The global unified communications market size was estimated at USD 26.39 billion in 2013. Factors such as increased adoption of Bring Your Own Device (BYOD) and rising penetration of mobile devices have led to increased demand. In addition, its emergence as a Service (UCaaS) is expected to have significant growth potential. UCaaS is a delivery model that involves outsourcing of communications and collaboration of applications and services to third-party providers, delivered over an IP network. UCaaS technologies include video conferencing, telephony, enterprise messaging and presence technology, and online meetings. It provides high levels of availability (HA) as well as scalability and flexibility for core business tasks.
These systems integrate multiple communication applications into a single module. This includes bundling of real-time communication services such as voice and IP telephony, data sharing, instant messaging, call control, and video conferencing with other types of services such as e-mail, voicemail, fax, and SMS. Thus, it helps automate and unify user experience across different devices. It is extensively used for business as well as social purposes. However, high initial investment and lack of interoperability between multiple platforms are expected to pose major challenges to the unified communication industry.
The technology is widely used for implementing the Bring Your Own Device (BYOD) trend. It represents the connection of personal devices including notebooks, tablets, smartphones, and PCs to an organization’s vertical network, which helps employees gain access to the network through their own devices from remote locations. This provides a number of organizational, financial, and operational benefits.
North America unified communications market by product, 2012-2020, (USD Million)
UC system types comprise on-premise and cloud-based or hosted systems. On-premise systems offer customization and better control capabilities and are easy to manage, but need sufficient maintenance and a well-trained staff.
Cloud-based systems offer better flexibility as against on-premise systems, and organizations deploying them can add new functionalities or features as required. Further, these systems provide several benefits to the organizations including better and more streamlined access to company data, reduced infrastructure cost, and are a good fit for geographically distributed organizations.
Enterprises accounted for over 50% of the overall unified communications market in 2013. This can be attributed to the increasing adoption of IT in business processes and for the benefits such as presence, mobility and collaboration provided by such advanced technology. It enables enterprises to have better connected employees and better operational agility, which eventually provides for better customer engagement.
Education, healthcare, and government are some other sectors that foresee substantial growth in the demand. Increasing initiatives taken by the government towards improvement of their processes and efficiencies have made it the fastest growing sector in the industry. Demand in government applications is estimated to grow at a CAGR of over 17.5% from 2014 to 2020.
North America unified communications market accounted for over 35% of the global demand in 2013. The regional market is characterized by the presence of several key players as well as high popularity of BYOD solutions. Europe and Asia Pacific are expected to be the fast growing regions, which can be attributed to the need for effective communications and collaboration along with cost savings.
Large population base and spread of high-speed data networks in regions such as China and India have led to favorable demand for these systems in such regions. Developed infrastructure and wide adoption of such advanced systems in the region has spurred the regional demand. Stringent regulations pertaining to telecom services are expected to be a key barrier, and restrict global service providers from entering Asian countries such Vietnam, India, Indonesia, and China.
Major industry players include Alcatel-Lucent, Cisco Systems Inc., IBM, Microsoft Corp., NEC Corp., Polycom Inc., Unify GmbH, and Verizon Communications. A large number of Fortune 500 companies are using Cisco’s UC solutions, which has resulted in its dominance in the unified communications market share.
Cisco provides a portfolio of solutions that provide consistent end-user experience across multiple devices. Its ability to host various infrastructure services and business-critical collaboration capabilities among different end-use industries enabled it to acquire major market share.