Right Place : Right Time
OSS Telephony
Adoption Trends
Economic Upheaval
• Worldwide markets still reeling from global
economic crisis
1
• IT markets predicted to decline in 2009
• Enterprise spending down 30% yoy
• Carrier spending down 20% yoy
• Public sector spending down 15% yoy
1. Thomas Wiesel
Creative Innovation – Customer Satisfaction – Continual Quality Improvement
Economic Upheaval
• Buyers currently undergoing a ‘reset-tion’
• Once spending begins to return, buyer
behavior will change
•
•
•
•
Buyers much more cautious
Buyers looking for value
ROI terms shortened
Lower cost alternatives get more airplay
Creative Innovation – Customer Satisfaction – Continual Quality Improvement
Economic Upheaval
• Markets contract as a result of lower cost
alternatives gaining share
• Open Source-based alternatives gaining
momentum and acceptance as a result of
the economic turmoil and changes in
buyer behavior
Creative Innovation – Customer Satisfaction – Continual Quality Improvement
Open Source Software
Adoption Trends
Function/Application
Open Source
Solution
Operating System
Linux
Web Server
Apache
Browser
Firefox
Telephony/Communications
Asterisk
Database
MySQL
Customer Relationship Management
SugarCRM
Backup
Zmanda
Productivity Suite
Open Office
Collaboration Suite
Zimbra
Creative Innovation – Customer Satisfaction – Continual Quality Improvement
Open Source Trends
Source: Savatar
Creative Innovation – Customer Satisfaction – Continual Quality Improvement
The Market for Open Source
• Stand Alone Open Source Market will reach
$5.8B by 2010/2011 (26% CAGR)1
• Tens of millions of new downloads of some
version of open source software in 2009
1. IDC
Creative Innovation – Customer Satisfaction – Continual Quality Improvement
Voice over IP
Adoption Trends
VoIP – an upheaval survivor
• VoIP as a technology category will fair well
in comparison to other technologies
• VoIP enables …
• Communications expenditure cost reductions
• Non-centralized work force structure
• Lower commute costs
• Lower facilities cost
• Mobile work force productivity
Creative Innovation – Customer Satisfaction – Continual Quality Improvement
Total IP PBX Market Forecast
IP PBX Market Forecast (Global), 2006-1013
60
10
Units (Millions)
50
8
7
40
6
5
30
4
20
3
2
10
1
0
0
2006
2007
2008
2009
2010
2011
2012
2013
Year
Units (Millions)
Revenue (US$ Billions)
Source: Frost and Sullivan 2008
Revenue (US$ Billions)
9
IP Telephony Adoption
• IP PBX market will reach $7.9B by 2010 (21%
CAGR)2
• 2010 IP PBX penetration will still be less than 50%
• This year, IP line shipments will pass TDM
shipments3
• Growth in IP Telephony (IPT) systems dominates
PBX market segment3
• 19% CAGR
2. Gartner Group
3. TEQConsult Group
Open Source VoIP
Adoption Trends
Open Source IP PBX Downloads
• 2008 total worldwide downloads of Open
Source PBX software
– Total - 1,750,000
– Asterisk - 1,540,000
– Non-Asterisk - 210,000
• 2008 total North America downloads of Open
Source PBX software
– 490,000
– North America is 28 percent of total downloads
Source: Eastern Management Group
Creative Innovation – Customer Satisfaction – Continual Quality Improvement
Open Source IP PBX Metrics
• Total 2008 North American Open Source
PBX Business Telephone Systems
– 86,872
• Total 2008 North American Open Source
Business Telephone System end points
– 2,854,749
• Average 2008 Open Source PBX Business
Telephone System end points:
– 32.8 end points
Source: Eastern Management Group
Creative Innovation – Customer Satisfaction – Continual Quality Improvement
2008 Total North America
Business Telephone System
Market
Traditional PBX and Key System
13,029,148
Lines
Open Source lines
2,854,749
Total Lines
15,883,897
Open Source as a % of Total
18%
Source: Eastern Management Group
Creative Innovation – Customer Satisfaction – Continual Quality Improvement
2008 New PBX End Points
2008 Largest Suppliers
End Points
Open Source
2,854,749
Nortel
2,632,145
Cisco
1,990,255
Avaya
1,752,885
Mitel
1,228,887
NEC
1,222,578
Source: Eastern Management Group
Creative Innovation – Customer Satisfaction – Continual Quality Improvement
2008 Business Communications
Systems Market Share
Source: Eastern Management Group
Creative Innovation – Customer Satisfaction – Continual Quality Improvement
Asterisk Share of OSS IP PBX Market
Based on most recent implementation
Source: Eastern Management Group
Creative Innovation – Customer Satisfaction – Continual Quality Improvement
2008 New PBX End Points
2008 Largest Suppliers
End Points
Nortel
2,632,145
Asterisk
2,512,179
Cisco
1,990,255
Avaya
1,752,885
Mitel
1,228,887
NEC
1,222,578
Source: Eastern Management Group
Creative Innovation – Customer Satisfaction – Continual Quality Improvement
OSS IP PBX Vendor Market Share
Open Source Manufacturers
Percent
3 Com
2%
Aastra
2%
Critical Links
2%
Digium
68%
Fonality
21%
Intuitive Voice Technology
2%
Nortel (including Pingtel)
3%
SimiComm
<1%
Source: Eastern Management Group
Creative Innovation – Customer Satisfaction – Continual Quality Improvement
How does Open
Source Telephony
get adopted by
end-users?
Creative Innovation – Customer Satisfaction – Continual Quality Improvement
How end users benefit from OSS
Buy a complete
OSS-based
product
Build you own –
or have an
integrator build a
solution for you
• IP PBX (based on OSS)
• Media Gateways (based on OSS)
• Soft Switch (based on OSS)
• OSS Software
• Commercial Software
• Hardware Platforms
• Training
• Services
• 3rd Party Add-ons
Tool Kit
Components
Market Needs vs.
End User Technical Skill
Packaged
OSS Based
Solutions
Custom
Engineered
OSS Solution
Lo ….…. End-User Technical Competency ….… Hi
Market Needs vs. Size of Business
Large Enterprise
Custom Application Components
Medium-sized business
Blend of both
Small Business
Complete OSS-based Products
The OSS IP Telephony ‘Long Tail’
Turn-key OSS-based products
Demand /
Revenue
STD
IP PBX
Custom-built OSS-based solutions
Creative Innovation – Customer Satisfaction – Continual Quality Improvement
Digium Product Relationships
Turn-Key Products
(Switchvox 4.0)
Turn Key Products
(Switchvox 5.0)
Commercial Edition
Version C.x
Commercial Edition
Version D.x
Testing and
Qualification
Testing and
Qualification
OSS Asterisk V1.4
OSS Asterisk V1.6
Asterisk Development
OSS Enables Customizable
Solutions
• The holy grail for communications solutions
• Tightly integrate communications with
existing business processes
– Reduce cost
– Improve productivity
• Enabled through
– Software-based communications engines
– APIs and/or custom development
Creative Innovation – Customer Satisfaction – Continual Quality Improvement
Summary
• Next 12-24 months will be challenging
• VoIP is an investment that pays a tangible
ROI - today
• Open Source solutions are gaining popularity
– Lower cost
– No vendor lock-in
– Easily customizable
• OSS + VoIP = Right Place, Right Time
Creative Innovation – Customer Satisfaction – Continual Quality Improvement
Questions & Discussion
Digium - The Answer is Open
Creative Innovation – Customer Satisfaction – Continual Quality Improvement