Avaya, Cisco Lead Growing UC Market, Dell'Oro Says

Avaya and Cisco Systems were the top vendors in a unified communications market that saw strong growth in the third quarter, according to Dell'Oro Group. However, while the UC space is doing well in the second half of 2009 and is expected to continue growing in 2010, it will be a while before it reaches the pre-recession numbers of 2008.

Avaya and Cisco Systems were the top vendors in a growing unified communications space in the third quarter, according to research company Dell'Oro Group.

In a statement released Dec. 3, Dell'Oro analysts said more than 70 percent of the vendors in the space contributed to the market's growth in the third quarter.

However, even though the UC market is finishing strong, it will be a while before it gets back to levels seen in 2008, before the global recession hit, according to Dell'Oro Director Alan Weckel.

"The second half of the year is typically stronger for the enterprise voice market, and the third quarter of this year was no exception for the unified communications segment," Weckel said in a statement. "Although we expect vendors to experience strong fiscal year-end results in the fourth quarter of 2009 and 2010, we do not expect vendors' fiscal year-ends to be as strong as they were prior to 2008 for quite some time."

According to Dell'Oro's report, the IP phone space grew 10 percent sequentially, with all segments-including IP conference, IP desk and IP WLAN phones-contributing.

Avaya and Cisco are both looking to build up their UC capabilities. In September, Avaya won an auction to buy bankrupt Nortel Networks' enterprise phone business for more than $900 million, beating out Siemens Enterprise Communications. The move gives Avaya about 25 percent of the enterprise telephony business, according to analysts, outdistancing second-place Cisco, which owns about a 16 percent share.

For its part, Cisco is looking to build up its video conferencing capabilities by buying Tandberg for $3.4 billion. Cisco officials were to decide Dec. 3 whether they have the 90 percent of Tandberg shares they wanted to go ahead with the deal. If not, they will either walk away from it or waive the 90 percent requirement.