International Data Corporation (IDC) has officially published results from its latest report, which claims that worldwide unified communications and collaboration (UC&C) market is on pace to reach $69.1 billion in revenue during 2024, marking a 7.5% increase, as compared to 2023. Furthermore, the same report expects UC&C to compound at a relatively slower annual growth rate (CAGR) of 5.7% to reach $85 billion by 2028. To contextualize these findings, though, one ought to know that IDC defines unified communications and collaboration (UC&C) as a bundled, integrated UC/UCaaS and UC collaboration solution stack which includes 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. These platforms may also include the creation of teams/channels for access-based communications and knowledge sharing, along with specialized tools, such as digital whiteboards, screen sharing, live polls/surveys, questions and answers (Q&As), and meeting scheduling capabilities. If we look beyond the software-based platforms, as well as their communications-focused function, we would see that UC&C market comprises of primary hardware which, on its part, enables such exchanges through avenues like desktop IP phones, videoconferencing endpoints comprising integrated camera, microphone systems, and multipoint control units (MCUs). This it does to accommodate multiple users and devices into a single network. All in all, the UC&C solutions can be, markedly enough, delivered via on-premises infrastructure or on public/private cloud on an as-a-service basis.
Talk about IDC report on a slightly deeper level, though, across the key technology segments of the UC&C market, 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 i.e. 89% during the year 2023. In fact, their share is expected to rise even further, with growth in the hardware segments (IP telephony and enterprise videoconferencing systems) turning largely negative over the forecast period. The UC collaboration segment is being touted to outpace the overall market with a five-year CAGR of 7.6%.
“The UC&C market has matured after significant investments were made in the past few years by businesses to address the changed work environment,” said Jitesh Gera, research manager for Unified Communications and Collaboration at IDC. “In addition, the crowded UC&C market has led many solutions toward commoditization. However, AI is now changing the game altogether, bringing a fresh wave of new and differentiated capabilities that are likely to draw more investments in the coming years as businesses vie for enhanced employee productivity and better customer engagement.”
As for what seems to be driving this UC&C adoption, the answer resides in a continued introduction of artificial intelligence (AI) capabilities across UC&C solutions. A simple example relaying the same would be AI-enabled videoconferencing and telephony solutions that help improve productivity, as well as capabilities designed to improve business outcomes across employees and customers. Anyway, IDC’s study even sees a potential uptick on the cards when it comes to cloud-based UC&C deployments. Not just that, the whole effort forecasts these deployment to replace on-premises deployments altogether, as security and data integrity continue to improve. Apart from that, the integration of UC solutions with contact center platforms will continue as buyers look try and simplify their technology stacks and reduce their administrative load to work with single unified providers of UC, CC, and CPaaS capabilities.
Among other things, IDC’s report also shares how Microsoft remains in lead of the worldwide UC&C market with a 44.7% market share by revenue in Q1 2024. The tech giant is followed by Zoom and Cisco with a 6.4% and 5.5% market share respectively. If we move on from these three, the space is effectively fragmented with several smaller players focused mainly on specific industry verticals or small and medium businesses (SMBs) in specific geographies
