IDC: Cloud, software options deflate sales of enterprise video systems

Sales for this market were 'dismal' in the first quarter of 2014

Sales of video conferencing and telepresence hardware systems are declining, hurt by an increase in cloud and software-based options that often are cheaper and simpler to deploy, according to an IDC study.

In 2014's first quarter, video conferencing equipment revenue shrank 16 percent worldwide year over year to US$473.5 million, while units sold fell 6.2 percent.

Market leader Cisco took a big hit. Its video equipment revenue dropped 22.4 percent. It sat at the top of this shrinking market in the first quarter with a 40.1 percent share of the revenue.

Polycom, whose revenue fell 8.4 percent, was in second place with a 29 percent share, while Huawei took the third spot with a 7.8 percent share and a 2 percent drop in revenue.

So what's behind the market's depression? Customers are delaying purchases as they look for alternatives that are less expensive, software-based and cloud-hosted, signaling a shift away from hardware-based products, according to IDC.

However, video remains a key component of enterprise collaboration stacks in many organizations.

"IDC believes that among the challenges customers are currently trying to work through are a market transition and determining exactly what, when, and how to provision their video deployments as more software-centric and cloud-based service offerings become part of the enterprise video market landscape," said IDC analyst Petr Jirovsky in the statement.

Looking at a couple of specific market segments, multi-codec immersive telepresence equipment revenue fell 33.5 percent and its units sold dropped 26 percent, while room-based video system revenue fell 10 percent and its units sold were down 1 percent.

Revenue dropped year over year in all major regions, falling 19.8 percent in Europe, Middle East and Africa, 16.4 percent in Asia-Pacific, 13.4 percent in North America and 5.1 percent in Latin America, IDC said.

A silver lining is that "most or all" of this market's vendors are responding to the shift by also offering cloud-based video alternatives, according to IDC.

Juan Carlos Perez covers enterprise communication/collaboration suites, operating systems, browsers and general technology breaking news for The IDG News Service. Follow Juan on Twitter at @JuanCPerezIDG.

Join the newsletter!

Or

Sign up to gain exclusive access to email subscriptions, event invitations, competitions, giveaways, and much more.

Membership is free, and your security and privacy remain protected. View our privacy policy before signing up.

Error: Please check your email address.

Tags internetunified communicationsNetworkingvideopolycomCisco SystemsInternet-based applications and servicesTelephony/conferencing

Keep up with the latest tech news, reviews and previews by subscribing to the Good Gear Guide newsletter.

Juan Carlos Perez

IDG News Service
Show Comments

Father’s Day Gift Guide

Brand Post

Most Popular Reviews

Latest Articles

Resources

PCW Evaluation Team

Luke Hill

MSI GT75 TITAN

I need power and lots of it. As a Front End Web developer anything less just won’t cut it which is why the MSI GT75 is an outstanding laptop for me. It’s a sleek and futuristic looking, high quality, beast that has a touch of sci-fi flare about it.

Emily Tyson

MSI GE63 Raider

If you’re looking to invest in your next work horse laptop for work or home use, you can’t go wrong with the MSI GE63.

Laura Johnston

MSI GS65 Stealth Thin

If you can afford the price tag, it is well worth the money. It out performs any other laptop I have tried for gaming, and the transportable design and incredible display also make it ideal for work.

Andrew Teoh

Brother MFC-L9570CDW Multifunction Printer

Touch screen visibility and operation was great and easy to navigate. Each menu and sub-menu was in an understandable order and category

Louise Coady

Brother MFC-L9570CDW Multifunction Printer

The printer was convenient, produced clear and vibrant images and was very easy to use

Edwina Hargreaves

WD My Cloud Home

I would recommend this device for families and small businesses who want one safe place to store all their important digital content and a way to easily share it with friends, family, business partners, or customers.

Featured Content

Product Launch Showcase

Don’t have an account? Sign up here

Don't have an account? Sign up now

Forgot password?