March 23rd, 2005
The coming price war in the VoIP phone market
In terms of enterprise VoIP deployment,Ithink much of the battle will be fought over the "form factor" - which type of device VoIP subscribers will use to access their services.
Specialized VoIP phones offer call configuration, control, management and data import capabilities that traditional phones tied in to the VoIP network via an Analog Terminal Adapter and a router cannot. Yet such phones are pricey.
According to a Reuters story, VoIP phone prices now average around $250 per set. For some budget-conscious enterprises, that could be a barrier to use.
But perhaps not for long. The same article foresees that aggressive price promotions from well-capitalized VoIP phone manufacturers such as Cisco Systems could push prices even lower. How low is a subject of contention.
Here’s my take on what’s going to happen. Cisco and others, such as Avaya, will undertake aggressive price promotions with systems integrators and retailers. A per-unit price of $150 in the next several months isn’t unlikely. At the same time, you’ll see the generics get even lower. That’s the way these price wars usually play out in technology deployment.
Depending on the cost and efficiencies achievable in the VoIP semiconductor channel, I predict that by 4Q of this year, we are going to see widespread pricing at or below $100 for the same feature sets that are list priced at $250 now.
What’s your prediction on VoIP phone prices? Post a TalkBack.
Russell Shaw is an enterprise computing journalist, analyst and author based in Portland, Oregon. See his full profile and disclosure of his industry affiliations.
