I recall when some of the first videoconferencing systems were installed in multinational enterprises across America, more than two decades ago. Since that time, there have been many new developments in video communication-related technologies and associated services.
The introduction of Telepresence was a significant advancement. However, the arrival of software app and web-based services -- such as Microsoft Skype and Google Hangouts -- have raised expectations for online collaboration ease-of-use and transformed how video meetings are conducted across the public Internet.
In the first quarter of 2016 (Q1 2016), video conferencing revenue declined 22 percent quarter-over-quarter to $701 million due to lower seasonal demand, according the the latest worldwide market study by IHS Technology.
Video Communication Market Development
Videoconferencing revenue is also trending down slightly on a year-over-year basis, primarily due to decreases in infrastructure sales. Demand for video conferencing endpoints is still growing, but the shift to cloud services is displacing a significant amount of infrastructure equipment revenue.
The backbone of the video conferencing market, the dedicated system segment continues to decline, falling 6 percent in the first quarter of 2016 (Q1 2016) from the year-ago quarter (Q1 2015). Although endpoint demand remains steady, infrastructure sales are plunging as alternative approaches such as embedded, virtual and cloud-based multipoint control units (MCUs) gain acceptance.
Two highlights in Q1 2016 were PBX-based video and immersive telepresence.
PBX-based video has proven popular because it offers organizations a cost-effective way to enjoy multimedia communication using infrastructure they already have. PBX-based video took a breather in 2015 due to a videophone portfolio refresh at Cisco, but as of Q1 2016 the segment is returning to year-over-year growth—primarily due to a pickup in software demand.
Immersive telepresence grew for the first time in 2015 since 2011, and the recovery is extending into 2016 with Q1 revenue increasing 19 percent year-over-year.
On a regional basis, North America was the bright spot in Q1 2016—up 12 percent year-over-year—while all other major geographic regions declined.
According to the IHS assessment, a flat outlook is forecast for the video conferencing market, with revenue of $3.2 billion by 2020 and a five-year (2015–2020) compound annual growth rate (CAGR) of zero percent.
The introduction of Telepresence was a significant advancement. However, the arrival of software app and web-based services -- such as Microsoft Skype and Google Hangouts -- have raised expectations for online collaboration ease-of-use and transformed how video meetings are conducted across the public Internet.
In the first quarter of 2016 (Q1 2016), video conferencing revenue declined 22 percent quarter-over-quarter to $701 million due to lower seasonal demand, according the the latest worldwide market study by IHS Technology.
Video Communication Market Development
Videoconferencing revenue is also trending down slightly on a year-over-year basis, primarily due to decreases in infrastructure sales. Demand for video conferencing endpoints is still growing, but the shift to cloud services is displacing a significant amount of infrastructure equipment revenue.
The backbone of the video conferencing market, the dedicated system segment continues to decline, falling 6 percent in the first quarter of 2016 (Q1 2016) from the year-ago quarter (Q1 2015). Although endpoint demand remains steady, infrastructure sales are plunging as alternative approaches such as embedded, virtual and cloud-based multipoint control units (MCUs) gain acceptance.
Two highlights in Q1 2016 were PBX-based video and immersive telepresence.
PBX-based video has proven popular because it offers organizations a cost-effective way to enjoy multimedia communication using infrastructure they already have. PBX-based video took a breather in 2015 due to a videophone portfolio refresh at Cisco, but as of Q1 2016 the segment is returning to year-over-year growth—primarily due to a pickup in software demand.
Immersive telepresence grew for the first time in 2015 since 2011, and the recovery is extending into 2016 with Q1 revenue increasing 19 percent year-over-year.
On a regional basis, North America was the bright spot in Q1 2016—up 12 percent year-over-year—while all other major geographic regions declined.
According to the IHS assessment, a flat outlook is forecast for the video conferencing market, with revenue of $3.2 billion by 2020 and a five-year (2015–2020) compound annual growth rate (CAGR) of zero percent.