The small-business phone market is set for a shake-up this year, with the launch of new products aimed at enticing SMEs away from key systems.
Avaya, Cisco and LG have unveiled products, Norwood Adam is to step up distribution of CTWare's Xpresso telephony suite and Crane is to field LG's Nexer converged gateway.
Both vendors and distributors seem to be targeting the territory of Siemens, Panasonic and Toshiba.
Tim Stone, EMEA voice marketing manager at Cisco, said Call Manager, the vendor's voice over IP (VoIP) product, was aimed at firms with 100-plus users.
Cisco launched Call Manager Express, a low-end product that is built into routers, last October.
"Gartner Dataquest figures show the one to 100 handset market has 55 per cent of the lines and half the revenue in Europe. If we didn't address that we would be neglecting the market," Stone said.
Andrew Saunders, Mitel's head of applications in EMEA, agreed. Mitel was placed third in terms of UK line shipments in the third quarter of 2003, according to analyst firm Canalys.
The vendor's strong performance came despite its relatively small size and concentration on the SME market. At least part of Mitel's success last year came from an installed base of customers ready to be upgraded.
Vendors with installed bases could well find it easier to move into the lower end of the market.
Andy Rawll, product manager at Avaya's SMB Systems unit, which has launched IP Office Small Office Edition, said VoIP is within many SMEs' reach.
"SME customers are a little more entrepreneurial. They don't have the same infrastructure considerations as larger firms. They also have more to gain," he said.
Rawll claimed that applications, rather than low prices, are the best selling point to SMEs. Increased employee productivity and business efficiency are key, he added, as well as the ability to offer customer service solutions.
Craig Walden, LG product manager at Crane, said this is one reason he expects the Nexer to achieve reasonable sales.
"We expect to sell more than 100 units a month," said Walden. "The market for this sort of thing is going up. Penetration of broadband is increasing; there will be five million users by 2006."
But if the low end of the market is where a lot of the action is, why have vendors such as Avaya and Cisco stayed out for so long?
"Big vendors have been busy doing other things," said Saunders. "The technology is becoming easier to implement now."
However, many within the industry believe vendors have stuck to high-end VoIP installations to garner publicity - and the integrators involved usually tend to be highly trained.
Also, larger numbers of smaller deals would be more difficult to support, so it makes sense to move to the SME end of the market later.
"Why are the big guys getting in now? Because there's a market shift, or rather, that's where the market is," said Manny Pinon, sales and marketing director at Norwood Adam, which is looking to sign 25 extra resellers to its CTWare business.
"At the high end, vendors are getting high profiles but limited numbers of customers.
"We've found large corporates often have teams of six to eight people to deal with specific customer services, and they are ideal for systems that people might think of as SME-sized."
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