Unified comms market to be worth US$16.6bn by 2014

14 Jan 2011

The EMEA unified communications (UC) market was worth just over US$8bn last year but will grow to US$16.6bn by 2014, according to IDC.

“IDC predicts moderate year-over-year growth in the next five years and believes that the impact of the credit crunch across the EMEA region will continue to make enterprises more cautious when deciding whether or not to invest in new IT equipment,” said Isabel Montero, senior research analyst, unified communications and collaboration, IDC EMEA.

“Budgets in this region will continue to be more closely monitored, restricted or delayed until recovery in the economy is more notable,” Montero said.

UC hosted services will be on the rise and will become more dominant late in the forecast period.

This trend will be more notable in the small and mid-size business community. Businesses looking to outsource UC solutions as a service instead of managing solutions in-house will primarily do so to reduce the cost of network management and maintenance. Therefore, the demand for UC solutions sold as hosted or cloud-based services will be on the increase throughout the forecast period.

Network complexity will drive demand for UC

The current economic situation, and the increased complexity of a company’s network infrastructure, will drive businesses to have their converged networks and related services managed for them. Managed services of CPE equipment will be driven by a company’s need for external expertise and move from a capex-based model to an opex-based model.

IDC said it expects to see more mergers and acquisitions over the next five years, driven by fierce competition among legacy vendors to improve interoperability and compatibility and to develop UC solutions that meet the criteria of the new open-source ecosystem.

Vendors are experiencing challenges in articulating the business case to their customers and prospects that extends beyond the soft metrics of increased employee productivity.

Up until now, most sales efforts have been focused on selling to the IT department, but now the integration of voice and data with business-critical applications requires line-of-business managers to have seats at the negotiating table.

“These additional members require greater effort from the sales team to pitch and understand the value of UC, often by focusing on vertical market expertise, which is why we believe that vendors need to work more closely with their channel partners to market and provide them with the necessary tools and training around UC solutions,” said Montero.

John Kennedy is a journalist who served as editor of Silicon Republic for 17 years