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Pandemic sparks revenue climbs in unified comms and collaboration

IDC has shared its views of what happened in the market in the second quarter, with the shift to home working having a clear impact on demand

The coronavirus pandemic has fuelled a boom in the use of unified communications and collaboration (UCC) tools due to the millions of people working from home.

Players such as Zoom, RingCentral, Microsoft with Teams and Cisco’s Webex service have all seen significant increases in usage numbers, helping the unified communications (UC) market grow during the height of the lockdown.

IDC numbers covering the second quarter revealed that worldwide UCC revenue increased by 25.1% year over year (YoY), and 12.4% quarter over quarter to $11.5bn in the second quarter.

Tools that could help workers continue to be secure and productive at home were some of the largest growers in terms of revenue. IDC broke down the categories to reveal that the UC collaboration market, which includes video-conferencing software and cloud services, produced a 46.9% increase in revenues. The managed/hosted voice/unified communications-as-a-service (UCaaS) market also improved by 20.4% YoY, and enterprise video-conferencing systems were also up by 21.5%.

Not all areas saw growth, however, and the IP telephone and on-premise UC systems segment delivered a 21.8% decline in the second quarter.

“In the second quarter, organisations worldwide turned to video and collaboration solutions in particular to meet work-from-home employee requirements during an extraordinary time of crisis,” said Rich Costello, senior research analyst of UCC at IDC.

“In the second half of 2020, and beyond, as some organisations begin to move from crisis phase to recovery phase, IDC expects that worldwide UCC growth will be driven by customers across all business size segments, with interest especially in cloud-based solutions for voice, video and collaboration, mobile applications, and digital transformation projects,” he added.

Revenues across Europe, Middle East and Africa (EMEA) were up by just shy of 20% in the second quarter, with all major market experiencing solid double-digit growth in the quarter.

Those vendors that operate in the UCC market all saw their revenues improve, including Microsoift, Cisco, Zoom, Avaya and RingCentral.

Many market watchers are expecting the new normal to include continued high levels of people working from home, and vendors are reacting accordingly with more services being developed to meet that demand. One example of this comes from RingCentral UK, which recently added in video meetings functionality into the Microsoft Office solution it offers across Europe.

“Businesses are enabling their people to work from anywhere and stay connected. It’s becoming increasingly important that the communications platform and tools businesses are using are secure and trusted,” said Will Moxley, chief product officer at RingCentral.

Microsoft also used its recent Ignite conference to signal that more functionality was coming in the near future to its Teams video-conferencing offering, including breakout rooms and improvements in the way users could deliver presentations.

“We are experiencing digital transformation at epic speed. Covid-19 has accelerated secular trends in the ways we work and live, jumpstarting durable new habits that will persist well past the pandemic,” stated Jared Spataro, corporate vice-president for Microsoft 365.

“Throughout 2020, as we’ve navigated the equivalent of a year of digital transformation every month, it’s IT pros who’ve led the way. When Covid-19 caused a sudden shift to remote work, IT pros brought entire organisations online – sometimes over a single weekend.

“They trained individuals and teams on essential new tools, quickly deployed custom apps, and vigilantly protected organisations from increasingly complex security threats. Now, as business leaders look to build resilient organisations and find new opportunities for expansion, they’re looking to IT pros for sustainable solutions to support them for the long haul,” he added.

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