Erstwhile comms industry staple Panasonic is to pull out of the business telecoms market and plans to discontinue its PBXs, SIP telephone systems and Scanner categories, including parts, within two years. The company says it is responding to a sharp decline in the market and rapid shift to cloud-based solutions.
Panasonic also identified a technological mismatch between factory and future market needs and trends, and conceded that it is lagging behind rivals' R&D activities.
Panasonic has experienced a constant financial deficit due to these reasons.
It said in a statement, 'the shift to new types of demand (hosted phones systems) significantly accelerated by Covid-19 makes the future of the Panasonic business untenable and unpredictable'.
The vendor also noted that the shift to hosted comms has been 'significantly accelerated by Covid-19'.
Matthew Worboys, Director - Business Development Channel, Gamma, commented: "This is a sad day for the comms industry. Panasonic was at the centre of the SME market but never a trailblazer on features, yet it had a robust offering.
"It's a constant challenge for vendors to innovate and remain relevant. Gamma's investment in its own software development house shows just that."
Trust Distribution MD Vince Leahy commented: "Many of our channel partners entered the telecoms industry selling Panasonic PBXs, building successful businesses throughout the UK and beyond.
"Panasonic was the UK’s leading vendor in the SMB space for many years and as a result there is a massive installed base of customers that need ongoing support today and into the future.
"Trust will be working closely with Panasonic and our partners to ensure they get as much support as possible over the transitional period to help minimise any disruption to their businesses.
"We feel sad for the Panasonic staff, many whom we have worked with for a long time."
Editor's comment
It seems that Covid-19 spurred Panasonic to make an early decision on what was an already inevitable outcome. So why didn't we see it coming? Strength of brand, a strong history in the sector and a great product counts for nothing in a changing market. And customer loyalty cannot be relied on as a life jacket in turbulent seas - meaning that traditional resellers need to interpret Panasonic's pull-out as a signpost of the true market direction, the real speed of travel, and what the consequences of not taking appropriate action now will look like.
Which vendor might be next?
Why endure uncertainty when the market direction has never been more set in stone for all to see?
On the upside the pull-out gives affected resellers an opportunity to build certainty into their business, and have a new and required conversation with customers, an opportunity to get further under the customers' skin and propose an alternative cloud solution that includes wider elements such as next generation connectivity and a long-term strategic answer to home working enablement, for example. Thereby ring fencing their base for years to come. Again, this is an inevitable outcome - so why wait until it's too late?