Unified communications promising market in China

MELBOURNE, AUSTRALIA: Although the adoption rate of IP telephony is still low in China, the implementation of unified communications (UC) applications among the companies currently using IP telephony is encouraging.

In a new survey, independent telecoms analyst Ovum found that only 16 percent of the surveyed Chinese companies have already deployed IP telephony. This is the lowest adoption rate across the 12 countries surveyed. However, amongst the companies currently using UC, application is encouraging.

Based on the survey, more than 40 percent of current IP telephony enterprise users are deploying IM and PC soft clients. “For cultural reasons, IM is considered one of the most popular and important communication approaches by enterprises in China. Chinese users prefer typing to talking at work,” said Jane Wang, senior analyst. Softphone is perceived as an affordable alternative to IP desk phones and a way to reduce telephony costs, and has attracted increasing interest from large enterprises.

“Low return on investment and the complexity of updating existing systems have been major barriers for enterprises deploying IP telephony. The migration costs and subsequent maintenance expenses of on-premise solutions are still considered high. The hardware costs are also high,” added Wang, who is based in Beijing.

The average price of IP desk phones in China is approximately $300 and hasn't declined significantly in the past few years. These high costs mean that vendors have to work hard to address customers' concerns and convince enterprises that IP telephony is more than just another voice solution. They need to present successful case studies with clear business gains and reduce the burden involved in migrating to and maintaining the new technology.

Wang suggests that vendors and service providers should reduce the entry costs of IP telephony to attract customers who are likely to subsequently buy new UC applications.