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What You Need to Know

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Consolidation in the enterprise telephony market continues as the decisions for investing in unified communications (UC) take precedence over telephony alone. While companies are still deploying PBX and IP telephony, most should make the decision in the context of their broader UC strategy and the emerging availability of communications from within IT platforms.
Gartner has consolidated its three regional Magic Quadrants (North America; Europe, the Middle East and Africa [EMEA]; and the Asia/Pacific region) into one global document. Companies should be sure to differentiate between the regional and global capabilities of telephony players when mapping prospective vendors to their strategies. Although some vendors have global supply and support capabilities, many are only strong in particular geographic locations.

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Magic Quadrant

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Figure 1. Magic Quadrant for Corporate Telephony
Source: Gartner (August 2008)

This document was revised on 15 August 2008. For more information, see the Corrections page on gartner.com.
The market has experienced the greatest level of merger and acquisition activity this decade as it continues to consolidate. The Avaya merger created a private company with investors Silver Lake Partners and Texas Pacific Group (TPG), enabling it to accelerate the changes to its business model that would be more difficult as a public company. NEC acquired Sphere Communications to bolster its service-oriented architecture (SOA) capabilities for a future in UC and has consolidated some of its product management and marketing with NEC Philips Unified Solutions, a European-based company in which it owns a controlling stake. Mitel merged with Inter-Tel to create a larger business targeting small and midsize businesses, but also created a stronger "footprint" to target large businesses. Aastra Technologies continued its acquisition trail with the purchase of Ericsson's enterprise division, creating a larger business focused on small or midsize businesses (SMBs) in Europe and extending the Aastra enterprise footprint for large business.
The role of the IP PBX is also starting to change. We expect that, by 2010, many users routinely will be using an integrated set of collaboration tools beyond telephony, switching among them to reach the highest value combination of communications services inside and outside the firewall, with colleagues, as well as with partners, suppliers and customers, across wired and wireless networks. Presence capability will be fundamental to changing the way users communicate, and although voice will be an important channel in the communications mix, knowing in advance how and when co-workers can be contacted is reducing the value of the functionality of the IP PBX. Consequently, it is increasingly important that companies consider their telephony partners in the broader context of a UC strategy. Companies should take this opportunity to consolidate their investments into a smaller number of vendors, using IP telephony to deliver a consistent platform across the estate of users in preparation for integration with UC and collaboration platforms, especially for branch or small offices and customer service locations (see "Best Practice: Having a 'Big Picture' View of IP Telephony Will Give the Buyer More Control" and "Developing an Enterprise Unified Communications Road Map").
In addition to the market activity, this year's decision to consolidate the three regional corporate telephony Magic Quadrants of North America, Asia/Pacific and EMEA was done for the following key reasons:
- For the past few years, there have been few changes in positioning in the telephony Magic Quadrants. As the market for telephony reaches maturity, there is little room for new regional entrants, and it starts to undertake further consolidation.
- Globalization means that companies cannot continue to just consider vendors by individual regions. If a company based in North America is to communicate with its operations in Asia, then it makes more sense that the technologies selected are from a single supplier to facilitate transparent interconnectivity. Enterprises that operate in particular countries will also benefit from consistent national deployments of global solutions.
- Telephony has become a software application. As a result, regional product differences are disappearing or have disappeared, and distribution of software requires less local infrastructure and increasingly can be managed centrally.

Market Definition/Description
The market for corporate telephony can be described as the provision of holistic voice communications for all wired and wireless users in large enterprises. Typically, this will include multiple sites in multiple locations and often in different countries. This Magic Quadrant focuses on technology providers that design, manufacture and distribute a combination of hardware and/or software products to provide telephony solutions. Their architectures include distributed premises solutions, as well as hosted platforms, but they are essentially dedicated for use by a single company.
As the market evolves from one of proprietary hardware to one of standards-based software, companies will use IP telephony to deliver business benefits across the organization, while consolidating technologies around a common technology or solution provider, or selection of providers and their partners. To meet the demands of this corporate telephony market, suppliers must offer scalable solutions using technologies that leverage Internet-based architectures, but still provide high levels of availability, functionality and integration into IT applications with the voice quality demanded by users.

Inclusion and Exclusion Criteria
To be included in the Magic Quadrant, technology providers had to satisfy the following requirements:
- A demonstrable telephony application that provides holistic call routing and management for large numbers of enterprise voice, including, but not exclusive to, front-office switchboard operations across multiple wired and wireless networks.
- The solution must include the management of media gateways, the connection of IP with circuit-switched-based networks and functions such as call admission control, survivability, codec management, echo cancellation and access to emergency service agencies.
- Evidence of sales, marketing and operational support for corporate organizations, consistently across the globe. Vendors with stronger capabilities in a smaller number of regions still qualify for consideration, but limited market appeal will affect their ability to execute for many Gartner clients.
- Evidence of quantifiable market share in large organizations, specifically information sourced through Gartner Technology and Service Provider Insight analysts.
- The ability to generate significant interest and inquiries from Gartner client segments in the market.

Microsoft was added this year, because Office Communications Server (OCS) 2007 is emerging as a contender for voice communications. Although the telephony in OCS 2007 is not as functional as PBX and IP PBX platforms, and not yet a total displacement, leading-edge adopters of UC have found that OCS 2007 voice capabilities are good enough to meet the needs of many employees, especially nomadic workers.
With the acquisition of Ericsson's Enterprise division, Aastra was also added.

Panasonic, LG Electronics and Samsung were not included because of their local marketing and focus on the installed base of small and midsize enterprises, rather than being providers of large enterprise telephony on a global basis. Vertical Communications and Tadiran Telecom were not included because of their low global profiles as measured by worldwide analyst inquiries.

- Product/Service: Core goods and services offered by vendors that compete in and serve the defined market. This includes current product/service capabilities, quality, feature sets and skills, whether offered natively or through OEM agreements/partnerships as defined in the market definition.
- Overall Viability (Business Unit, Financial, Strategy and Organization): Viability includes an assessment of the overall organization's financial health, the financial and practical success of the business unit, and the likelihood of the business unit to continue to invest in the product, offer the product and advance the state of the art in the organization's portfolio of products.
- Sales Execution/Pricing: The vendor or channel capabilities in all presales activities and the structure that supports them. This includes deal management, pricing and negotiation, presales support and the overall effectiveness of the sales channel.
- Market Responsiveness and Track Record: Ability to respond, change direction, be flexible and achieve competitive success as opportunities develop, competitors act, customer needs evolve and market dynamics change. This criterion also considers the vendor's history of responsiveness.
- Marketing Execution: The clarity, quality, creativity and efficacy of programs designed to deliver the organization's message to influence the market, promote the brand and business, increase awareness of the products, and establish a positive identification with the product/brand and organization in the minds of buyers. This "mind share" can be driven by a combination of publicity, promotions, thought leadership, word of mouth and sales activities.
- Customer Experience: Relationships, products and services/programs that enable clients to be successful with the products evaluated. This includes the ways customers receive technical support or account support. This can also include ancillary tools, customer support programs (and the quality thereof), availability of user groups and service-level agreements.
- Operations: The ability of the organization to meet its goals and commitments. Factors include the quality of the organizational structure, such as skills, experiences, programs, systems and other vehicles that enable the organization to operate effectively and efficiently on an ongoing basis.
Table 1. Ability to Execute Evaluation Criteria
Product/Service |
high |
Overall Viability (Business Unit, Financial, Strategy, Organization) |
high |
Sales Execution/Pricing |
standard |
Market Responsiveness and Track Record |
standard |
Marketing Execution |
high |
Customer Experience |
high |
Operations |
high |
Source: Gartner (August 2008)

- Market Understanding: The vendor's ability to understand buyers' wants and needs and to translate those into products and services. Vendors that show the highest degree of vision listen to and understand buyers' wants and needs, and can shape or enhance those with their added visions.
- Marketing Strategy: A clear, differentiated set of messages consistently communicated throughout the organization and externalized through the Web site, advertising, customer programs and positioning statements.
- Sales Strategy: The strategy for selling products that uses the appropriate network of direct and indirect sales, marketing, service and communication affiliates that extend the scope and depth of market reach, skills, expertise, technologies, services and the customer base.
- Offering (Product) Strategy: The vendor's approach to product development and delivery that emphasizes differentiation, functionality, methodology and feature sets as they map to requirements.
- Business Model: The soundness and logic of the vendor's underlying business proposition.
- Vertical/Industry Strategy: The vendor's strategy to direct resources, skills and offerings to meet the specific needs of individual market segments, including vertical markets.
- Innovation: Direct, related, complementary and synergistic layouts of resources, expertise or capital for investment, consolidation, defensive or preemptive purposes.
- Geographic Strategy: The vendor's strategy to direct resources, skills and offerings to meet the specific needs of geographic locations outside the "home" or native locations directly or through partners, channels and subsidiaries as appropriate for that location and market.
Table 2. Completeness of Vision Evaluation Criteria
Market Understanding |
high |
Marketing Strategy |
high |
Sales Strategy |
standard |
Offering (Product) Strategy |
high |
Business Model |
standard |
Vertical/Industry Strategy |
standard |
Innovation |
high |
Geographic Strategy |
standard |
Source: Gartner (August 2008)

Market leaders demonstrate strength and can affect market trends in all the criteria on which they are evaluated. Leaders tend to have broad geographical coverage across the globe or particular strengths in one or more key global markets.

Challengers demonstrate an understanding of the market and often possess a complete product portfolio and a strong market presence. However, they have not shown an understanding of market direction, or they are not well-positioned to capitalize on emerging trends.

Visionaries display healthy innovation and a strong potential to influence the direction of the market, but they are limited in execution or track record. Typically, their products and market presence are not complete or established enough to challenge leaders.

Niche players often offer strong products for particular geographical or vertical market subsets, but they demonstrate weaknesses in one or more important areas.

Vendor Strengths and Cautions
- VCX Enterprise, 3Com's Linux-based IP PBX product for enterprise organizations, natively supports Session Initiation Protocol (SIP) as the underlying communications protocol across its IP telephony applications. Native support for SIP means that a separate SIP server is not required to support SIP applications on VCX.
- 3Com partners with IBM to sell VCX software on IBM System i servers (now called Power System servers) targeted at small and midsize enterprises, where 3Com enjoys most of its success.
- 3Com's Open Services Networking initiative integrates 3Com voice, data, wireless and security applications, along with those of its partners, into its data infrastructure of switches and routers.
- Strong 3Com vertical markets are education (schools and higher education), local and federal governments, healthcare and retail finance.

- Although its products and technology are considered sound, 3Com has struggled to successfully execute and maintain its go-to-market strategy, especially in regions outside the U.S., where its brand visibility is low.
- The recently abandoned acquisition by Bain Capital and Huawei Technologies would have bolstered 3Com's ability to compete in global markets, especially those that are particularly price-sensitive. In its absence, 3Com's prospects in the enterprise telephony market remain the same in a market that is consolidating.

- With the acquisition of Ericsson's enterprise business, Aastra has bought a sizeable share of the corporate and major enterprise telephony market, with a combined 12.3% share of the corporate and major market segment of Western Europe, fifth place behind Siemens, Cisco, Alcatel-Lucent and Avaya.
- Aastra's focus is primarily on providing reliable solutions for late adopters of technology, although its partnership with Telepo for mobility gateways could enhance the other product portfolios.
- Aastra's 5000 and Clearspan are scalable, standards-based platforms to meet the needs of large European and North American businesses, respectively.

- Aastra is using product platforms to differentiate its approach to meeting regional requirements. It may prove difficult for global businesses to buy a single product in the portfolio across the multiple markets in which Aastra operates. This can also be an expensive way of satisfying customer needs in a market ripe with platform consolidation.
- Aastra's brand recognition with corporate and major enterprises is weak, which limits its appeal to large businesses, as well as global channels to market, and is, therefore, more likely to be attractive to existing customers.
- The business is primarily channel-based, which limits its ability to secure early adopter mind share for UC, unlike competitors that use direct-touch sales and support help to secure new customers.

- Alcatel-Lucent offers scalable IP-based software solutions (OmniPCX Enterprise and OmniTouch Unified Communication) that integrate telephony, multimedia messaging, firewall, collaboration and mobility requirements, and can be deployed as enterprise or hosted solutions.
- The OmniPCX has a strong migration methodology for established Alcatel-Lucent customers and is a credible platform for IP or hybrid telephony environments.
- It is growing its global expertise and resources to help satisfy complex, large-scale requirements for custom IP telephony solutions. These solutions integrate well with Alcatel-Lucent's UC and contact center products, and those from its subsidiary company, Genesys.
- Enterprises in the European and Asia/Pacific market will find that Alcatel-Lucent's channel relationships with network system integrators and network service providers are well-established.

- Despite the Enterprise division's strong financial position, investment for growth is hampered by the unprofitability of Alcatel-Lucent's parent company and the challenges it has in other divisions.
- Alcatel-Lucent is not well placed to influence customers directly in their decisions for UC, especially in areas where most of its channel partners are also Microsoft partners for OCS 2007. This is especially true of North America, where, despite perseverance, Alcatel-Lucent Enterprise has struggled to increase its market share, relying too heavily on a small number of channel partners that also carry competitors' products.

- Avaya's Communication Manager-based product portfolio provides a consistent user interface from site to site, as well as feature transparency, while supporting many redundancy and mobility alternatives. The Linux-based 87XX platform supports high-availability options that can support up to 36,000 users and 12,000 trunks in a single system.
- Avaya's Enterprise Survivable Server enables an organization to protect its communication system against a main server failure.
- To satisfy today's market requirements, Avaya has been expanding its competitive range of media servers, media gateways and telephones, while introducing enhancements to its Communication Manager software, and branch office solutions for the retail and banking vertical markets.
- Avaya is the worldwide market share leader in combined IP telephony and time division multiplexing (TDM) enterprise line shipments. Avaya reports strong growth for IP line shipments in Asia/Pacific, EMEA, Central America and Latin America for small and large systems, with substantial global growth for professional service revenue.
- Avaya's Communication Manager platform supports enterprise solutions that require scalability, support for a distributed environment, various failover options, an efficient management interface, high availability and proactive system monitoring tools. Communication Manager satisfies the requirements of a data center model implementation, and organizations with mission-critical contact center applications can use Avaya as a sole source provider.

- Disappointing IP shipment growth in North America during the first quarter of 2008 has resulted in worldwide head count reductions and some senior management changes. It will take time for these adjustments to yield performance improvements. Companies should maintain close contact with Avaya during the next few months to ensure that the account relationships remain in place or that changes are fully understood.
- Perceptions of premium-priced products require that companies understand the business value of Avaya's solutions to evaluate the investment.
- Avaya has been slow to articulate its vision for software-based telephony and SOA that spans existing and future platforms. Companies must ensure that the proposals and delivery time scales are in sync with integration projects inside the business that plan to leverage SOA.

- Cisco is the global market share leader in IP telephony line shipments to enterprises with Unified Communications Manager (UCM). It continues to execute well in all key geographic regions outside North America, including EMEA and Asia/Pacific.
- Cisco combines strong channels to market via system integrators, service providers and network outsourcers, with an excellent dealer and engineer certification program.
- Overall company viability is a Cisco strength. It has the resources and the cash to continue to develop its UC product road map internally or via acquisition.
- Cisco is particularly aggressive where there's an opportunity to migrate its data customers to IP telephony. In those situations, competitors struggle to match Cisco discounts off the list price.

- Integration between Cisco UCM and Unity messaging or Cisco IP contact center can be complex and difficult for some organizations' implementations. Improvement should come with new software releases.
- Gartner has received some negative feedback on Cisco Unified Workspace Licensing (CUWL) from clients because of premium pricing (over standard IP telephony pricing), all-inclusive cluster licensing and sales pressure to adopt now. Companies should ensure that they understand the full cost of ownership of CUWL and select it once the road map is in place (see "Developing an Enterprise Unified Communications Road Map").
- Having put together its application portfolio from a host of acquisitions, Cisco is still in the process of integrating them into an end-to-end experience.

- Digium's Asterisk, a SIP-based, open-source IP PBX product, is growing in market acceptance and is being used as the base software product for SMB solutions from Aastra and 3Com. It is also used by contact center vendors Aspect Software and Altitude Software as a voice platform or for back-office functionality.
- Asterisk is targeted at organizations with a strong IT operation and a culture for developing and customizing applications in-house, and will be attractive to companies that have already invested in product life cycle management for other open-source technologies (see "Open Source in the Communication Industry, 2008"), although the acquisition of Switchvox will enable the toolset to build more solutions.
- Digium continues to enjoy profitable growth since 2002 and investment by venture capital partners.

- Telephony as an open-source technology still has some years yet to mature (see "Hype Cycle for Enterprise Communication Applications, 2007"). It is increasingly being used as a valuable integration tool between communications and business applications, which require extensive involvement and management by the enterprise.
- Although its ecosystem is growing, with some strong relationships, such as Polycom for handsets, Digium relies on partnerships with many hardware suppliers, which an enterprise must manage using its own resources or those of an integrator for a total solution.
- Companies without strong in-house IT resources and a commitment to open source should consider productized offerings from competitors.

- Through strong marketing for UC and its desktop dominance in many large businesses, Microsoft is encouraging early adopters to use its products to look beyond enterprise telephony to different ways of working, especially for nomadic and knowledge workers.
- Companies with a strong commitment to Microsoft and recognized needs for internal collaboration will find OCS 2007 a viable extension of the existing enterprise PBX or IP PBX network, although not necessarily a replacement.
- Microsoft has huge resources and strong finances to commit to the research and development of UC products and to sustain it as a long-term player.

- The telephony component of OCS 2007 lacks key functionality, such as attendant operator, survivability and emergency services support, taking it out of the running as an all-out replacement for a PBX or IP PBX until at least 2010. It's also yet to be proved as a scalable and resilient platform.
- The aggressive time frames for delivering further telephony functionality may be challenging. Microsoft has just started delivering new software products on time with the level of quality expected by the IT department managing IP telephony projects.
- OCS is expensive for just telephony functionality. Companies should target the software to employees who will benefit from the broader UC capabilities.

- The acquisition and integration of Inter-Tel has strengthened Mitel in size and in its opportunity to execute.
- Mitel is particularly strong in deployments for midsize enterprises.
- Mitel has a large, diversified and global distribution capability comprising a combination of direct and indirect sales and support operations.
- The Mitel 3300 IP Communications Platform (ICP) and its associated applications and management suite are Mitel's flagship products for the enterprise segment. They are complemented by the Mitel Communications Suite (MCS), a preintegrated UC solution that runs the 3300 ICP software on Sun Microsystems servers.

- Mitel is not strong in large enterprise telephony because it has been slow to scale the architecture of the 3300 ICP to cost-effectively serve large campus environments.
- Although Mitel's acquisition of Inter-Tel became final in 2007, some confusion exists among Mitel field personnel and dealers concerning which company has responsibility for account management. Mitel and former Inter-Tel customers report that responses to requests for sales and technical support have improved recently, but companies should maintain close contact with Mitel to ensure that account relationships remain in place or that any changes are fully understood.
- Mitel has not been profitable during the past several years because of significant investments in R&D and geographic expansion. The lack of profitability has also resulted in staff reductions. With the acquisition of Inter-Tel a profitable company Mitel is on course to turn that around.

- NEC is a global player with a multicountry marketing approach to branding for telephony products sold through its global Enterprise Solutions business unit: NEC in Japan, Asia and Australia; NEC Unified Solutions in North and Latin Americas; and NEC Philips Unified Solutions in EMEA. Its strengths are in the hospitality, health, government, education, manufacturing and service industries.
- NEC services large organizations directly and through regional channel partners using its own sales and technical support staff. Its large enterprise telephony products have been robust and reliable TDM PBX solutions for more than three decades, with low price leadership in virtually all markets that it has competed in during that period.
- NEC's Univerge SV7000 IP telephony and NEAX hybrid IP PBX platforms are being groomed to move beyond their switch-centric past to integrate more deeply into IT applications and to target business-process-level integration.

- Although NEC was early to market with its integration of Microsoft's Live Communications Server, it has made a virtue out of servicing its large installed base of telephony customers with TDM PBX solutions, rather than marketing IP telephony and UC aggressively, despite its partnering with Microsoft, Cisco, IBM and Unisys.
- In 2007, NEC acquired Sphere, with the goal of developing complex telephony software solutions embedded in IT applications. However, despite a marketing campaign that emphasizes support for these custom solutions, organizations must be certain that NEC can meet the performance and delivery expectations that match business process requirements.
- There are insufficient global channel relationships for effective multinational user support. NEC needs to improve its market penetration among large organizations by increasing the number of dealers certified to represent its enterprise-level products, especially dealers with IT system integrator skills.

- Nortel offers a strong portfolio of telephony systems, including the Communication Server (CS) 1000 and CS 2100 for global deployments, where strong technology and a broad range of product offerings are required for telephony (corporate, branch office and small office), messaging, contact centers, UC, wireless and mobility.
- Nortel has a strong vision for its role in the UC market as a software and service provider of competitive products, and products from partners, such as LG, Microsoft and IBM in addition to its own UC solution built around the MCS 5100.
- In addition to the Innovative Communications Alliance (ICA) with Microsoft, Nortel has announced its SOA-based Agile Communication Environment initiative, which supports multivendor UC interoperability requirements of global enterprises, and its strategic partnership with IBM, which includes joint IBM Sametime/Nortel deployments and associated marketing agreements.
- ICA has delivered the best level of Microsoft integration among the telephony vendors. ICA provides more interoperability with less complexity (vs. competitor integrations) between Nortel platforms, such as CS 1000 and CS 2100, and Microsoft OCS 2007.

- As a result of cost-cutting and employee reduction measures in 2006 and 2007, Nortel's technical support capability has suffered, resulting in fewer resources available to assist channel partners with technical support activities. Companies need to ensure that the skills required for their projects are available from Nortel or to support the channel.
- Nortel's MCS 5100 functionally overlaps with ICA product integrations of Microsoft OCS 2007 with Nortel telephony platforms (CS 1000 and CS 2100). They are similar solutions; for example, the MCS 5100 is typically deployed with a CS 1000 for multimedia collaboration, much as an OCS 2007/CS 1000 integration would be deployed. Companies need to ensure that all their user needs are met with a minimum of overlapping technology.
- Although Nortel's vision for telephony and UC is comprehensive, its execution has not been as good in areas such as sales and services. The increased focus on services has the potential to alienate channel partners that have built businesses around services for IP telephony and UC.

- The ShoreTel telephony system has an IP architecture that can support many users in a widely distributed environment, is inherently redundant and includes intuitive user interfaces for system managers and users. The system can be managed and administered from a central location, and remote sites can be deployed without local assistance.
- ShoreTel has made significant progress growing its installed base of small to midsize customers, which it is leveraging to penetrate larger organizations, including many that are global. In the U.S., it has recently improved its national distribution by adding channel partners AT&T, Black Box and CDW.
- Since launching its initial public offering in 2007, the company has seen a steady increase in revenue and net income while maintaining a strong balance sheet with no debt.
- While ShoreTel has met with success in the SMB market, the company has also been gaining acceptance with larger organizations that have communications requirements for numerous sites of varying sizes.

- Although the ShoreTel system can operate across international boundaries, the company must significantly grow its visibility and shipments outside North America and in global enterprise telephony markets.
- The distributed nature of the architecture lends itself better to large numbers of smaller sites than to large campus environments. Companies may find the cost of deploying and supporting a large number of servers to be prohibitive.
- Although ShoreTel's IP 8000 conference phone is SIP-compatible, and the system supports SIP trunking, all other ShoreTel IP phones only support MGCP. However, with Release 8.0, ShoreTel does support third-party SIP endpoints.

Siemens Enterprise Communications
- Significant investment has been made during the past year in re-engineering Siemens Enterprise Communications (SEN) to be a more financially viable player in enterprise communications. The joint venture with Gores Group enables a fresh start with a clear balance sheet and a cash injection of €350 million (see "Gores/Siemens Joint Venture Is Promising but Faces Tough Market"). The addition of the Enterasys and SER Solutions product portfolio will give the joint venture a larger base of customers to cultivate.
- The joint venture with Gores makes possible a stronger set of go-to-market sales, service and product propositions. Priorities include repositioning the HiPath 8000 as a voice application of OpenScape Unified Communications and creating a global reference price list. Companies that prefer to deal directly with technology providers will align more with the Siemens strategy.
- Stronger-than-average investment in the product portfolio has ensured increased product development, despite reductions in product revenue and much improved solutions for mobility and UC.
- The increased referenceability of the OpenScape Voice Application through the try-before-you-buy scheme is reinforcing the strong vision of SEN as an open software player. Companies with a strong commitment to open implementations will find the product portfolio attractive.

- The Siemens joint venture with Gores still has many unanswered questions concerning the Enterasys and SER roles in the new company, market strategy, product positioning, channel buy-in and how well the new joint venture can execute.
- Migrating customers from the legacy HiCom 300 to the HiPath 4000 portfolio is expensive. Companies may find competitor proposals for forklift upgrades to be a commercially attractive proposition.
- Although the reorientation of SEN is promising, it needs to show customers that it can capitalize on the changes in its service business to eradicate the perception in the market of premium-priced, yet less-than-premium, service.

- In the U.S. and Japan, Toshiba has a long-established reputation for providing reliable system performance, cost-effective price points and clear migration capabilities to IP technology. Its large base of predominately SMB customers is concentrated in the retail, automotive, banking, financial and government vertical markets.
- All Toshiba CIX series systems use the same cabinets and interfaces, providing investment protection for growing organizations.
- Toshiba has a large selection of authorized dealers that covers the entire U.S. and Japan.
- In the U.S., a unique national accounts program, centrally managed by Toshiba for customers, offers uniform pricing of products and services for applications that require deployment across multiple sites, which is ideal for retail locations and branch offices.

- Although parent company Toshiba Corporation is a large, diversified manufacturer and marketer of electronic and electrical products, it does not have a significant presence in the large enterprise market in EMEA, nor does it have a global strategy that focuses on IP telephony requirements outside the U.S. and Japan.
- Toshiba's Linux-based Strata CIX IP telephony series only supports up to 1,000 users and 440 trunks. Although multiple systems can be networked for additional capacity and distributed configurations, the CIX platform has limited redundancy options to support system failures.
The Magic Quadrant is copyrighted
8 August 2008 by Gartner, Inc. and is reused with permission. The Magic Quadrant is a graphical representation of a marketplace at and for a specific time period. It depicts Gartner’s analysis of how certain vendors measure against criteria for that marketplace, as defined by Gartner. Gartner does not endorse any vendor, product or service depicted in the Magic Quadrant, and does not advise technology users to select only those vendors placed in the “Leaders” quadrant. The Magic Quadrant is intended solely as a research tool, and is not meant to be a specific guide to action. Gartner disclaims all warranties, express or implied, with respect to this research, including any warranties of merchantability or fitness for a particular purpose.
© 2008 Gartner, Inc. and/or its Affiliates. All Rights Reserved. Reproduction and distribution of this publication in any form without prior written permission is forbidden. The information contained herein has been obtained from sources believed to be reliable. Gartner disclaims all warranties as to the accuracy, completeness or adequacy of such information. Although Gartner's research may discuss legal issues related to the information technology business, Gartner does not provide legal advice or services and its research should not be construed or used as such. Gartner shall have no liability for errors, omissions or inadequacies in the information contained herein or for interpretations thereof. The opinions expressed herein are subject to change without notice.
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Communication Server |

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Cisco Unified Workspace Licensing |

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Europe, the Middle East and Africa |

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Innovative Communications Alliance |

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IP Communications Platform |

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Mitel Communications Suite |

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Office Communications Server |

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Siemens Enterprise Communications |

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Session Initiation Protocol |

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small or midsize business |

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service-oriented architecture |

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time division multiplexing |

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unified communications |
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Silver Lake Partners is a private investment firm that also owns a substantial, publicly disclosed interest in Gartner, Inc., and has two seats on Gartner's 11-member Board of Directors. Gartner research is produced independently by the Company's analysts, without the influence, review, or approval of our investors, shareholders or directors. For further information on the independence and integrity of Gartner research, see "Guiding Principles on Independence and Objectivity" on our Web site, www.gartner.com.
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We review and adjust our inclusion criteria for Magic Quadrants and MarketScopes as markets change. As a result of these adjustments, the mix of vendors in any Magic Quadrant or MarketScope may change over time. A vendor appearing in a Magic Quadrant or MarketScope one year and not the next does not necessarily indicate that we have changed our opinion of that vendor. This may be a reflection of a change in the market and, therefore, changed evaluation criteria, or a change of focus by a vendor.
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Product/Service: Core goods and services offered by the vendor that compete in/serve the defined market. This includes current product/service capabilities, quality, feature sets, skills, etc., whether offered natively or through OEM agreements/partnerships as defined in the market definition and detailed in the subcriteria.
Overall Viability (Business Unit, Financial, Strategy, Organization): Viability includes an assessment of the overall organization's financial health, the financial and practical success of the business unit, and the likelihood of the individual business unit to continue investing in the product, to continue offering the product and to advance the state of the art within the organization's portfolio of products.
Sales Execution/Pricing: The vendors capabilities in all pre-sales activities and the structure that supports them. This includes deal management, pricing and negotiation, pre-sales support and the overall effectiveness of the sales channel.
Market Responsiveness and Track Record: Ability to respond, change direction, be flexible and achieve competitive success as opportunities develop, competitors act, customer needs evolve and market dynamics change. This criterion also considers the vendor's history of responsiveness.
Marketing Execution: The clarity, quality, creativity and efficacy of programs designed to deliver the organization's message to influence the market, promote the brand and business, increase awareness of the products, and establish a positive identification with the product/brand and organization in the minds of buyers. This "mind share" can be driven by a combination of publicity, promotional, thought leadership, word-of-mouth and sales activities.
Customer Experience: Relationships, products and services/programs that enable clients to be successful with the products evaluated. Specifically, this includes the ways customers receive technical support or account support. This can also include ancillary tools, customer support programs (and the quality thereof), availability of user groups, service-level agreements, etc.
Operations: The ability of the organization to meet its goals and commitments. Factors include the quality of the organizational structure including skills, experiences, programs, systems and other vehicles that enable the organization to operate effectively and efficiently on an ongoing basis.
Market Understanding: Ability of the vendor to understand buyers' wants and needs and to translate those into products and services. Vendors that show the highest degree of vision listen and understand buyers' wants and needs, and can shape or enhance those with their added vision.
Marketing Strategy: A clear, differentiated set of messages consistently communicated throughout the organization and externalized through the Web site, advertising, customer programs and positioning statements.
Sales Strategy: The strategy for selling product that uses the appropriate network of direct and indirect sales, marketing, service and communication affiliates that extend the scope and depth of market reach, skills, expertise, technologies, services and the customer base.
Offering (Product) Strategy: The vendor's approach to product development and delivery that emphasizes differentiation, functionality, methodology and feature set as they map to current and future requirements.
Business Model: The soundness and logic of the vendor's underlying business proposition.
Vertical/Industry Strategy: The vendor's strategy to direct resources, skills and offerings to meet the specific needs of individual market segments, including verticals.
Innovation: Direct, related, complementary and synergistic layouts of resources, expertise or capital for investment, consolidation, defensive or pre-emptive purposes.
Geographic Strategy: The vendor's strategy to direct resources, skills and offerings to meet the specific needs of geographies outside the "home" or native geography, either directly or through partners, channels and subsidiaries as appropriate for that geography and market.
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