The European market for premise-based enterprise VoIP applications is expected to show high growth over the coming five years. According to IDC’s Western European VoIP Applications Forecast and Analysis 2007-2011, the market for VoIP applications in Western Europe was worth $194.8 million in 2006; by 2011 this market is expected to have grown to around $2.25 billion, with a CAGR of 63.1%.
On the equipment vendor side, IDC continues to see product revenue move away from a hardware-based revenue model to more of a software and services-oriented revenue model. In reaction, many of the major network equipment vendors are slowly and steadily pursuing a “services and software solutions” business model in an attempt to diversify and reduce the pressure on their otherwise shrinking margins and businesses.
At the same time enterprises are becoming increasingly interested in VoIP applications. For example, as companies start to see that they can bring increased efficiency in the workplace or offer the ability to become more competitive in a marketplace that is already highly competitive. IDC expects that growth in VoIP applications will predominantly be driven from the following areas:
Unified communications applications, Mobility applications tied to IP PBX functionality, Vertically-oriented applications and other applications running on IP PBXs and IP telephones and Enterprise applications tied to IP PBXs
“Despite past and present evangelization by network equipment vendors with regards to VoIP applications in Western Europe, the market for this technology is still fragmented and in its early stages, but the growth potential of this market is huge,” said Rogier Mol, senior analyst, European VoIP Infrastructure.