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COVID-19's Long-term Impact on Remote Work and Learning
Businesses and educational institutions across the world are rapidly responding to the COVID-19 pandemic by implementing travel restrictions and work from home (WFH) and remote learning policies. To ensure business continuity during this crisis, these organizations must have robust, easy-to-use communication tools that enable remote work and learning. Video conferencing and group chat are coming to the rescue.
WFH: Leveraging Video Communications to Keep Employees Safe
The COVID-19 crisis is expected to have a lasting impact on how organizations view remote work — changing with it the communications and collaboration industry forever. Guidelines are being laid out by health and government agencies, and many businesses are rolling out mandatory WFH. For enterprises that are prepared, it’s “business as usual” or as close as one can get to it in times like these. However, for those that don’t have comprehensive WFH tools, this is a transformative moment.
Frost & Sullivan’s early data shows that this wave of WFH is creating an unprecedented base of new users as well as a rapid rise in usage among existing users that will leave an indelible impact on technology adoption and growth in years to come.
The technology and usability improvements that collaboration tools have seen over the last few years are coming handy, just as the world needs them the most. UCC providers from across the spectrum have also risen to the challenge and announced free offerings to accommodate quick and easy access to users who are working and learning from home. 8x8, Amazon Chime, AT&T, Avaya Spaces, Bluejeans, CafeX, Cisco Webex, Google Hangouts Meet, Lifesize, LogMeIn GoToMeeting, Microsoft Teams, PGi, RingCentral, Slack, and Zoom are among the many providers that have either announced free services or extended the reach and removed time limits for existing free offers. This roster of vendors is expected to grow as the number of COVID-19 cases rise globally.
Providers across the board are reporting unprecedented growth in usage. Cloud video conferencing service provider Pexip has seen 200% growth in cumulative usage over the past month, with peak usage surging to nearly six times the peak in Jan. Similarly, BlueJeans has seen three times global usage growth, and Fuze has seen an increase in meetings by 251% over the past few weeks. Communication device vendors like Poly and Logitech are seeing a spike in demand too. Meeting room devices, that pair with leading cloud services to deliver a better together experience, are a high growth market. Neat, which entered the market in late 2019 with a portfolio of meeting room devices designed exclusively for Zoom, has been inundated with orders/inquiries, many of which are specifically being quoted by customers with COVID-19-related concerns.
Below we take a closer look at the growth and how several providers are responding to COVID-19:
- Webex has reported 6.7 billion meeting minutes so far in March and is hosting more than 4 million meetings a day globally, not including one-on-one calls. This represents a significant growth compared to 6 billion meeting minutes per month announced in Jan.
- On March 10, Webex reported that more than 30% of its top global enterprises have asked to help them scale remote work — either increasing the number of users with access to Webex Meetings, or the overall volume of meetings taking place.
- As of March 10, volume on Webex Teams messaging increased 35% from Feb.'s daily highs.
- In Feb., Cisco reported that the number of meetings and total minutes had doubled among users in Japan, Singapore, China, and South Korea. In the first week of March, it continued to rise. Free sign-ups in the then impacted countries were up seven times over pre-outbreak sign-up rates. In the first week in March, that trend held steady. EMEA sign-ups jumped by 211%.
- On March 13, Microsoft reported that its Teams collaboration platform has seen a 500% increase in meetings, calls, and conferences.
- Teams also saw a 200% increase in usage on mobile devices in China, since Jan. 31.
- Microsoft launched a comprehensive COVID-19 resource to provide updated, cross-company information. Cross-company content areas include remote working, education, community support, and tech support.
- Neat has seen solid demand since its all-in-one video appliances went GA in Jan. Sales have risen by high double-digits week-over-week for the first two weeks of March. Orders for the week beginning March 9 doubled over the prior week.
- Based on its current run rate, Neat’s sales for 2020 are poised to be five times its original projections for the year.
- For the weekend of March 14-15, Neat hit a record number of orders booked compared to any other weekend since it announced its products in Oct. 2019. Over the same weekend, Neat also took in the largest number of orders from its ecommerce site as compared to weekends past.
- A fair number of state and local agencies have purchased Neat Bars, specifically to command their COVID-19 efforts.
- While Zoom hasn’t shared usage stats since the onset of COVID-19, Frost & Sullivan estimates that it has seen “dramatic increases” in usage, significantly up from its 100 billion minutes run rate at the end of January. On March 11, 343,000 people globally downloaded the Zoom app, 60,000 in the U.S., as compared to 90,000 people worldwide (27,000 in the U.S.) two months ago, according to Apptopia.
- Prior to COVID-19, Zoom reported that’s its cloud service logs more than 40 million hosted meetings and 8.6 billion meeting minutes per month.
- In 2020, Zoom stock has gone up by 58% (as of March 16). Overnight, Zoom has become a mainstream communications tool as well as a social platform for millions, including school and college students, church and concert-goers, and families and friends looking to connect amid social distancing.
- Last week, Zoom ranked third among all free apps in Apple’s App Store, behind only TikTok and Google. As more and more live events turn into virtual events due to travel restrictions, Zoom Webinars are seeing a significant uptake too.
- Zoom was among the first in the UC industry to turn a live industry event, its analyst Perspectives 2020 event, into a virtual one as a result of COVID-19. In addition to video conferencing and content sharing, Zoom interspersed the day-long event with interactive polls and chat to keep attendees engaged. Virtual backgrounds came in handy for attendees joining from their homes, and Zoom’s real-time transcription saved time on note-taking, so attendees could focus on the content. With Perspectives 2020, Zoom set the stage for a well-run virtual event in times when travel restrictions are becoming the norm. See Zoom’s best practices for hosting a digital event here.
Remote Learning: Covid-19 Solidifies Emerging Trends
Educational institutions across the globe have taken a big hit from COVID-19. Colleges and universities in particular are at high risk of spreading the disease due to dense student body populations. Similarly, hundreds of K-12 schools have been shut down to contain the outbreak. In response, school administrators and teachers have been given the onerous task to convert in-person curriculums into online courses, and quickly put in place virtual classroom solutions to allow millions of students to continue learning from their homes.
Online education has seen exponential growth in recent years. From 2008 to 2017, the percentage of undergraduates enrolled in the U.S. in at least one distance education class expanded from 20-32% of all enrollments, according to the Institute of Education Sciences. Often students are the pioneers in new technology adoption, setting the pace for other vertical industries. Educational institutions have been an avid adopter of advanced synchronous and asynchronous communications for online learning. Rapid consumerization, the impact of social media, and the growing popularity of flipped classrooms and blended learning have led to the increasing use of technology in education.
Video conferencing-based remote learning keeps students engaged with features like whiteboarding, annotation, group chat, breakout rooms, attention tracking, etc. Many K-12 schools have been avid users of Google Classroom, the online platform that allows teachers to post videos and assignments Covid-19 has unexpectedly and suddenly shone a light on the need for a comprehensive plan to substitute in-person classes with remote learning not only during contingencies but also during normal times as a means to improve the quality and reach of education.
Many universities are already leveraging video conferencing as a key part of their educational toolset. Arizona State University, one of the largest universities in the nation, tested video conferencing in the second week of March and held 170 classes with 7,000 students using Zoom. Similarly, UC Berkeley has suspended in-person classes and is offering courses using Zoom and course-capture solutions. The University of Bologna, Italy, which has an enrollment of over 80,000 students, switched 90% of its courses to online using Microsoft Teams to run virtual classes within 3-4 days after the Italian government closed the doors.
Vendors that have announced support for education include Avaya which is offering Avaya Spaces collaboration software free to all education institutions along with non-profit organizations worldwide. Similarly, Zoom has lifted the 40-minute meeting limit on free Basic accounts for K-12 schools in the U.S. as well as several countries.
Long-term Implications: Why is This Time Different?
This isn’t the first time that the video conferencing industry has seen a spike in demand. In years past, events such as Sept. 11 and the SARS outbreak have prompted businesses to use video meetings in lieu of travel. However, past surges failed to leave a lasting impact on the industry. Frost & Sullivan research shows that only 6% of all meeting rooms globally are video conferencing enabled. The scale of the disruptions caused by COVID-19, however, is truly unprecedented and is expected to fundamentally change user behavior towards remote work and online education.
Part of what makes this crisis different is the technology that is enabling the response. Previous generations of video conferencing technology were complex, clunky, and costly to operate. Modern video meetings are simple to deploy, easy to use, and affordable for businesses of all sizes. However, the stickiness this time goes beyond technology considerations and touches upon human nature – the one constant that impacts adoption more than any other factor.
In recent research, Frost & Sullivan has pointed at the growing future of work trends such as the rise in distributed, dynamic, and on-demand work enabled by next-gen cloud and software delivery. COVID-19 will accelerate the need for flexible and agile work styles and further push the adoption of technologies that improve work-life balance.
As the containment response to COVID-19 leads to quarantined cities, enforced social distancing, and office and school closures, its impact on video conferencing in 2020 and years beyond will be disruptive. It will also have a far-reaching and sustainable impact on user awareness, and ultimately, acceptance and adoption of remote working. Adoption will be shaped by many factors, including:
- Growing macroeconomic uncertainty – The ramifications on IT budgets will be significant. Growing fears of prolonged economic weakness often mean IT budgets will get constrained. It’s reasonable to assume that video conferencing spending will take a hit. However, the longer impact of budget cuts will likely be offset by the lower total cost of ownership (TCO) of today’s meeting solutions. Budget-friendly, robust all-in-one video conferencing appliances and USB conference cams for huddle rooms and small meeting spaces will continue to see rapid growth as they offer an easy-to-use, flexible option, designed for the modern workplace.
- Cloud- and hardware-as-a service (HaaS) – “As-a-service” models will thrive since they minimize strain on IT budgets and allow meeting room-enablement over a single OpEx-based contract, while allowing organizations to flexibly scale usage up and down as needed.
- Hyperscale computing – As usage grows exponentially over the next months, COVID-19 will be a true test of public cloud providers’ ability to scale without downgrading the quality and reliability of the service. Providers across the board have expanded capacity to meet the increased demands of both paid and free users. Many already have robust cloud infrastructures that can sustain peaks in usage. However, scaling a platform beyond a certain threshold isn’t just a matter of additional network capacity, it also requires adding physical hardware within existing data centers. Many providers may also be faced with the predicament of limiting new free signups to ensure quality and consistency for existing users. Providers with a truly scalable and globally distributed architecture will stem the tide better than others.
- Supply chain disruption – Many device vendors that have a healthy inventory have reported that they aren’t seeing any material consequence so far from supply chain disruptions. Some of the best supply chains in the world are in China. Video conferencing device vendors that have increasingly built their products using “standardized” components versus custom componentry will be situated better to combat supply chain disruptions. Similarly, vendors that are more distributed and have multiple suppliers for the most critical components will see lesser disruptions.
- Free to paid conversion – The rapid response by UCC providers and the willingness to come forward and support users with free offerings during the sudden disruptions caused by COVID-19 is unprecedented. This will generate significant goodwill for the providers, an immense base of free users, and the opportunity to convert them to paid accounts in future. Though this bodes well for technology adoption, it also poses several challenges. Providers will have to decide how long to extend their free services in a very fluid environment. The ability to gracefully wean users off of free services into a paid engagement will ultimately determine if providers will see a sustainable revenue impact from the upsurge in user demand. Freemium conversion rates for SaaS communications software have typically been in the low single-digits, though companies like Slack and Zoom have seen significantly higher conversion rates. During COVID-19, millions of users are experiencing first-hand the power of video collaboration to connect people. This viral growth will lead to higher than expected conversion rates over the mid-to-long term.
- Security and manageability – The rapid introduction of video tools for workers across the organization and in educational settings will raise the inevitable question about data collection, security, and user privacy. As organizations across the globe hunker down and focus on providing easy access to all, the long-term implications on security, manageability, and ability to monitoring will require comprehensive provider support.