Avaya Gains Unified Communication Market Share in Q3; Microsoft Falls

Avaya’s share of the unified communications market grew in the third quarter, while competitor Microsoft saw its revenue fall sharply. Much of Avaya’s growth came from double-digit quarterly gains in enterprise voice revenue.

Unified communications is a big market, pulling in an estimated $5.7 billion in revenue in the third quarter, according to a recent report from the Synergy Research Group. By Synergy’s calculations, Avaya is tied with IBM as the third-largest unified communications vendor in the world.

Once you start to unpack that $5.7 billion figure, a compelling picture emerges, with Avaya making important gains in revenue while our competitors battle for increasingly smaller pieces of the pie.

Synergy’s definition of unified communications is pretty broad. It includes business telephony, email, unified communication applications, video conferencing, collaborative digital workspaces and enterprise social networks.

It might be helpful to look at a rough breakdown of each of these market segments, according to Synergy. Enterprise voice takes the lion’s share of revenue, representing nearly 40 percent of the market (or about $2.6 billion in quarterly revenue).

Email software takes 20.3 percent of the market, followed by unified communication applications with 18.5 percent. Video conferencing, collaborative digital workspaces and enterprise social networks together make up the remaining 21.4 percent of the market.

Avaya is the undisputed leader in enterprise voice revenue. Synergy estimates Avaya’s enterprise voice revenue grew 11 percent in the third quarter, compared to the previous quarter.

“These numbers suggest Avaya has stabilized quite a bit,” Synergy President Jeremy Duke told No Jitter.

Thumbnail image for Dell'Oro Global Enterprise Telephony CY12 Rev Share.JPGFY2012 Enterprise Voice Market Share by Revenue (Dell’Oro Group)

Microsoft desperately wants to break into the list of the top 10 biggest enterprise voice vendors worldwide. Synergy estimates Microsoft’s revenue in enterprise voice grew 35 percent year-over-year. Still, that’s barely enough to make a blip on the radar.

Meanwhile, Microsoft lost quarterly revenue in email, and Cisco and Polycom continued to lower the price of their video conferencing systems, leading to higher unit sales but flat revenue.

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