Canalys – EMEA Enterprise Telephony Market Finishes 2005 with a Flourish

Highlights:-

• Total EMEA enterprise telephony line shipments up 6.3% year-on-year in Q4 2005
• Alcatel moves into number one position with 17% market share
• Siemens falls to second place as speculation over its Com business continues
• Nortel, Aastra and Avaya battle for third position
• The channel accounted for 87% of total shipments in the region

Enterprise telephony line shipments in EMEA increased by 6.3% in Q4 2005 compared to the same quarter in 2004, according to the latest Canalys market estimates. In total over 21 million CPE lines were shipped last year, up 4.0% over 2004 volumes. Growth in line shipments, however, slowed from the annual rate of 7.1% recorded in 2004. The first half of 2005 started slowly, with shipments rising by only 1.9% year-on-year, but the second half of the year finished strongly, up 6.1%. Overall, shipments in Belgium, France, Italy and Sweden declined by more than 6% in 2005, while the emerging markets of the Middle East & Africa and Russia remained the most dynamic, growing by more than 20% year-on-year.

Europe, Middle East & Africa CPE line shipments Market shares Q4 2005, Q4 2004

Vendor Q4 2005 Q4 2004 Growth
Shipments Share Shipments Share Q4’05/
Q4’04

Total 5,766,200 100.0% 5,426,010 100.0% 6.3%

Alcatel 984,180 17.1% 967,860 17.8% 1.7%
Siemens 917,470 15.9% 888,150 16.4% 3.3%
Nortel 612,240 10.6% 492,060 9.1% 24.4%
Aastra 589,230 10.2% 457,120 8.4% 28.9%
Avaya 502,000 8.7% 505,170 9.3% -0.6%
Others 2,161,080 37.5% 2,115,650 39.0% 2.1%

Source: Canalys estimates, (c) canalys.com ltd. 2004-2006 (Table should be viewed in a monospaced font; graphical version available from web site)

Alcatel finished Q4, its fiscal year end, as market leader with 17% share. It grew strongly in Central & Eastern Europe, the Middle East & Africa and Spain. Siemens was second with 16%, but its strongest quarter and end of fiscal year was in Q3. Nortel, Aastra and Avaya completed the top five vendors. Overall for the year, Siemens was the number one vendor in EMEA with 17% share, followed by Alcatel at 16%. The battle for third place is intensifying with Aastra, Avaya and Nortel all competing. Nortel finished the year with a flourish, especially with its CS1000 in Austria, Finland, Russia and Spain. It was the third largest vendor, followed closely by Avaya, which completed the integration of Tenovis during the year and saw a strong upturn in shipments in Germany in Q4. Aastra moved up the rankings into a top five position in 2005 following its acquisitions of EADS Telecom and DeTeWe, adding to the original purchase of Ascom’s PBX business.

Investment in converged voice and data infrastructure accelerated in Q4, continuing the upward trend seen throughout 2005. Shipments of IP lines grew by 54% year-on-year in the last quarter, while shipments of TDM lines declined. “In total, IP lines accounted for 19% of all lines shipped, which is still relatively low considering the hype surrounding convergence over the last few years,” said Canalys analyst Matthew Ball.

“A restrictive factor has been the slow convergence of buying points within organisations, with a continuing split in responsibilities between ICT and facilities departments in the procurement of voice and data,” he added. This issue was highlighted by a panel survey conducted by Canalys among EMEA telephony resellers