is from the Tom Nolle post on June 21, titled "Who's Driving the UC Bus?" which says that enterprises are willing to move away from the desktop telephone as the preferred voice communications endpoint for most of their employees.
Tom comments that in a Spring 2011 survey of 277 enterprises, over 70% of them said, "...that their UC investment plan was constrained based on their investment in legacy voice equipment, their black phones in particular." Without that constraint, Tom reports, those 70% "believed they'd very likely scrap phones completely and move to a PC-based form of communication based on headsets." However, the other 30% did not say that the phone was the answer; they preferred to use mobile devices, rather than PCs, as the endpoints and "because they couldn't get mobile VoIP they would 'wait' until mobile technology caught up."
The shift to PCs as the preferred endpoint is not a big surprise, since that is where most information workers spend their workday and since the PC, or its tablet surrogate, is a much more natural video end point device than a telephone, even a phone with a video screen.
As to the mobile device shift, with IM and Presence available on almost all smart phone mobile devices capable of call control features, the mobile device continues to grow as the preferred enterprise communication endpoint. It seems that these 30% of customers are waiting until the VoIP solutions are good enough that they can use the less costly WiFi or data channels on the smart phones (and other WiFi devices) for voice communications, rather than paying for desk phones or large monthly cell bills.
It is important to notice that the PCs, tablets and mobile smart phones all need a UC software platform to deliver the benefits that the customers expect. This has been highlighted in the "UC Options: Who's Offering What?" sessions at Enterprise Connect (and previously VoiceCon); it requires a separate UC software platform to deliver these UC functions (even if that's embedded in a single virtual machine).
In summary, it has taken awhile for UC to move so clearly into the mainstream, where enterprise buyers look for UC platforms that can support their voice communication needs rather than the other way 'round. The first UC products began shipping in 2001; the Gartner’s first Magic Quadrant for Unified Communications was in 2003; Cisco said Unified Communications "changes everything" at VoiceCon Orlando 2006. Whatever starting date you choose, these two reports seem to indicate that the tipping point has already occurred or is very close at hand. Now, as UC moves to the front of the parade, UC shifts from being the challenger to being the target for displacement (want some collaboration or social networking, anybody?). We'll see if it's up to the challenge.
Perhaps you see these same patterns in this market data, perhaps not? Please post your comments below, either way.
