Networking giant’s gain is Alcatel-Lucent’s loss, as two vendors trade positions in enterprise telephony standings

Cisco has leapt from number five to number two in the global enterprise telephony market, with Alcatel-Lucent tumbling the other way, a new report has revealed.

The report, by market research firm Infonetics Research, indicates that Avaya shipped more units than any other enterprise telephony vendor last year. Cisco was in second place, followed by Nortel, Siemens and Alcatel-Lucent, which fell from the number two slot last year.

The research also reveals that the market as a whole grew six per cent on 2006 and was worth $9.6bn, (£4.83bn). Shipments of IP desk phones and softphones were up 29 per cent.

Matthias Machowinski, directing analyst for enterprise voice and data at Infonetics Research, said: "2007 ended up being a good year overall for the PBX market, despite rapidly declining sales of TDM systems, which were down over 20 per cent.

“We continue to witness the migration to IP PBXs, but new in 2007 was evidence that end-users are benefiting from IP in a direct and meaningful way. Until now, most of the benefits have gone to the network manager, such as IP trunking – things the user couldn’t care less about. But this is starting to change, slowly but surely."

Alcatel-Lucent had more bad news last Friday after it reported a net loss for the fourth quarter of 2007 of €2.58bn, (£1.97bn), which it attributed to a reduction in the value of assets inherited from Lucent since the merger in 2006. However, revenues for the quarter were up 18 per cent on last year to €5.23bn.

Alcatel-Lucent's operating profit was also up for Q4 to €303m, from a €3m loss during the final quarter of 2006. But the company announced it would suspend its dividend, due to an uncertain outlook for 2008. It also predicted a loss for Q1, which it put down to a seasonal drop in revenue.