Executive Summary
The UK videoconferencing market was worth £90m in 1997, an increase of
25% from 1996. Volume sales rose much faster, by 111.5%. Value spending has
been held back by the rapid reduction in market prices and the shift in the
market towards desktop systems. Currently, the market is dominated by
integrated services digital network-based (ISDN) systems, although local area
network-based (LAN) systems are gaining in importance.
Key drivers of sales are: the introduction of agreed technical standards;
recent price reductions and the falling cost of installation; the rapid growth
of worldwide telecommunications systems (e.g. switched plain old telephone
systems (POTS), high-speed switched local area computer networks, the Internet
and corporate intranets); recent dramatic quality improvements; the
availability of video-enabled PCs; the support given to the market by the
Government and major telecommunications companies; and the proven benefits of
videoconferencing for multinational companies.
The videoconferencing market essentially splits into three broad segments:
conferencing systems, both group and desktop, including hardware and software,
and associated costs, such as installation; other hardware (including
multipoint control units (MCUs), standalone CODECs (compression/decompression),
video modems, etc.); and services (mainly maintenance).
The major issues facing the market now are: the growth of LANs and wide area
networks (WANs) in business; the potential for asynchronous transfer mode (ATM)
to open the LAN and WAN market to videoconferencing systems; the introduction
of new MCUs; and the introduction of new products, like larger screens, compact
systems, sophisticated videophones and plain old telephone-enabled systems
(POTS).
Key Note estimates the UK videoconferencing market will grow by 177.8% between
1998 and 2002. By the year 2000, desktop systems will have overtaken group
systems in terms of value spending, while other equipment sales and sales of
customer services will grow strongly. Services will be the major growth area
over the coming 5 years, albeit from a low base, followed by desktop systems
and then other equipment. Group systems will show strong growth, but at a rate
much lower than the rest of the market.
First Edition 1998
Edited by Phillippa Smith
ISBN 1-85765-792-6
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