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PBX Sales Stagnating while Unified Communications Sales are Soaring

August 25, 2014

Over the course of a year, it appears that the sales of Private Branch Exchange (PBX) devices have slightly sank, while over the same period of time unified communication sales have skyrocketed. In-house private branch exchanges are important for traditional business telephony networks as well as for those using SIP trunking for Voice over IP (VoIP) phone service. For some time there has been competition between in-house and hosted PBX business VoIP phone systems, but this new set of data released by Infonetics Research seems to indicate that the rise of Unified Communications systems has supplanted the role of PBX systems.

According to Infonetics Research's Diane Myers, who serves as the company's principal analyst for VoIP, UC and IMS, “The trends we reported on the enterprise telephony market in the first quarter of 2014 carried over into the second quarter, with the PBX market continuing to take hits as businesses evaluate cloud alternatives and hold onto existing solutions while investing in unified communications applications.”

Purchasing a PBX is always a major expense for any business both in the initial investment and long-term maintenance, which is the advantage that hosted PBX VoIP services (allow a VoIP customer to use a provider's PBX instead of owning and operating their own) held over in-house PBX.

Now with the rise of unified communications, it appears that PBX systems are falling out of favor as two other comparable options with smaller price tags are available. Around the world, PBX revenues dropped by six percent of their figures in the second quarter from a year ago, and have remained relatively flat sequentially having only dropped by about one percent. In the same period of time, PBX shipments have fallen by about three percent.

Overall, the PBX market has not taken a big hit from the rise of unified communications, but this is probably only a matter of time. Myers reports that unified communications has seen a 31 percent increase in global revenue from last year's second quarter statistics. As the unified communications industry continues to grow, it seems more and more likely businesses will choose cloud-based communications over in-house options. Of course, it will still be quite a long time before PBX systems are considered obsolete, and changes within the hosted VoIP industry could even provide a new target market for the industry.

Edited by Maurice Nagle

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