iQ MAGAZINE

To reduce long-distance costs and streamline communications, many small and medium-sized businesses (SMBs) are adopting IP-based private branch exchange (IP PBX) systems.

• The number of U.S.-based businesses with between 101 and 1,000 employees using IP PBX jumped 43% from 2004 to 2005, according to In-Stat.
• During the same period, IP PBX adoption rose 70% among businesses with between 5 and 100 employees.
• Worldwide revenues for small IP PBX systems (up to 250 lines per unit) grew to $160 million in 2005 from $116 million in 2004, according to a separate report from Dell'Oro Group.

While the market for hybrid PBX systems, which combine IP communications software with legacy PBX hardware, is much larger ($1.2 billion in 2005), Dell'Oro founder and president Tam Dell'Oro predicts that the small IP PBX market will grow 39% in 2006, while the small hybrid PBX market will grow just 13%.

In recent years, SMBs have looked to IP PBX to reduce communication costs, explains David Lemelin, an In- Stat senior analyst. With SMB-targeted systems available for less than $1,000, IP PBX solutions are becoming more affordable.

Professional-services firms with mobile employees, such as real estate companies, tend to adopt IP PBX at higher rates than other SMBs, according to Lemelin. "The follow-me features and unified messaging that IP PBX offers are key to these SMBs," he adds.

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iQ Magazine, Second Quarter 2006