Taiwanese IP phone shipment volume for the enterprise market will hit about 850,000 units and one million units in the third and fourth quarter of 2005 respectively, marking roughly 20% sequential growth in each quarter, according to Market Intelligence Center (MIC), an ICT industry research institute based in Taipei. Enterprise IP Gateway shipment volume is forecasted to amount to approximately 115,000 and 145,000 in the third and fourth quarter, sequential growth of about 20% and 25% respectively.

"The global economy is expected to improve in the second half of 2005. Demand for VoIP equipment will also grow in Western Europe and Asia, meaning that besides the established major brands such as Cisco and Nortel, companies such as Siemens and Samsung will also turn to Taiwanese makers for their orders", said Welber Chang, Senior Industry Analyst with MIC.

Enterprise IP phone shipment volume is on the rise again after experiencing a large sequential fall of 24.6% in the first quarter. In the second quarter shipment volume reached approximately 700,000 units, sequential growth of 8.3% and year-on-year growth of 23.8%. This revival in shipment volume was caused by rebounding demand in the three main markets, including North America, Western Europe and Japan.

Major brands operating in these regions therefore increased their orders with Taiwanese makers. Enterprise IP Gateway shipment value has seen uninterrupted, steady growth since the beginning of 2004, with quarterly sequential growth figures hovering around 20% ever since the fourth quarter of 2004.

Taiwanese residential VoIP equipment shipment volume is also expected to experience considerable growth in the third and fourth quarter, with sequential increases of roughly 30% and 24% respectively, reaching about 4.5 million and 5.6 million units.

Chang explained that second half growth of this shipment volume will be driven by three main factors. Firstly, Western European telecoms will continue to aggressively roll out VoIP services, pushing demand for IADs (Integrated Access Device) and leading to increased orders for Taiwanese makers, including Askey, Arcadyan and Tecom, from major brands such as Siemens, Thomson and Sagem.

Secondly, North American television companies such as Cablevision and Time Warner will continue to introduce triple play services, which will lead to growing sales of VoIP cable modems by major brands such as Arris and Motorola, who in turn will look to Taiwanese makers including AsusTek and Askey for their orders. The third driving force is the growing demand for VoIP routers as the number of VoIP users is growing strongly in Northern America and Northern Europe.

Residential VoIP equipment shipment volume experienced a similar sequential dip as enterprise IP phone shipment volume in the first quarter of 2005, which was due to high

inventory levels at that moment in time. In the second quarter shipment volume went up again, reaching about 3.5 million units, 33.4% sequential growth and 230.1% year-on-year growth. This renewed sequential growth was stimulated by increasing demand for IADs from Europe, by the aforementioned fact that regular cable modems were starting to be replaced by VoIP cable modems, especially in North America where large television companies are pushing VoIP services, and by a surging demand for wireless VoIP products.