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    Video Conferencing Space Continues Transformation, IDC Says

    By
    Jeff Burt
    -
    August 29, 2014
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      cloud collaboration

      The video conferencing market continues to be a bad-news, good-news situation for vendors, according to analysts with IDC.

      The trend in revenues from video conferencing equipment kept its years-long slide going, with overall revenues falling 9 percent over the same period last year to $482 million, although there was a bump of 1.8 percent over the first quarter, the analysts said in a report Aug. 29. However, the total number of video units sold in the quarter increased 5.5 percent over the second-quarter 2013.

      That said, the continuing decline in equipment revenues is not indicative of a lack of interest in video conferencing technology, they said. Businesses still see a lot of value in the technology in helping reduce costs while increasing productivity. However, the interest is being focused on software- and cloud-based solutions.

      So while the shrinking equipment revenue is the bad news, the good news is that essentially every established vendor in the space, such as Cisco Systems and Polycom, is rapidly building out its own software and cloud offerings to compete with smaller companies like Vidyo and Blue Jeans Network, which have no hardware business to worry about.

      “We continue to see the impact of delayed customer buying decisions, lower-cost systems, more software-centric products, and competitive cloud-based video service offerings on the worldwide enterprise video equipment market,” Rich Costello, senior analyst for enterprise communications infrastructure at IDC, said in a statement. “The mixed video equipment results are also indicative of the ongoing transition from a primarily hardware-based reporting model to one impacted by the interest in and growth of video subscription services. On the bright side for the video equipment vendors, most or all of these vendors now offer, or are ramping-up to offer, cloud-based video alternatives to customers—in addition to their own lower cost, premises-based systems.”

      Petr Jirovsky, research manager for IDC’s Worldwide Networking Trackers, said that while businesses still see video as an important part of their collaboration strategy, “among the challenges customers are currently working through is determining exactly when and how to provision their video deployments as more software-centric and cloud-based service offerings become part of the enterprise video market landscape.”

      Cisco continues to lead the video conferencing equipment space, holding a 38.4 percent market share, even though revenues fell 15.2 percent over the same period last year. Polycom owns 30.3 percent market share, and revenues declined 6.2 percent. Huawei saw its revenues grow 8.6 percent year-over-year, and has 9.1 percent of the market, good for third place, IDC said.

      Jeff Burt
      Jeffrey Burt has been with eWEEK since 2000, covering an array of areas that includes servers, networking, PCs, processors, converged infrastructure, unified communications and the Internet of things.
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