Unified Communications Market Headed Upward

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Like many other sectors of the economy, the market for unified communications in 2009 was not a great one, though the future is looking bright.

Infonetics Research has released a new report which forecasts worldwide revenues for the unified communication market will drop by four percent in 2009, but will rise by more than 100 percent over the next four years to top $1 billion by 2013.

Matthias Machowinski, directing analyst for enterprise voice and data at Infonetics Research, told InternetNews.com that he’s expecting the unified communications marketplace to generate revenues of approximately $501 million for 2009. By contrast, Machowinski noted that he is modeling 25 percent growth for 2010, which he admitted is aggressive.

Machowinski added that the economy has had a big role to play in the decline of unified communications revenue in 2009.

“Are businesses hiring? Are they expanding and are new businesses being created?” Machowinski said. “Then do companies have the money to upgrade equipment and all those things have been negatively impacting the market in 2009.”

For 2010 and beyond, Infonetics sees growth as function of one key factor.

“The number one factor will be a return to economic growth,” Machowinski said. “You’re already starting to see employment numbers improvement but we’re still not at the point where we’re significantly adding people to the workforce, but as soon as that happens you will see a return to buying enterprise telephony gear.”

Additionally, he noted that there have likely been some purchasing delays as a function of budgets and as such there is probably some pent-up demand for unified communications gear.

Avaya/Nortel

The overall vendor landscape for unified communications solutions is also changing in 2010. Avaya acquired Nortel in a $900 million deal at the end of December 2009 merging the customers and products of two big players in the unified communications market.

This coming week Avaya is set to unveil its roadmap for the combined company moving forward.

Machowinski noted that with Nortel, Avaya now has tremendous scale as they compete with rival Cisco.

“If you look at the reach they will have it will absolutely change the market dynamics,” Machowinski said. “There will be less competition, especially in North American market. You used to just have Cisco, Nortel and Avaya going at it and it is now becoming just Cisco and Avaya in North America plus some small competitors that focus on certain sectors.”

Cisco hasn’t been sitting idly by in recent months, either. At the end of 2009, Cisco added a unified Presence system to its unified communications offering, leveraging Jabber instant messaging technology acquired in 2008.

Sean Michael Kerner is a senior editor at InternetNews.com, the news service of Internet.com, the network for technology professionals.