The Rise and Rise of Video Conferencing
A recent study of the video conferencing market pegs its global value at USD 7.85 billion in 2023;this is a CAGR of 8.5% from a valuation of USD 3.69 billion in 2014. More importantly, video conferencing is fast moving from being a standalone collaboration tool to becoming an integrated part of ‘Unified Communications’ solutions, with strong web and mobile capabilities. We analyze the drivers of this growth, and look at some key trends and challenges.
The days are almost past when participating in a video conference always meant intense planning for days, enlisting multiple tech support guys to manage and operate the intimidating systems, and finally walking in to the awe-inspiring, extremely expensive (and thus inaccessible for most) video conferencing board rooms. Greater number of millennials and a growing number of telecommuters are demanding the democratization of video conferencing; on the other hand, reducing prices of equipment, and the evolution of mobile and cloud based technologies is finally making it possible for organizations to make video conferencing an enterprise collaboration tool in the truest sense.
There are two key trends that are changing the video conferencing space at an aggressive pace: the convergence and ‘cloudification’ of web and video conferencing, and the growth of the integrated UC offerings and the Unified Communications as a Service (UCaaS) market.
Video and web conferencing solutions are no longer being viewed as separate requirements by enterprises; one in-room video conference may connect with another group sitting in a VC room, as well as individuals sitting at their desktops, or out in the field connecting in via their mobile phones or tablets. The same conference may also involve sharing content as well as application screens. Cloud-based, low cost offerings and the evolution of the WebRTC technology (that enables voice and video calling directly from web browsers) are the key driving forces behind this convergence. Driven to innovate by this disruption, traditional video conferencing providers have upgraded their solutions to provide web conferencing features, as well as screen and application sharing and VoIP. On the other hand, standalone web conferencing solutions like Cisco’s WebEx now support video on their desktop and mobile conferencing.Gartner’s 2015 Magic Quadrant for Group Video Systems names Cisco as an established leader in the video systems space for offerings spanning the range from premium immersive video systems to cloud-based solutions with high interoperability capabilities.
Another trend affecting the video conferencing space is that enterprises are moving away from investing in stand-alone collaboration tools, towards a holistic ‘unified communications’ (UC) portfolio that includes enterprise messaging and presence, web conferences, telephony and video conferencing. With cloud-enablement, the UCaaS model, where the entire collaboration suite is delivered by a third party service provider over the cloud is fast gaining ground, especially amongst the SMB segment. Delivering significant capex and opex benefits, the UCaaS market is expected to grow from a 2013 valuation of USD 5.68 billion to USD 37.85 billion in 2022 – a staggering CAGR of 23.4%. Another report on the UCaaS market assesses that,“Videoconferencing SaaS is the smallest product segment within the market but is also the highest growth, with revenues growing by almost 50% per year.”
Experts thus foresee organizations interested in solutions that bundle audio, video and web conferencing capabilities with integrated collaboration business suites (for example, Microsoft’s UCaaS offerings bundled with Office 365).
The Opportunity for Resellers
Amidst all these fast pace changes, organizations are still finding their way around video conferencing solutions. According to a recent survey by Western Unified Communications Services, a majority of the IT managers cite video conferencing platforms as being the most difficult to maintain. Another major challenge is upscaling from in-room systems to fully integrated UC solutions to achieve greater mobility, lower costs, and most importantly, organic collaboration capabilities within business processes.
Until the collaboration products landscape is simplified further by the market and technology forces, SIs and resellers have a critical role to play in helping enterprises address these complexities. A deep understanding of the solutions, and their relative merits and demerits in various business contexts will be key for resellers to differentiate themselves in this market. For example, some of the assessments to be made for such decision making are:
- Understanding business-specific use cases for which video conferencing is needed and the critical features for the same ; for example, the healthcare industry is a leading adopter of video conferencing to facilitate its telemedicine services, and prefers on-premise deployments to ensure 100% data integrity
- Understanding the exact environments in which employees will be using video conferencing to arrive at infrastructure requirements
- Identifying the multiple endpoints–desktop-based, mobile-based, standards-based–with which interoperability is desired
- Assessing the percentage of external video conference calls to identify the firewall traversal strategy
- Identifying key applications, for example, CRM, analytics, calendar and scheduling, with which integration is required to assess the API requirements
- Understanding the scale of the implementation to judge the extent of vendor support needed for monitoring and management
According to the Western Unified Communications Services survey, for 53% of the respondents, increase in productivity was the primary reason for investing in collaboration. However, most companies still struggle to measure the benefits of video conferencing, or to prepare a convincing enough business case for the same. Resellers need to address this gap in the market, and help video conferencing reach its full potential by helping clients define their requirements, choose the most suitable solution and deploy it to maximum advantage.