This post was written by Melanie Turek, principal analyst at Frost & Sullivan.
Frost & Sullivan has just released its latest study on the Unified Communications market. As the principal analyst covering UC for the firm, I take a conservative view of the UC market, but even so, we saw remarkable growth year over year.Now, before you freak out over that $71 million, consider how we defined the UC market for this study. I like to think of the term unified communications as having both a macro and a micro definition. From a macro perspective one can take UC to mean any integration-or unification-of at least two communications applications. This is the Cisco definition of the term, which is why the company can stick the "Unified" label on all its communications products, and there is some value in it beyond mere marketing; if nothing else, it defines a key trend in the communications industry. But it does not do much to define a market category, since the macro definition merely comprises a large collection of existing communications markets (voice, conferencing, instant message, etc.).
Therefore, for the purposes of this study, Frost & Sullivan defines a unified communications application as an integrated set of voice, data and video communications, all of which leverage PC- and telephony-based presence information, and which are meant to simplify communications for the end user by making it easy to "click to communicate." To put it simply, UC isn't just OCS-it's OCS (presence, IM, conferencing) with the telephony capabilities deployed.
There are several key takeaways from our study:
* The 2008 unified communications market is extremely nascent. Total corporate customers number in the thousands, each deploying to a few hundred, or in rare cases a few thousand, users. However, the deployment rate is growing fast.
* We believe the addressable corporate UC market is roughly equal to the number of enterprise e-mail seats deployed at any given time.
* Growth will come from several places: SMBs will likely deploy all-in-one applications or hosted services to their end users with minimal disruption for IT; large enterprises are expected to deploy UC solutions from multiple vendors, as they start to give a full set of capabilities to their end users while taking advantage of existing technologies and best-of-breed applications; and those same large companies will need to engage for managed and/or professional services to make their deployments work.
* Because unified communications comprises a number of other software and services, UC revenues will likely impact revenues in other markets, including conferencing, IM and telephony. Since many UC vendors also sell those products, a growth in UC does not necessarily translate into parallel growth in any given vendor's revenues; pricing pressures will further that effect. UC growth also will likely negatively impact other markets, especially instant messaging and audio and web conferencing.
* Although IP-based communications, and VoIP in particular, are drivers for UC deployment, we expect to see an adoption gap between the two for the forecast period (2008-2013). That is, companies that deploy VoIP will not all immediately deploy presence-based IM, conferencing and unified messaging.
* The effect of the economic slowdown will be double-edged. On the one hand, as many vendors made clear at VoiceCon, unified communications can help companies cut IT, travel and facilities costs and support a more virtual workplace. On the other hand, history shows us that in times of fiscal crisis, the majority of companies hunker down, slash budgets and avoid risk, which rarely leads to new investments.
The bottom line: The enterprise communications team at Frost & Sullivan is bullish on UC for many years to come, but we also caution companies to remember their corporate IT history: Few technologies go from new to necessary in an instant. To learn more details on the research-including market share breakdowns among vendors in the space, and data cuts that focus on specific elements of and approaches to UC, please join us for our Webinar on December 16 at 1pm ET.
