Cisco, Mitel and 3Com are Among 2001 VoIP Success Stories.

Business Editors

BEDMINSTER, N.J.--(BUSINESS WIRE)--May 15, 2002

According to a new study from The Eastern Management Group, Cisco outsold all other competitors during 2001 in the market for VoIP equipment - for the moment recapturing the crown from Nortel Networks.

Nortel had seized the number one spot from Cisco in the final quarter of 2001, although Cisco's entrenched position in VoIP systems enabled it to outsell Nortel in 2001 as a whole.

Cisco's share of the market for enterprise VoIP equipment exceeded 25% for 2001. Cisco was the largest vendor in IP-LAN telephony systems, while Nortel dominated the IP-enabled TDM part of the VoIP system market and is quickly emerging as a strong contender in IP-LAN telephony.

"The battle between Cisco and Nortel is currently very close", according to Obi Quasem at The Eastern Management Group. "Their huge installed bases give them both a significant edge over their competitors. Cisco's installed base covers data networking as well as VoIP system customers, while Nortel's installed base includes numerous TDM telephony systems, many of which are ripe for conversion to (or replacement by) VoIP."

3Com was another VoIP success story. As the second largest competitor in IP-LAN telephony, it was Cisco's nearest rival in that part of the VoIP market, and was third overall in VoIP equipment during 2001. Meanwhile, Mitel, which is active in both IP-LAN telephony and IP-TDM, more than doubled its VoIP market share from the third quarter to the fourth quarter of 2001, through a proactive strategy and high responsiveness to market needs.

For 2001 as a whole, VoIP installations represented almost 15% of the total enterprise telephony market, with VoIP penetration actually exceeding 20% in the final quarter. Much of this growth was at the expense of traditional TDM systems. Siemens, a major VoIP system vendor, was among the winners in the TDM telephony market. While most vendors suffered significant reductions in the total number of TDM lines shipped in 2001, Siemens bucked the trend by increasing its TDM shipments by more than 4%.

The Eastern Management Group expects continuing rapid growth in VoIP systems, with VoIP equipment reaching 33% of the enterprise telephony market in 2002. With increasing integration between voice and other services such as video, data, and fax, The Eastern Management Group expects amalgamation between traditional voice players and companies with data and video heritages, as well as the rise of a new class of multimedia vendor.

Inquiries and orders for The Eastern Management Group's newest study can be placed with Obi Quasem at [e-mail] or [phone].

The Eastern Management Group is one of the oldest and largest management and technology consulting firms focused exclusively on the communications industry. For almost a quarter century, The Eastern Management Group has served over 400 communications industry clients worldwide including every major carrier, manufacturer and software company. The Eastern Management Group has offices in the U.S. and Japan.

For more information, please contact Obi Quasem at The Eastern Management Group ([e-mail] or 908-470-6322).