North American Enterprise Telephony Equipment Implementation and Management Services Markets

Frost & Sullivan, December 2010, Pages: 94

This strategic analysis is part of Frost & Sullivan’s continued coverage of the enterprise telephony marketplace. Through extensive primary and secondary research, this analysis provides telephony equipment vendors, service providers, value-added resellers (VARs), systems integrators (SIs) and other market participants with a detailed analysis of the telephony customer premises equipment (CPE) services marketplace. Although the study talks about services in the enterprise market in general, service revenue estimates specifically include revenues from installation, maintenance (contractual and time and materials (T&M)), managed and professional services associated with premises-based telephony solutions.

This Frost & Sullivan research service titled North American Enterprise Telephony Equipment Implementation and Management Services Markets provides customer premises equipment (CPE) services vendors with a detailed look at the dynamics of a changing market. In this research, Frost & Sullivan's expert analysts thoroughly examine the following: installations and professional services; contractual break/fix maintenance; managed services; time and material (TM); and moves, adds and changes (MAC).

Market Overview

Slow but Steady Growth Envisaged for the North American Enterprise Telephony Equipment Implementation and Management Services Markets

The North American enterprise telephony equipment implementation and management services market is up for small, but sustainable growth over the next five to six years. It is a mature market that is undergoing several changes as enterprises migrate toward converged Internet protocol (IP) networks and new telecommunication infrastructures. As telephony equipment shipments suffered substantial declines over the past couple of years due to the economic downturn, installation and professional services revenues naturally declined as well. “The slow growth of the North American business sector and the tighter focus on cost savings limited the growth of maintenance and management services in 2008 and 2009,” notes the analyst of this research service. “After hitting bottom in 2009, the enterprise telephony CPE services market is expected to modestly recover in 2010, and gradually return to its normal, single-digit growth rate from 2011 onwards.”

The greater complexity involved in IP telephony architectures as well as the need to minimize downtime associated with voice CPE upgrades are expected to continue triggering greater interest in professional services such as network assessment, planning, and design. Moreover, network/device/application interoperability issues are likely to foster demand for professional services. Trends indicate that contractual maintenance services are expected to experience some growth over the coming years. This is mainly due to the evolution of traditional break/fix maintenance to an enhanced, hybrid form of maintenance that also includes proactive monitoring. A gradual decline in growth rates is also expected due to the growing popularity of more flexible, managed services models. In fact, while the overall telephony equipment implementation and management services market is approaching maturity, managed services continue to show relatively strong revenue growth rates.

Intensifying customer focus on core business competencies, enhanced need for cost reduction, increasing technology complexities, rising customer tendency to mitigate risks, and the introduction of more compelling offerings – stronger service level agreements (SLAs), software upgrades, more flexible terms – are all expected to be key drivers behind the expected double-digit growth rate of managed telephony CPE services. This is encouraging many market participants to use managed CPE services as a key differentiating factor. “Given the current challenging scenario, CPE services vendors and channel partners must carefully implement a series of strategic actions including designing simple and flexible packages; providing supporting tools for customers and sales representatives, to optimize opportunities,” says the analyst. “Apart from this, they must sweeten services deals with equipment financing, clearly set responsibility boundaries, verticalize the services approach, and invest in training their professional services team.”

Market Sectors

Expert Frost & Sullivan analysts thoroughly examine the following market sectors in this research:

By Service Type:

- Internet protocol private branch exchange (IP PBX)
- Time division multiplexing TDM PBX system
- IP desktop phone
- Softphones
- Unified communications (UC)

1. Introduction

1.1 Research Scope and Methodology

1.2 Market Definitions

1.3 Executive Summary

2. Market Characteristics

2.1 State of the Market Snapshot

2.2 Services Statistics Snapshots

2.3 Market Engineering Measurements

2.4 Industry Challenges

2.5 Market Drivers

2.6 Market Restraints

2.7 Main Market Observations

2.8 Service Findings –Implementation Services

2.9 Service Findings –Contractual Maintenance

2.10 Service Findings –Managed Services

3. Market Size and Forecasts

3.1 Factors Affecting Demand and Revenue Forecasts

3.2 Forecast Assumptions

4. Revenue Forecasts

4.1 Total Revenue Forecasts

4.2 Percent of Revenue by Type of Service

4.3 Installation & Professional Services Revenue Forecasts

4.4 Contract Maintenance Services Revenue Forecasts

4.5 Managed Services Revenue Forecasts

4.6 Time and Material Revenue Forecasts

5. Competitive Analysis

5.1 Competitive Structure

5.2 Competitive Analysis

5.3 Competitive Market Share Analysis

6. Vendor Analysis

6.1 AT&T

6.2 Avaya

6.3 Bell Canada

6.4 Black Box

6.5 Cisco

6.6 Dimension Data

6.7 HP

6.8 IBM

6.9 Mitel

6.10 NEC

6.11 Shared Technologies

6.12 Siemens

6.13 Verzion

List of Figures

Enterprise Telephony Equipment Implementation and ManagementServices Market: Industry Challenges Ranked in the Order of Impact (North America), 2010-2016
Enterprise Telephony Equipment Implementation and ManagementServices Market: Market Drivers Ranked in the Order of Impact (North America), 2010-2016
Enterprise Telephony Equipment Implementation and ManagementServices Market: Market Restraints Ranked in the Order of Impact (North America), 2010-2016
Enterprise Telephony Equipment Implementation and ManagementServices Market: Revenue Forecasts (North America), 2007-2016
Enterprise Telephony Equipment Implementation and ManagementServices Market: Installation/Professional Services Revenue Forecasts (North America), 2007-2016
Enterprise Telephony Equipment Implementation and ManagementServices Market: Contractual Maintenance Services Revenue Forecasts (North America), 2007-2016
Enterprise Telephony Equipment Implementation and ManagementServices Market: Managed Services Revenue Forecasts (North America), 2007-2016
Enterprise Telephony Equipment Implementation and ManagementServices Market: Time and Material Revenue Forecasts (North America), 2007-2016
Enterprise Telephony Equipment Implementation and Management Services Market: Competitive Structure (North America), 2009
Enterprise Telephony Equipment Implementation and Management Services Market: Perception of Vendors By Competitors/Partners (North America), 2009
Enterprise Telephony Equipment Implementation and Management Services Market: Company Market Share By Total Revenues (North America), 2009

List of Charts

Enterprise Telephony Equipment Implementation and Management Services Market: Telephony CPE Service Segmentation (North America), 2009
Enterprise Telephony Equipment Implementation and Management Services Market: State of Market (North America), 2009
Enterprise Telephony Equipment Implementation and Management Services Market: Revenue Splits (North America), 2009
Enterprise Telephony Equipment Implementation and Management Services Market: Market Engineering
Measurements (North America), 2009
Enterprise Telephony Equipment Implementation and Management Services Market: Managed Services
Usage Trends (North America), 2010
Enterprise Telephony Equipment Implementation and Management Services Market: Demand for Managed
Services By Vertical Segment (North America), 2010
Enterprise Telephony Equipment Implementation and Management Services Market: Managed Services Packaging
(North America), 2010
Enterprise Telephony Equipment Implementation and Management Services Market: Revenue Forecasts
(North America), 2007-2016
Enterprise Telephony Equipment Implementation and Management Services Market: Percent of Revenues by Type of Service (North America), 2007-2016
Enterprise Telephony Equipment Implementation and Management Services Market: Installation/Professional Services Revenue Forecasts (North America), 2007-2016
Enterprise Telephony Equipment Implementation and Management Services Market: Contractual Maintenance Services Revenue Forecasts (North America), 2007-2016
Enterprise Telephony Equipment Implementation and Management Services Market: Managed Services Revenue Forecasts (North America), 2007-2016
Enterprise Telephony Equipment Implementation and Management Services Market: Time and Material Revenue Forecasts (North America), 2007-2016
Enterprise Telephony Equipment Implementation and Management Services Market: Company Market Share By Total Revenues (North America), 2009

-AT&T
-Avaya
-Bell Canada
-Black Box
-Cisco
-Dimension Data
-HP
-IBM
-Mitel
-NEC
-Shared Technologies
-Siemens
-Verzion

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