Ovum has published a report that forecasts global spending on business video conferencing will hit $3.8bn in 2016. With a compound annual growth rate (CAGR) in revenue of 5.8% from 2011 to 2016 it is one of the fastest growing markets in ICT. High end video conferencing (telepresence) will grow even faster, at a CAGR of 19.5% over the same five-year period to become a $1.1bn.
The analyst company’s report - Enterprise Business Video Forecast: 2011-16 – says that the market is driven by an increasing focus on cost-cutting and productivity. Even the executives of major companies are using telepresence - where participants can see each other in life-size images in highly interactive sessions - as a replacement for travelling to face-to-face meetings.
Richard Thurston, author of the report, said: “(Enterprises) are starting to use video conferencing much more frequently because of ongoing economic concerns, continued efforts to reduce their carbon footprint, enhancements in video technology and price reductions that are improving the business case. The next five years will see solid increases in expenditure from businesses in every region around the globe”.
Ovum predicts that businesses will opt for third-party managed services to help them with their telepresence installations - business spending on managed services will increase at a CAGR of 11.5% from 2011 to 2016.
Video conferencing is one area where improvements in technology have come together with business efforts to reduce costs and an increasing green ICT focus. What used to be a poor quality and/or too expensive experience is now a real alternative to travelling to meetings.
Cost cutting may still be the primary reason for implementation, but it won’t be long before companies that don’t make extensive use of teleconferencing and video conferencing, to replace business travel, will come under the spotlight. The need to be a good corporate citizen will drive this green ICT sector in the long term.