Cloud and hosted UC services outpace growth on-premise

In addition to the Secure Access Service Edge (SASE) and SD-WAN markets, the “collaboration market” has benefitted in a big way from increased demand due to the rise of hybrid working during the pandemic, according to Synergy Research Group.

Spending for on-premise and cloud collaboration services grew 8% year-over-year (YoY) for Q2 2022, and hit nearly $15 billion per quarter.

All about the cloud

The transition from enterprise use of on-premise products to cloud and hosted services has also been a boon for the collaboration market, which includes as-a-service (aaS) software such as UCaaS (unified communications), CCaaS (contact center) and CPaaS (communications platform). These three services together grew 17% from last year and now account for more than $7 billion in quarterly spending.

All video all the time

IDC released a similar analysis of the global Unified Communications & Collaboration (UC&C) market, stating that it grew 11.4% YoY for Q2, reaching $14.8 billion. The market was up about 3% compared to Q1. IDC researchers noted that UC&C growth will continue as a result of increased interest in video conferencing, collaboration and UCaaS technologies.

Synergy’s Jeremy Duke echoed the sentiment that interest in collaboration features such as video conferencing are on the rise. New market opportunities have opened up during the pandemic within the collaboration sector, “especially in video conferencing services and devices, rapidly driving change that would otherwise have taken a decade to achieve,” explained Duke.

“The collaboration market continues to evolve rapidly, as new technologies and services emerge that increase both management capabilities and productivity of in-office, remote and hybrid workers,” added Duke, Synergy Research Group’s founder and chief analyst.

Long-term strategies for UC

Ericsson is among those taking advantage of the collaboration market boon by acquiring UC provider Vonage for $6.2 billion, though not without some confusion from investors. Ericsson’s share price fell 6% when the deal was announced, reported Light Reading’s Iain Morris. While the UC market is clearly doing well, it’s not obvious why a vendor such as Ericsson, which has been vocal about its focus on 5G, would choose to acquire a UC company.

To read the complete article, visit Light Reading.