Frost & Sullivan Survey Predicts Growth for CSP Videoconferencing

Updated: January 07, 2011

Frost & Sullivan'slatest study predicts ongrowing growth in the North American conferencing service provider (CSP)-based Videoconferencing Services Market. The study reported a revenue growth of 18% in 2009, reaching $184.2 million by the end of the year and projected a compound annual growth rate of 18.4% from 2009 to 2016, bringing the total market to $599.6 million. The videoconferencing services market will likely continue growing for a long time, as more and more companies adopt videoconferencing and find themselves facing unfamiliar challenges such as ensuring interoperability among multiple vendors and across networks and tackling network redundancy.

Growing communications traffic on IP bandwidths will also limit the bandwidth available for video, forcing IT managers to create increasingly complex plans to accommodate bandwidth-intensive services like HD videoconferencing and telepresence. New advances in videoconferencing models will likely complicate interconnectivity between new and old models and different conferencing systems across organizations. Videoconferencing services can help companies address these and other issues associated with the growing market far more effectively and efficiently than most in-house technicians.

The study focused on two different videoconferencing service models: hosted videoconferencing services and the emerging videoconferencing and telepresence managed services model. The managed services model was the clear winner in terms of growth, with a growth rate of 26% in 2009 to reach $115.2 million by the end of the year. Frost & Sullivan predict continued growth for managed services with a compound annual growth rate of 23.4%, far exceeding that of the market as a whole, to reach $503.3 million by 2016. Hosted videoconferencing, by contrast, only grew at around 7% to reach $69.0 million. Writer Melanie Turek identified pricing pressures and lower demand as the primary causes behind this differencein growth, claiming that “companies continue to see better value in buying bridges and employing a provider to manage their videoconferencing infrastructure.”

Featured Research
  • 7 Signs it's Time to Upgrade Your Video Conferencing System

    We’ve widely covered the importance of video conferencing tools for businesses of all sizes - but simply having a video conferencing tool isn’t enough. An outdated solution that isn’t providing all the communication tools your business needs will only hold you back. If you’ve had your current solution for any length of time, you should perform a quick assessment to make sure it’s still the right tool for your business. more

  • Why Q4 is the Perfect Time to Invest in Video Conferencing

    If you’re currently relying on an outdated video conferencing solution - or if you don’t have one at all - you’re in luck. While any time is a good time to invest in video conferencing, Q4 may be the best. One big reason is that Q4 is when you can get the best deals, but there are also other important factors like increased access to seasonal employees. more

  • Video Conferencing Showdown

    If you feel overwhelmed by the video conferencing options available for your business, you aren’t alone. There are dozens and dozens of different solutions, ranging from no-cost options to software that will cost thousands. The question is which one is right for your business and how can you get the most value. more

  • Best Video Conferencing Features for Business

    Most businesses are currently underutilizing their video conferencing software because they aren’t aware of the different ways it can be used. Understanding the different features of video conferencing software can be critical to getting the most out of your investment. These features often vary from one option to the next as well, so it's important to do your homework before choosing a specific service. more

  • 9 Ways Video Conferencing Supports Business Growth

    90% of information is transmitted in the human brain is visual, and people process visuals 60,000 times faster than text. Video and video conferencing is fastly becoming the new must-have business tool for generating profits and successfully growing your business. In fact, over the past four years, the percentage of companies utilizing video conferencing has jumped from 41% to 58%. more