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December 03, 2008

Frost & Sullivan Report Finds Significant Growth Opportunities in Audio Conferencing

By Susan J. Campbell, TMCnet Contributing Editor

As the pressure to “go green” intensifies throughout the global economy, companies have gained a heightened social consciousness, highlighting their green initiatives and efforts to reduce carbon footprints. Many of these strategies include implementing audio conferencing and bridging technologies.

New analysis from Frost & Sullivan, World Audio Conferencing Bridge Markets, has found that the audio conferencing and bridging market earned revenues of $116.3 million in 2007. The firm also estimates that this will reach $200 million in 2014.

The ongoing drive toward greater globalization and virtualization has been a significant market influencer. This drive has also heightened the need for geographically dispersed businesses to communicate effectively.

Audio conferencing vendors should seize this opportunity in order to address the requirement for economical and real-time communication solutions for long-distance business collaboration. In doing so, these vendors should be able to significantly grow their market share and drive increasing revenues.

Vendors have also been discontinuing support of legacy time division multiplexing (TDM) systems that are reaching the end of their useful lives. As a result, they are focusing on Internet Protocol (IP)-based systems to infuse fresh life into the market and aid greater adoption.

"The ongoing transition to IP, increased focus by businesses on using collaborative solutions, and spotlight on unified communications are offering new growth opportunities as well as challenges to audio conferencing vendors," said Frost & Sullivan (News - Alert) Industry Analyst Krithi Rao, in a Wednesday statement.

"Like other conferencing markets, the audio conferencing bridge market is undergoing a transformation in product features, functionality, and end-user needs as it becomes a key element in implementing a collaborative workplace."

The promising news in the industry is that port shipments of audio conferencing bridges are expected to continue to rapidly rise. On the downside, this increase could be offset by the continuous price erosion.

Bridge vendors will have to endure the impact of the onset of reservationless services and commoditization in the audio conferencing services market. Service providers are expected to transfer this price pressure to them, thereby causing revenue growth to lag behind shipment growth.

"The market is quickly adopting a new generation of IP-based, larger port capacity, flexible audio conferencing solutions that comprise IP-based media servers working along with low-cost application servers," observed Rao.

"Further, as audio conferencing gets rolled into a complete solution with IP telephony, messaging, audio, video, and web conferencing, calendaring, and eventually, unified communications, vendors will experience greater price pressures."

A constant stream of demand and revenue is expected once audio conferencing becomes integrated with a larger communications suite and a wider feature set aids assimilation with other unified communications applications.

There are also significant global growth opportunities as the demand for collaboration services have been amplified in Europe, the Middle East, Africa and the Asia Pacific and Central and Latin America where audio conferencing is not heavily commoditized.

To maximize these growing opportunities, vendors must continuously improve the simplicity of provisioning, ease-of-use, and management to facilitate additional call usage, thereby saving time and costs for customers.

"The availability of easy-to-use software-based low-cost bridge solutions that meet the needs of the small and medium business (SMB) segment further expands the target market," noted Rao.

"As conferencing applications gather speed to reach critical mass during the next few years, Frost & Sullivan expects the audio conferencing bridge market to benefit as well."

The global economy is presenting significant opportunities for the audio conferencing and bridging markets to continue to grow. Vendors will need to pay attention to market drivers and the conditions in specific areas to maximize their potential. The opportunities are there, it is up to these vendors to drive their own strategies to achieve market dominance.

Susan J. Campbell is a contributing editor for TMCnet and has also written for To read more of Susan's articles, please visit her columnist page.

Edited by
Stefania Viscusi

Technology Marketing Corporation

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