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Telepresence and Videoconferencing Advance

People -- both at work and at home -- are mixing video into their communications more often and in a greater variety of ways. That is part of the reason that telepresence and videoconferencing are growing. The category, analysts say, also is being helped by a desire to cut travel due to cost and security concerns. 

 By Carl Weinschenk | Posted Mar 29, 2011
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The advance of video across all electronic communications frontiers – including both personal and business sectors – clearly is one of the biggest stories of the decade. There is perhaps no area where that growth is better illustrated than in telepresence and videoconferencing.

It stands to reason that the markets are increasing. How quickly this is happening may be a bit surprising, however. Infonetics Research released market projections last week that suggest that the number of employees who will be looking at the people to whom they are calling will accelerate rapidly over time.

The firm found that the two sectors collectively grew 18 percent to $2.2 billion worldwide during 2010. The firm expects the market to hit $5 billion by 2015, with “immersive telepresence systems” enjoying the fastest growth. Most equipment will be deployed in multipurpose rooms, and software-based endpoints will use their lower cost structure and availability to out-ship hardware endpoints by a factor of 10 to 1. The top two vendors are Cisco and Polycom. Cisco, Infonetics said, has parlayed the acquisition of Tandberg to a 50 percent share of the market last year. Polycom was second in revenue and led in units shipped.

Zacks Investment Research offers a succinct post at Wall Street Pit summing up the positive momentum for the telepresence and videoconferencing players. The piece, which referenced the Infonetics research, was bullish:

We believe, in the long-run, the videoconferencing solutions market will see healthy demand as a result of several positive industry trends, including globalization and the proliferation of branch offices; concerns about time demand and high cost of travel; homeland security and other government initiatives; as well as distance learning and healthcare applications.
Last month, ABI Research released numbers and insight into the market. The press release suggests that the growth of videoconferencing and telepresence has led to growth in the related hosted and managed telepresence and videoconferencing services market. The bottom line of the release – and presumably the report – is that companies like video communications and it is growing. It is a tricky technology, however, and impractical for most companies to do on their own, so a “parallel market for managed services” has emerged.
 
ABI also pointed to aggressive growth in the managed services portion of the overall telepresence and videoconferencing sector. The firm said that the sector will reach $1.2 billion by 2016, which would represent a compound annual growth rate (CAGR) of 19 percent. The market grew by 25 percent last year alone and finished the year at $512.5 million.

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