Strong demand for converged voice and data networking equipment saw the global IP phone market post strong results in the second quarter of 2006, growing 42 per cent year-over-year to reach over $500m.

According to the latest research from Dell'Oro Group, Cisco enjoyed strong sales of over one million IP telephones in the quarter.

This not only widened Cisco's lead in the IP PBX market, but enabled the networking giant to climb two places in the total PBX market.

"IP telephony is currently driving PBX market sales as enterprises increasingly adopt VoIP and retire their traditional PBX systems," said Steve Raab, director of IP telephony research at Dell'Oro Group.

"As a major proponent of IP telephony, Cisco is gaining PBX market share in all major geographic markets around the world and challenging incumbent vendors Avaya and Nortel for market leadership."