The worldwide unified communications and collaboration (UC&C) market is forecast to reach US$69.1 billion in revenue in 2024, an increase of 7.5% compared to last year, according to a new report from International Data Corporation (IDC) released on Tuesday.
IDC defines UC&C as a “bundled, integrated UC/UCaaS and UC collaboration solution stack that may include an advanced telephony solution integrated with messaging (i.e., email, voice, and fax), instant messaging (IM) or chat, presence, and conferencing platforms for web conferencing, audioconferencing, and/or videoconferencing.”
The research firm notes that during the 2023-2028 forecast period, the market is expected to witness a slightly lower compound annual growth rate (CAGR) of 5.7%, reaching $85 billion by 2028.
Two software segments — UC collaboration (meeting software without voice telephony subscriptions) and unified communications as a service (UCaaS) (meeting software including voice telephony subscriptions) — accounted for most of the worldwide market revenue (89% in 2023), IDC said in a release.
Their share, the research firm said, “is expected to rise further as growth in the hardware segments (IP telephony and enterprise videoconferencing systems) turns negative over the forecast period. Meanwhile, the UC collaboration segment is forecast to outpace the overall market with a five-year CAGR of 7.6%.”
The study noted that among the drivers of UC&C adoption is the continued introduction of AI capabilities into offerings. This, said IDC, includes AI-enabled videoconferencing and telephony solutions that help improve productivity, as well as capabilities that improve business outcomes across employees and customers.
Jitesh Gera, research manager of unified communications and collaboration at IDC, said in an email, “AI appears to be the primary focus area for all UC&C vendors at the moment, especially since early 2023 when Microsoft launched Copilot.
Most companies, he said, “started with focusing on AI-based meeting transcriptions that power the creating of automated meeting summaries, notes, and action items. However, many are now moving towards more advanced capabilities like live coaching assistance for employees in customer-facing roles and productivity enhancements through automated content creation via integrations with email, presentation, and document management applications. These capabilities are also being applied to voice telephony for better customer interactions.”
Asked if these extra AI features are going to be bundled or come at an extra cost, straining CIO budgets, Gera said that while these are deemed to be valuable capabilities for businesses, they are still “nascent in terms of how they are packaged into UC&C solutions and the extent of time they have been used by organizations. Therefore, the market has not yet been able to properly quantify the productivity and collaboration enhancements AI capabilities can lead to.”
Some companies, like Cisco and Zoom, are including AI features in all their paid subscription plans, and others, like Microsoft, are charging separately for Copilot, he said.
Gera said, “it is important to note, though, that the value proposition for these organizations varies, as Microsoft’s Copilot takes a more holistic approach by covering many office productivity applications in addition to Microsoft Teams. Therefore, I think the monetization approach towards AI would vary by UC&C vendor, depending on factors like the stickiness of the platform with users, value added to the users businesses, and the sheer breadth and accuracy of the features to actually improve user experiences.”
Microsoft continued to lead the worldwide UC&C market with a 44.7% market share by revenue in Q1 2024, the release stated. It added that Zoom and Cisco followed distantly with a 6.4% and 5.5% market share, respectively. Other companies or offerings named in the report include Slack, Google Meet, Unify and Avaya.
IDC said it also expects cloud-based UC&C deployments will increase over time, replacing on-premises deployments as security and data integrity continue to improve. In addition, “the integration of UC solutions with contact center platforms will continue as buyers look to simplify their technology stacks and reduce their administrative load to work with single unified providers of UC, CC, and CPaaS capabilities.”
The worldwide unified communications and collaboration (UC&C) market is forecast to reach US$69.1 billion in revenue in 2024, an increase of 7.5% compared to last year, according to a new report from International Data Corporation (IDC) released on Tuesday.
IDC defines UC&C as a “bundled, integrated UC/UCaaS and UC collaboration solution stack that may include an advanced telephony solution integrated with messaging (i.e., email, voice, and fax), instant messaging (IM) or chat, presence, and conferencing platforms for web conferencing, audioconferencing, and/or videoconferencing.”
The research firm notes that during the 2023-2028 forecast period, the market is expected to witness a slightly lower compound annual growth rate (CAGR) of 5.7%, reaching $85 billion by 2028.
Two software segments — UC collaboration (meeting software without voice telephony subscriptions) and unified communications as a service (UCaaS) (meeting software including voice telephony subscriptions) — accounted for most of the worldwide market revenue (89% in 2023), IDC said in a release.
Their share, the research firm said, “is expected to rise further as growth in the hardware segments (IP telephony and enterprise videoconferencing systems) turns negative over the forecast period. Meanwhile, the UC collaboration segment is forecast to outpace the overall market with a five-year CAGR of 7.6%.”
The study noted that among the drivers of UC&C adoption is the continued introduction of AI capabilities into offerings. This, said IDC, includes AI-enabled videoconferencing and telephony solutions that help improve productivity, as well as capabilities that improve business outcomes across employees and customers.
Jitesh Gera, research manager of unified communications and collaboration at IDC, said in an email, “AI appears to be the primary focus area for all UC&C vendors at the moment, especially since early 2023 when Microsoft launched Copilot.
Most companies, he said, “started with focusing on AI-based meeting transcriptions that power the creating of automated meeting summaries, notes, and action items. However, many are now moving towards more advanced capabilities like live coaching assistance for employees in customer-facing roles and productivity enhancements through automated content creation via integrations with email, presentation, and document management applications. These capabilities are also being applied to voice telephony for better customer interactions.”
Asked if these extra AI features are going to be bundled or come at an extra cost, straining CIO budgets, Gera said that while these are deemed to be valuable capabilities for businesses, they are still “nascent in terms of how they are packaged into UC&C solutions and the extent of time they have been used by organizations. Therefore, the market has not yet been able to properly quantify the productivity and collaboration enhancements AI capabilities can lead to.”
Some companies, like Cisco and Zoom, are including AI features in all their paid subscription plans, and others, like Microsoft, are charging separately for Copilot, he said.
Gera said, “it is important to note, though, that the value proposition for these organizations varies, as Microsoft’s Copilot takes a more holistic approach by covering many office productivity applications in addition to Microsoft Teams. Therefore, I think the monetization approach towards AI would vary by UC&C vendor, depending on factors like the stickiness of the platform with users, value added to the users businesses, and the sheer breadth and accuracy of the features to actually improve user experiences.”
Microsoft continued to lead the worldwide UC&C market with a 44.7% market share by revenue in Q1 2024, the release stated. It added that Zoom and Cisco followed distantly with a 6.4% and 5.5% market share, respectively. Other companies or offerings named in the report include Slack, Google Meet, Unify and Avaya.
IDC said it also expects cloud-based UC&C deployments will increase over time, replacing on-premises deployments as security and data integrity continue to improve. In addition, “the integration of UC solutions with contact center platforms will continue as buyers look to simplify their technology stacks and reduce their administrative load to work with single unified providers of UC, CC, and CPaaS capabilities.” Read More
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