Wednesday, January 25, 2006

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InfoTech Report Reveals ‘Business-Value Gap’ In Converged Applications

Business Wire PARSIPPANY, N.J. (January 25, 2006) -- According to a recent study of telecom decision-makers among U.S. enterprises, almost half of those surveyed believe Internet Protocol Telephony (IPT) can enable applications to deliver business value that cannot be achieved by applications running on traditional PBX solutions.

However, the newly released “InfoTrack for Converged Communications (ICC) Converged Applications Report,” which analyzes the market opportunity for IPT systems and hosted IPT services, found that only 12% of those enterprises surveyed currently implement IPT applications that deliver real business-value. This “business-value gap” was even wider among small and medium-sized businesses, where 65% of respondents with fewer than 500 employees believe in IPT-based business value, but only 10% are implementing those types of applications.

Respondents gave the following three reasons for not implementing IPT-based business- value applications:

• There is a need to justify IPT based on hard savings first.
• There is a need to evaluate a variety of converged applications.
• Enterprises are not convinced soft savings can be achieved.

The majority of the participants in this study would prefer to obtain business-value applications from one source: their primary IPT vendor. They also expect vendors to provide at least Level 1 tech support for any applications that run on their primary IPT vendor's system, including third-party applications. However, vendors are not doing much to promote business-value awareness of IPT. Only 11% of the study participants had ever received a proposal for a business-value application from their IPT vendors.

Assuming IPT vendors respond to these user needs, U.S. market revenues for converged applications are projected to approach $6 billion by 2010.

"Most of the IT vendors are not doing an effective job of marketing the business value of converged applications," says Terry White, InfoTech VP and ICC Program Director. "In many cases, the applications designed to deliver business value for specific vertical markets are developed by third parties. Although the manufacturers of IPT systems offer partnering programs for these third-party developers, their applications typically are not an integral part of the converged solutions that are sold and supported by the major IPT vendors."

About InfoTech

InfoTech, part of The Telecom Intelligence Group, publishes four comprehensive, primary research studies each year as part of its “InfoTrack for Converged Communications (ICC)” program. Its “Converged Applications” report focuses on the decision process for these applications, while identifying and analyzing the job titles and functions of IPT convergence decision-makers in end-user organizations. The report also provides insight into 77 features important to different market segments within 13 different applications categories to help technology developers prioritize their offerings along with detailed 5-year forecasts on the 10 most popular converged applications.

InfoTech’s other ICC program studies focus on the decision process for IPT vendor and service selection for three distinct market segments -- large enterprise, mid-market companies and small businesses.

For more information on the ICC program and Converged Applications study please see http://www.accessintel-infotech.com/ICC/applications06.

About The Telecom Intelligence Group

The Telecom Intelligence Group includes market intelligence provider InfoTech; TelecomWeb and TelecomWeb news break; newsletters Wireless Business Forecast, Broadband Business Forecast and Telecom Policy Report; tariff consultancy Tarifica; and the Web-based business-telephony-product database Telecom Tactics.

Contacts:

Mike O'Neill, vice president and publisher, moneill@accessintel.com