The reasons behind the drop in the telephony market are made clear in a statement tucked away in Infonetics’ report, which says:

“In the first quarter of 2013, enterprise PBX spending dropped to its lowest point since mid-2009. The big squeeze is coming from hyper-competitive price pressure all over, with average revenue per line down across the board. But conservative spending by businesses is exacerbating the problem in some regions, while demand is actually flat-to-up in North America and Asia, reflecting uneven economic recoveries.”

What’s more, the report goes on to make a point that illuminates a big problem with its doom-and-gloom outlook on the global telephony market:

“Meanwhile, demand for unified communications is increasing in all regions as businesses seek tools to help them boost employee productivity and flexibility.”

The biggest mistake Infonetics made in their recent report announcing the death of the telephony market lies in the fact Infonetics split up the telephony market and the Unified Communications market. In essence the company’s report stated that telephony technology is one thing, and Unified Communications technology is another thing, and that just isn’t true. Dedicated telephony technology is a part of UC, not some separate market that needs to be taken exclusively on its own terms.

This oversight becomes especially clear when you read deeper into Infonetics’ report and realize that the UC market has actually grown 21% year-over-year in the first quarter of 2013. So while the solo telephony market may have dipped, the larger communications market grew dramatically in the exact same time period.

In fact, dedicated telephony solutions only found themselves dropping in a few areas, primarily in Europe, which is in a conservative spending phase across the board. These same dedicated telephony services were either growing or holding steady in both North America and Asia, indicating that the drop in the telephony market is primarily localized. By contrast growth in the UC market is up in all regions, worldwide.

Which means telephony technology isn’t in any sort of slump at all- it’s healthy and growing at a high rate. The telephony technology market simply doesn’t look the same as it used to, and trying to evaluate in accordance with outdate definitions is misguided, at best. The telephony market and the UC markets need to be seen as one in the same, and telephony’s growth needs to be considered in relationship to the larger field of communications technology of which it’s become a part.

So, is telephony dying? Nope, not at all. Dedicated telephony technology that stands exclusively on its own may be phasing out, but telephony technology as part of a greater communications landscape is alive, and robust, and growing at a phenomenal rate.

How are Telephony Solutions and UC Solutions Divided?

It’s worth pointing at as a side note that what divides telephony technology and unified communications technology isn’t necessarily clear within these reports, and it can be difficult to quantify when telephony technology becomes part of the UC market.

Thinking along these lines, it’s wise to note that it’s becoming increasingly difficult to find telephony solutions that can’t be grouped in as UC solutions. More and more telephony solutions are including expanded and ever-connected functionality, which means the dip in the telephony market may represent nothing except more and more companies and (primarily dedicated) telephony solutions finding themselves lumped in as UC technologies because they offer video chat, or integration with a softphone, or connections with a decentralized network.

Before we can start talking seriously about the potential death of the telephony market we at least need to start being transparent about the terms we’re using, the lines we’re drawing, and when a technology shifts from being “telephony” into being “UC,” or we simply need to uniformly consider the whole telephony marketplace as part of the UC market.