Global PBX (News - Alert)/KTS phone system revenue grew 5.5 percent sequentially in 3Q11 to $2.15 billion, reversing the sequential declines from the first two quarters of the year, according to market analyst firm Infonetics Research.

Interestingly, PBX market is up 6.6 percent compared to same quarter last year. VoIP vendor Avaya is the biggest player in this sector, and Cisco is close behind increasing its revenue in the third quarter.

"For the fourth straight quarter, Avaya (News - Alert) leads the highly competitive PBX market, with about a quarter of the world's PBX revenue in 3Q11. Avaya is holding onto its revenue lead with steady shipments and healthy ASPs due to continued increases in IP endpoint sales,” notes Diane Myers, directing analyst for VoIP and IMS at Infonetics (News - Alert) Research.

Cisco's overall ASPs declined in the quarter due to special promotional packages but pricing helped spur activity.

“From the year-ago third quarter (3Q10), the global PBX market is up 6.6%, continuing the slow and steady recovery recorded throughout 2011 on a year-over-year basis,” says the report.

In this quarter, unified communications revenue increased 15.2 percent sequentially, while VoIP gateways saw a small decline of 1.5 percent. Notably, the computer software giant Microsoft (News - Alert) is growing its presence in the UC space with 25 percent year-over-year Lync revenue growth.

The report notes that businesses have continued to migrate to IP-based phone systems, evinced by the revenue split in 3Q11: Hybrid IP PBXs make up nearly 2/3 of global revenue; pure IP PBXs continue to grow as a proportion of the market, now making up nearly 1/3 and growing, and TDM PBXs continue to decline overall.

 EMEA was the standout region for the quarter, reversing a string of losses with 11.0 percent sequential growth in PBX revenue; however, Infonetics remains cautious about EMEA due to the current economic situation.

During the course of the period, PBX revenue in Asia Pacific is up 11 percent year-over-year (3Q11 vs. 3Q10).