News Release

Cisco Leads Dynamic Shift to IP Telephony in Enterprise Market

Cisco is now number-4 voice vendor worldwide; only vendor to realize revenue market share gains calendar Q2 2004, according to Synergy Research
Aug 20, 2004

SAN JOSE, Calif., August 20, 2004 - Cisco Systems® Inc. is capturing enterprise voice revenue market share as the company continues to ship more Internet Protocol (IP) telephones than its competitors, according to a report issued by Synergy Research Group this week.

Cisco® maintained its lead in the Enterprise Voice over IP (VoIP) Revenue category with 31.8 percent revenue share in the second calendar quarter 2004, according to Synergy. The report also stated that Cisco passed Alcatel to become the world's fourth-largest enterprise voice vendor as measured by total revenue of traditional and IP voice sales. Cisco maintained its leadership in IP phone shipments, with 41.6 percent of all IP phones shipped by revenue, and passed Avaya in the number of total enterprise voice port shipments.

Cisco sold more than 437,000 IP phones to customers in the second calendar quarter 2004, more than any other vendor and more than any other quarter since the company entered the voice market, according to Synergy. IP phones are the best and one of the few hard-data measures of the actual deployment of IP telephony.

"Cisco is leading a truly dynamic shift in the enterprise telephony market," said Jeremy Duke, president of Synergy Research Group. "Over the past five years, Cisco has demonstrated rapid growth in its IP phone business, establishing itself as the number-four global vendor in the enterprise voice market today, including both traditional and IP-based PBXs. This is a remarkable accomplishment for a company that entered this well entrenched market in 1999 and it positions Cisco as the fastest-growing provider of corporate voice systems."

Analysis of Synergy's report also indicates that Cisco has risen to the number-three position in the Enterprise Voice Revenue category, passing Avaya, with the exclusion of legacy-based key systems in that category. Cisco does not sell key systems, which are small private branch exchange systems for small or branch offices.

"This phenomenal growth has firmly positioned Cisco as the world's fastest- growing communications company," said Rick Moran, vice president of the Product Technology Marketing Organization for IP Communications at Cisco. "Two-and-a-half years ago, Cisco was a lone voice talking about IP-based communications. Today, every incumbent vendor in business communications has announced that all future products will be based on IP."

Cisco Momentum Facts and Figures

Cisco is the leader in IP telephony/VoIP with delivery of about 3.5 million Cisco IP phones to customers. It took 30 months for Cisco to sell its first million IP phones; 12 months to sell the second million and eight months to reach 3 million sold to customers. The company is selling two to five times as many IP phones as any other competitor and is displacing more than 8,000 traditional, circuit-based telephones every business day. More than 60 percent of Fortune 500 companies have deployed Cisco IP Communications systems and Cisco has more than 16,500 IP Communications customers worldwide.

About Cisco IP Communications

Cisco IP Communications is a comprehensive system of enterprise-class solutions including IP telephony, unified communications, rich-media IP audio and videoconferencing, IP video broadcasting and customer contact solutions that take advantage of customers' existing Cisco IP infrastructure to deliver new converged applications. More information about Cisco IP Communications is available at: