IDC Says Market for IP Telephony Will Weather the Telecom Storm

NORTH SYDNEY – FEBRUARY 11, 2003 – It's been a tough year for telecom vendors and carriers as capital expenditures have been slashed and network builds have been scaled back. But new research from IDC takes a fresh look at the overall market for IP telephony and sees positive signs both on the enterprise and service provider side. According to IDCs Worldwide IP Telephony Equipment Forecast 2002-2007, the long-term prospects for voice-over-packet technology remain excellent despite the telecom downturn.


The overall market is projected to increase at a compound annual growth rate of 45% to reach a revenue base of $15.1 billion by the year 2007,noted Tom Valovic, director of IDC's IP Telephony program. IDC is projecting the best growth in enterprise systems such as IP-PBXs. This trend will be mimicked in Australia as the market for IP Telephony really began heating up in the later part of 2002 with vendors such as Cisco, Avaya, NEC, and 3Com all having strong acceptance to their solutions,commented Joel Martin, IDC Australia Research Director for Communications.


For Australia IP TELEPHONY REVENUE, 2001-2007 ($M) go to:

In terms of enterprise solutions, IDC believes that 2003 will present a major window of opportunity for both IP-PBX vendors and carriers looking to roll out IP Centrex and VoIP VPN services. A number of carriers locally, such as Equant, Optus, and WorldCom are expected to make key announcements in 2003.

IDC warns that large telecom suppliers might be tempted to forestall a stronger commitment to next-generation technology to optimise revenue from their existing legacy product base. While this may appear to be a good short-term strategy, it is not one without serious long-term implications. The danger here is fairly obvious: R&D and technology development can fall behind along with the design, test, and installation experience needed to provide a strong transitional capability for traditional customers notes Valovic.

About IDC

IDC is the foremost global market intelligence and advisory firm helping clients gain insight into technology and eBusiness trends to develop sound business strategies. Using a combination of rigorous primary research, in-depth analysis, and client interaction, IDC forecasts local and worldwide markets and trends to deliver dependable service and client advice. More than 700 analysts in 43 countries provide global research with local content. IDC's customers comprise the world's leading IT suppliers, IT organisations, eBusiness companies and the financial community. Additional information can be found at