Videoconferencing market sees 20.3% spike in Q3 to $680.4M in revenue

Enterprise adoption of videoconferencing and telepresence continues to gather speed, with the global market seeing a 24.3 percent year-over-year revenue increase in the third quarter to $680.4 million, according to new research.

International Data Corporation said the single-codec telepresence segment of the market grew 36.6 percent year over year to $379.7 million and now accounts for 55.8 percent of the total market.

Cisco (Nasdaq: CSCO) continued to set the pace for the overall market, seeing a 32.5 percent year-over-year increase in the third-quarter. With 51.6 percent of the market at the end of the quarter, it continues to grow its dominance in the space. The company had a 50.4 percent market share in the second quarter and a 48.4 percent share in the year-ago quarter.

Polycom (Nasdaq: PLCM), meanwhile, saw its telepresence and videoconferencing revenue increase 19.4 percent in the third quarter of 2011, which is consistent with Polycom's longer-term growth. Polycom has seen 19 percent to 26 percent year-over-year increases in its revenue every quarter since the first quarter of 2010.

IDC analyst Rich Costello said improvements in networking, videoconferencing and telepresence technologies have finally made it a serious player in the enterprise space, saying, "Only recently have enterprise networks and videoconferencing technology, epitomized by HD and telepresence systems, been capable of delivering collaboration experiences worthy of initiating a video session, versus having a conference call or hopping on a plane."

Those improvements have been significant enough to serve as a catalyst for growth in the market.

"IDC expects major revenue growth in this market to continue over the next five years, bolstered by a significant impact from unified communications, collaboration applications, telepresence systems, and desktop and mobile devices supporting video," he said.

Petr Jirovsky, senior research analyst, Worldwide Networking Trackers Research, predicted the segment is "one of the fastest growing large networking markets with more than 20 percent year-over-year growth in three of the last four quarters."

For more:
- see this release

Related articles:
Report: Enterprises going mobile, seek UC, videoconferencing solutions
Research: Video-conferencing to see CAGR of 19% through 2015
Study: Some workers still balk at videoconferencing