The New Unified Communications Sector

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    It’s easy to feel a bit sorry for enterprise videoconferencing vendors: While their business is down, the popularity of what they offer is up. It would be natural for them to think that life is a bit unfair.

    The news that they are struggling was the message of an IDC report released last week. The press release is peppered with minus signs. Here is how it starts:

    The International Data Corporation (IDCWorldwide Enterprise Videoconferencing and Telepresence Equipment QView again showed declining results for the first quarter of 2014 (1Q14), with overall videoconferencing equipment revenue decreasing -20.0% quarter over quarter and -15.9% year over year. Total worldwide enterprise video equipment market revenue in 1Q14 reached $473.5 million. The total number of video units sold in 1Q14 was also down -13.3% quarter over quarter and 6.2% year over year.

    Not a happy picture for these folks. The problem is pretty simple: Unified communications, video conferencing and related disciplines are picture-perfect fits for the cloud. This means that organizations must buy far less equipment than in the past to enjoy these services. What formerly was bought by each organization and housed at their premise now sits in the cloud and can be used across multiple customer locales.

    This transition is inevitable. Longtime sector observer Blair Pleasant uses a post at No Jitter to describe the trends she has seen during the past year. Two of the things she points to are a sharper focus on user experience and simplicity of use. These go hand in hand with the growth of cloud-based third-party experts. In short, the organization that will use the tools can focus on the features and worry far less about the technology. Pleasant points out that the sales focus is changing:

    There’s been an increased focus on use cases and the user experience. In the past, vendors concentrated on technical issues when discussing their UC solutions, including “feeds and speeds,” and all of the compelling features and capabilities that UC provides. The primary buyer was the IT department and possibly the CIO.

    Of course, the geeks at the end-user organizations still will be involved. They must ensure that the services being retained from the cloud vendor are up to snuff. But their overall role will be reduced. The main pitch will be to the people who actually use the services.

    Imago Group’s Wayne Mason makes the case for video conferencing as a service (VCaaS) at Tech Radar. The case has three points, two of which are attributes of both older facilities-based and cloud approaches. The third element, however, is where the difference between cloud and premise gear is clear. The coming of VCaaS, he says, has removed the cost and complexity obstacles:

    By going down this route, businesses have a viable option to take the plunge and add business quality video into their organisation without the infrastructure upheaval, maintenance worries and cost outlay.

    In the long term, the vendors will adapt to the new landscape. The good news for them is that what they offer is still popular, and indeed seems to be growing more so. The only challenge is that the version of it that is generating the most interest is not the one that was in their game plan.

    Carl Weinschenk
    Carl Weinschenk
    Carl Weinschenk Carl Weinschenk Carl Weinschenk is a long-time IT and telecom journalist. His coverage areas include the IoT, artificial intelligence, artificial intelligence, drones, 3D printing LTE and 5G, SDN, NFV, net neutrality, municipal broadband, unified communications and business continuity/disaster recovery. Weinschenk has written about wireless and phone companies, cable operators and their vendor ecosystems. He also has written about alternative energy and runs a website, The Daily Music Break, as a hobby.

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