Avaya Soars to Leadership Positions in IP Telephony Market

BASKING RIDGE, N.J. — Avaya Inc. a leading global provider of communications networks and services for businesses, today announced it has garnered leadership positions in the Internet Protocol (IP) telephony market, a status it achieved through significant increases in market share, and rapid growth that outpaced competitors in this emerging technology market.

The statistics, which measured growth in enterprise IP telephony for the third calendar quarter of 2002, reflect Avaya’s commitment to delivering leadership in voice communications in the IP arena. Avaya now ranks number two worldwide — with 22 percent of the overall IP telephony market — according to global figures provided by Synergy Research Group’s report on Enterprise Voice over IP (VoIP). The report also notes that Avaya grew faster than its competitors, increasing its total IP telephony lines shipped worldwide by 83 percent, from the second quarter of 2002 to the third quarter of 2002.

Statistics measuring the United States IP telephony market confirmed that Avaya emerged as the number one vendor in IP telephony, capturing 25 percent of the entire market. The figures — supplied by InfoTech’s recent InfoTrack for Enterprise Communications Report for the third quarter of 2002 — showed that Avaya took the leadership position in the U.S. overall IP-PBX market, with total shipments up by 169 percent from the third quarter of 2001 to the third quarter of 2002. InfoTech’s InfoTrack provides quarterly updates on total shipments of IP-based products, a significant indicator of leadership in the IP telephony sector.

“Businesses around the world are increasingly making the decision to strategically deploy IP telephony to drive greater value from their communications networks,” said Don Peterson, chairman and chief executive officer, Avaya. “Clearly, when the decision is made to take the path to IP telephony, more enterprises are choosing Avaya. By bringing our vast experience in voice communications systems, applications and services to the world of IP, businesses of all sizes can begin to experience the benefits of convergence — for about the cost of a standard PBX upgrade.”

By combining disparate voice and data networks, IP telephony brings businesses to a new level of communications, enabling enterprises to collaborate using audio, video and data, wired and wireless voice — all over a single IP packet network. Through Avaya’s IP telephony solutions, businesses can gain access to an array of benefits, including reduced network management costs, increased organizational productivity and enhanced mobile communications capabilities. Mobility tools made possible by Avaya’s vast portfolio of voice applications — such as such as 6-party conferencing, single-mailbox access to voice mail, email and fax messages via PC or telephone, speech-enabled access to desktop tools like calendars, tasks and directories, and extension-to-cellular — enable an entire workforce to gain continuous communications, expanding employees’ desktops beyond office walls to wherever they happen to be working.

The increase in Avaya’s IP telephony market share in the third quarter of 2002 was fueled by a range of businesses, including a significant number of small organizations that adopted Avaya’s IP telephony products and solutions at a rapid pace. The introduction of Avaya(TM) IP Office — which provides small-medium sized businesses with an “all in one” converged system — helped contribute to Avaya’s leadership position in U.S. IP telephony. Since its launch in early 2002, more than 9,000 Avaya IP Office systems have been shipped.

“These results show that Avaya continues to build on its leadership position in IP Telephony, producing significant market share gains in the quarter,” said Jeremy Duke, founder and principal analyst, Synergy Research Group. “In the third quarter, Avaya effectively executed on its strategy to provide a wide range of next generation communications solutions addressing the needs of organizations — from small startups to large corporations and educational institutions — through its MultiVantage software and IP Office products.”

Companies and organizations implementing Avaya’s converged communications and IP telephony solutions over the past year represented a range of industries and sizes. They include the global accounting, tax and business advisory firm Grant Thornton; full-service financial institution OmniAmerican Credit Union; The Seattle Times, one of the largest daily newspapers in the U.S.; Australia National University, a premier institution in Australia; the Federation Internationale de Football Association (FIFA) for the 2002 FIFA World Cup(TM) tournament in Korea and Japan; international rock star Rod Stewart’s management team; Jenny Craig Weight Loss Centers; the Boston Celtics of the National Basketball Association; and HomeNet, Inc., which provides comprehensive computer and network services as well as web site design and hosting.

“Our customers look to us to deliver the solutions that meet their business needs, and Avaya’s IP telephony solutions play an important role in fulfilling that demand,” said John Charters, chief executive officer, Expanets. “As Avaya’s largest business partner, Expanets is proud of their accomplishment and will continue to support the rollout of this new and exciting technology for our mid market customers.” Expanets, which offers a wide range of IP voice and data solutions, is the nation’s largest communications solutions provider to the mid market.

Avaya’s strategy for continued IP telephony Leadership
The overall market for enterprise IP telephony is predicted to grow to $4.4 billion in 2006 from $849 million in 2002, representing a compound annual growth rate of 50.5 percent, according to Synergy.

Central to Avaya’s strategy in the IP telephony market is its support of an architecture that is based on open standards technologies and that embraces a multi-vendor, service creation environment. This enables IT managers to develop and integrate best-in-breed IP telephony applications utilizing Avaya MultiVantage(TM) software, a reliable, scalable voice application that enables enterprises to take a strategic path to converged communications based on choice — either through the evolution of an existing network to IP telephony, or through the implementation of new communications technology and equipment.

Supporting its open standards strategy and architecture, Avaya also provides converged applications that help enterprises integrate communications for superior customer responsiveness and efficient decision-making. During 2002, Avaya delivered award-winning software for contact centers and unified communication. These solutions include the Avaya Interaction Center, which enables businesses to manage multi-media communications with customers through channels that include voice, email, fax and web, across multi-site, multi-vendor, multi-protocol contact center networks. The company also introduced Avaya Unified Communication Center, which enhances employee productivity through speech-enabled, web or wireless access to critical communications tools, such as email, messages, calendars and directories from any phone, personal computers or personal digital assistants.

Avaya Global Services is a single point of accountability with a comprehensive set of service solutions for enterprise customers with mixed environments. These solutions include network assessment for converged environments, an enterprise networking security practice, LAN/WAN assessment, implementation services, as well as maintenance and remote monitoring for both voice and data.

To complement that momentum, last week the company’s new advertisements began appearing in leading trade and business publications throughout North America. The ads encourage customers to “reach Avaya — a higher plane of communication,” inviting organizations to use Avaya solutions and services to reach a “higher plane” or “business nirvana” — a world where companies realize the full potential of their communications networks to achieve superior business results.

For more details on the strategic approach Avaya recommends for businesses evolving to IP Telephony, readers can access Avaya’s new report: “Converged Communications: Meeting IT Objectives Through IP Telephony.” The report can be accessed by visiting: http://www1.avaya.com/enterprise/whitepapers/lb1894.pdf.

Avaya IP Telephony Statistics

Leadership
Avaya leadership in worldwide IP telephony market:
Source: Synergy Research Group’s report on Enterprise Voice over IP for the third quarter of 2002. In this quarter, Avaya increased its total IP Telephony lines shipped across the globe, increasing its share in IP Telephony to 22 percent of the worldwide IP telephony market. In its quarterly report, Synergy Research Group provides updates on total enterprise IP Telephony lines/ports shipped — a metric used to measure vendor market share in the IP Telephony arena.

Avaya leadership in U.S. IP telephony:
Source: InfoTech’s recent InfoTrack for Enterprise Communications Third Quarter 2002 Report, stated that Avaya’s converged systems and applications group, and small to mid-size business solutions group, together took over the number one position in the U.S. IP telephony market with 25 percent of line shipments in Q3 2002.

Avaya leadership in US enterprise telephony market:
Source: According to the latest information from InfoTech (third calendar quarter 2002), Avaya is the number one vendor in the U.S. enterprise telephony market, which includes IP-PBX, IP-enabled PBX, PBX and key/hybrid systems as measured by total port shipments. Avaya’s 27 percent share of the overall U.S. enterprise telephony market is a full six percentage points more than its next competitor.

Market growth
Avaya worldwide market growth in IP telephony:
Source: Synergy Research Group’s report on Enterprise Voice over IP for the third quarter of 2002. In this quarter, Avaya outpaced the growth of its competitors, increasing its total IP telephony lines shipped across the globe by 83 percent from the second quarter of 2002 to the third quarter of 2002.

Avaya U.S. market growth in IP telephony:
Source: According to InfoTech’s recent InfoTrack for Enterprise Communications Third Quarter 2002 Report, Avaya took the leadership position in the U.S. overall IP-PBX market in the third quarter, with total shipments up 169 percent from the third quarter of 2001 to the third quarter of 2002. InfoTech’s InfoTrack provides quarterly updates on total shipments of IP-based products — a key indicator of leadership in the IP telephony market.

About Avaya
Avaya Inc. designs, builds and manages communications networks for more than 1 million businesses worldwide, including 90 percent of the FORTUNE 500®. Focused on businesses large to small, Avaya is a world leader in secure and reliable Internet Protocol (IP) telephony systems and communications software applications and services.

Driving the convergence of voice and data communications with business applications — and distinguished by comprehensive worldwide services — Avaya helps customers leverage existing and new networks to achieve superior business results. For more information visit the Avaya website: http://www.avaya.com.