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The Year was so Bright You Gotta Wear Shades - Wainhouse Research Revisits their 2014 Collaboration and Conferencing Predictions
As we wrap up 2014, we bring to you our recap describing how we think we did on our 2014 predictions. Reprinted here are predictions for Y2014 that we made in the Volume 15, Issue 1 way back on January 9, 2014. On top of what the rest of the world was talking about -- you know, wars to oil prices, Uber to the Ukraine, and ebola to elections, we were attending to adoption of collaboration technologies. We pronounce the UC&C market alive and kicking. We'll be back next month with our predictions for 2015 and a brand new look and user experience of your favorite industry and market news source. Until then: Happy Holidays to your and yours from the entire Wainhouse Research team!
Here we note analyst, prediction, and self-assessment, using three metrics: 1) Nailed it (100% accurate); 2) Almost (or) halfway got it (50%-75% accurate); 3) Missed it but who the heck knows the future? (Missed on all points but fortunately we can still have fun with it). And note: as you will see, we get to disagree around here.
Andrew W. Davis
Prediction: The traditional VC endpoint business will be down in 2014 and this will cause several changes: 1) at least two senior exec level turnovers; 2) at least one major player will adopt a sell direct strategy; and 3) a channel partner revolt will open an opportunity for China-based vendors in western and developing markets. Finally: WebRTC will still be insignificant at end of year. Hype around WebRTC far exceeds the reality. There are lots of technology / political glitches for one, and another is that when you think about it, most of the functionality has existed for quite a while.
Recap: Nailed it. I said the video conferencing segment would be down in 2014 and it is considerably. And that this would cause several changes: between Polycom and Avaya alone, the organization charts respectively are living organisms that seem to change from week to week, and we've also seen senior management changes at Lifesize. As to at least one major player adopting a sell direct strategy: AvayaLive Video, Avaya's VCaaS service, is being sold direct. The other direct approaches are not from the major vendors, but from some of the smaller VCaaS guys. And I predicted that a channel partner revolt would open an opportunity for China-based vendors in western and developing markets. I'm not sure it would qualify as a revolt, but dissatisfaction in the traditional video conferencing channels has definitely opened up opportunities and created success stories for some of the China-based vendors (seemingly everywhere except in North America) -- I claim prescience here. Finally, I predicted that WebRTC would still be insignificant at end of year. Hype around WebRTC far exceeds the reality. There are lots of technology / political glitches for one, and another is that when you think about it, most of the functionality has existed for quite a while.
Prediction: While perhaps not branded as WebRTC per se (and unconcerned with interoperability), the underlying WebRTC technologies will enable web conferencing players of all sizes to add high-quality, browser-based video conferencing to their offerings -- which will increasingly fuel their ability to give traditional video conferencing providers a run.
Recap: Nailed it. In mid-2014, top tier web conferencing provider Citrix rolled out GoToMeeting Free, a new freemium offering based on a different code base than GoToMeeting Pro, one which emphasizes video conferencing and *requires* a WebRTC-compatible browser. Other web conferencing players that stepped on the WebRTC gas pedal in 2014 include AnyMeeting and NetDev / DRUM.
Alan D. Greenberg
Prediction: VC incumbents will feel the heat. By this time next year the combined market share Cisco / Polycom hold specifically in K-12 and Higher Ed for video conferencing sales will be down 5%-10%. New or relatively newer players like Pexip, Acano, Zoom, Fuze, and Blue Jeans Network will gain further traction in all educational market segments. Interactive whiteboards will come back as a category "in favor" among the educational users we survey in our metrics reports. And look for web conferencing and lecture capture to continue to be hotspots, with the former hitting 90%+ penetration rates, the latter greater than 50% (in our surveys).
Recap: Almost got it. Almost all five of the relatively newer players for video conferencing in education touted loads of success stories in education markets. The bigger story here, however, one we could not have predicted at the time, has been what Google has done to bring video to the masses while integrating all of its Google Stuff (can I trademark that term?) together with video. Nor did I see the strides Microsoft Lync would begin to make in education, where the same PBX forklift replacements that happen in commercial markets are happening in educational enterprises. Meanwhile, interactive whiteboards per se have not come back in favor in education, but the concepts of whiteboarding and collaboration have made great strides. It just depends on what you are using for access and delivery points. Finally, I'm still fielding our Distance Education and e-Learning Survey, so can't yet report web conferencing and lecture capture penetration rates. But I hear from the vendor community that deployments are holding steady.
Prediction: The UCaaS space will see another round of consolidation, with at least three independent providers getting absorbed through M&A activity in 2014. There are a number of attractive, right-sized providers delivering various levels of the UCaaS stack who have proven their ability to grow over the last several years. Chinook Communications, SIPCOM, Applicable, NextPlane, and Thinking Phone Networks are just a few examples of smart UCaaS-related companies that have built solid brand and forward-looking business models and that could be prime for acquisition.
Recap: Nailed it. To be fair, I tossed myself a bit of a softball: of course the UCaaS space was prime for consolidation -- it didn't take a WR UC analyst to see that! The year 2014 saw a number of primed, high-profile UCaaS acquisitions, including Telepo, acquired by Mitel / Aastra, Implement.com / Chinook acquired by Arkadin (which then was summarily acquired by NTT), and Telesphere acquired by Vonage. These acquisitions speak volumes to the growing demand for UCaaS services -- whether you are a telco, telephony vendor, conferencing service provider, or other, having a hosted UC service offering is becoming table stakes in the UC&C service industry.
Steve Vonder Haar
Prediction: The year 2014 will be the year when hybrid solutions -- offerings combining elements of on-premise deployments and hosted software solutions in an integrated package -- will come of age in the streaming platform market. Vendor product upgrades will increasingly showcase hybrid capabilities, setting the stage for solutions that combine the security and reliability of on-premise with the expanded flexibility of hosted solutions. The hybrid wave also will foster accelerated partnering and product integration efforts between developers of solutions that target different segments of the streaming video workflow.
Recap: Nailed it. High-profile enterprise streaming technology vendor VBrick, for instance, introduced an entirely new platform -- called Rev -- that blurs the lines between on-premise and hosted deployments. Meanwhile, publicly traded Qumu engineered the acquisition of Kulu Valley with the intention of weaving Kulu Valley's hosted content creation capabilities with Qumu's content management platform that typically is deployed on-premise. And while some large enterprises may still chafe at the idea of employing hosted solutions for webcasting, anecdotally we notice that more end users are growing ambivalent over the "on-prem vs. cloud" debate. Their focus increasingly on finding a solution that works -- at the right price. "On-prem vs. Cloud" is no longer a religious debate. More and more, it's just another deployment detail.
Ira M. Weinstein
Prediction: During 2014 and 2015, we will see dramatic changes in the enterprise meeting rooms. More conference rooms will be video-enabled thanks to the availability of low cost, high performance video endpoints. AV deployments will become simpler, less expensive, and more powerful thanks to multi-function devices (e.g. Crestron's DMPS) and the expanded use of cloud services. Also, service providers will release hybrid offerings that leverage a combination of software-based, on-premise infrastructure systems and hosted systems. The result will be a fully outsourced video service that uses the customer network when possible and the provider's platform as required.
Recap: Almost got it! Nailed some, halfway there with some. Nailed it (100% accurate) on changes in enterprise meeting rooms, though this is just the beginning. Enterprises are turning their attention toward the smaller, non-AV / non-VC-enabled meeting rooms within their facilities (known widely at WR and elsewhere as huddle rooms). And lower cost solutions (e.g. Cisco's SX-10 and solutions from companies like Kedacom and Aver) are making it more cost-effective than ever to video-enable those smaller meeting rooms. Regarding AV deployments becoming simpler & less expensive: Halfway got it -- as predicted, meeting rooms are becoming simpler and less expensive, but much of this stems from the desire to standardize AV deployments. Organizations are deploying multi-function devices at a rapid pace, but the adoption of cloud services for these simpler meeting rooms has been a bit slower than expected. Finally, regarding service providers releasing hybrid offerings that leverage a combination of software-based, on premise infrastructure systems and hosted systems: Almost nailed it (75% accurate) -- as predicted, savvy providers are embracing and actively promoting hybrid deployment models to their customers. However, despite the availability of a wide range of powerful software-based solutions, most hybrid deployments involve hardware solutions on the customer premise and the provider's cloud-based service. While somewhat traditional in nature, this model is a good transitional step from an all-CPE solution at it allows enterprises to continue to leverage existing investments. The software side of this prediction, however, has been delayed due -- at least in part -- to the leading vendors' desire to protect their hardware revenue.
Prediction: The NSA in the U.S., the GCHQ in the UK, and China's MSS through a variety of agencies and organizations (can you spell Huawei?) have gotten nearly every commercial enterprise concerned about who's listening in. Audio conferencing providers switching from 6- to 10-digit PIN's hasn't made your conference call any more secure -- just more frustrating to get into (yes, I know it cuts down on fraud). Web and video conferencing is a bit more secure -- it is easier to encrypt an all-digital transmission. In 2014, it is likely that multiple collaboration service providers three levels of increasingly secure digital conferencing as a new service. Think in terms of multi-factor authentication where only one instance of an individual's credentials can be used at any one time on the network (no forwarding the meeting invite), and when you need to step it up one notch, 'double wrap it' with two forms of encryption, e.g., encrypted once with RC4-256, then again with AES-246 bit.
Recap: Missed it but who the heck knows the future? It is clear that most collaboration service providers (CSPs) don't have new services for security and multi-authentication (e.g. double wrapped forms of encryption or biometric authentication). A couple of thoughts here: a) it could be that everyone has resigned to the fact that the Brits, the Americans, and the Chinese will always be spying on everyone, so they should not talk about sensitive things online and have reverted to using payphones -- remember how people used payphones for covert conversations in the 1970's? (unlikely), b) it could be that CSPs did not find a way to monetize new security offerings and therefore did not create new services (likely) or, c) CSPs did introduce new security services, but it's a secret -- making the service all the more secure (most likely).
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