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Web conferencing - allowing people to hold real-time synchronous meetings and conferences over the web - continues to grow at a healthy pace, fueled by the rising need for real-time user collaboration, a recent Frost & Sullivan analysis of the global web conferencing market states. Total market revenues reached $1.50 billion in 2010, growing at 10.8 percent. However, revenue growth is slowing down due to increased market maturity and the impact of declining prices.
While the overall web conferencing market is being rapidly adopted in all regions, growth in Asia Pacific at 18.5 percent far exceeded the annual growth in other regions, in 2010. Growth in North America and Latin America at 9.2 percent and Europe Middle East and Africa at 13.2 percent has been adversely impacted due to pricing pressures as well as a fragile macroeconomic environment.
Collaborative technologies, video become “must haves”
Fundamental shifts in the nature of business and changing DNA of today’s workforce are making collaboration technologies a “must have”. Vendors are getting ready for the post-PC era where it is thought that users in the future will increasingly rely on a single, connected, mobile device for all of their communication needs. Meanwhile, private clouds, hybrid solutions, and managed services are emerging to shake up the traditional business models.
On-premise market on the rise
The on-premise web conferencing market contributed 19.1 percent of total revenues and showed strong momentum in 2010 registering a revenue growth of 11 percent. The market is in a flux right now, divided between conferencing solutions as well as broader Unified Communications (UC) offerings that integrate robust conferencing functionality. The push toward UC is expected to lead to stronger growth for on-premise web conferencing.
Initial deployments of UC are centered around on-premise solutions. Cloud based UC services are still evolving and do not offer the robust capabilities that their server-based counterparts provide. The need for customization and deeper integration are other reasons for adoption of on-premise UC. All of this is encouraging growth in on-premise UC and web conferencing.
Meanwhile, hosted services or Software as a Service (SaaS) remains the dominant model contributing 80.9 percent of total web conferencing revenues.
Small businesses next big frontier
Revenues for web conferencing are expected to reach $3.05 billion in 2015, supporting a widening user base and a projected revenue growth of 15.3 percent. The Asia Pacific market is growing from a smaller base and remains under penetrated and presents strong opportunities over the next several years.
According to Frost & Sullivan, small and medium-sized businesses (SMBs) are the next big frontier for web conferencing vendors, with cloud-based solutions winning big among SMBs. SMB contribution in the hosted web conferencing services market is projected to grow from 48 percent of revenues in 2010 to 56 percent in 2015.
Source: Frost & Sullivan analysis