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Frost & Sullivan: Cisco And Microsoft Dominate A Two-tiered UC Market In Australia

SYDNEY, Oct. 14, 2013 /PRNewswire/ -- The Australian on-premise Unified Communications (UC) market was worth $698.5 million in 2012. This moderate growth of 2.4% from the previous year was mainly due to cautious spending from businesses as the market reacted to uncertainties in Government policies and the federal election. As organisations opt to wait and assess the suitability of cloud based solutions, growth in the on-premise UC market will continue to be low. The overall UC market in Australia is expected to grow at a CAGR of 5.5% from 2012 to 2019. Changes in business attitudes towards capital intensive UC deployments are driving interest in hosted and cloud based solutions. As organisations find it harder to secure funds to invest in expensive UC infrastructure, it is lengthening the decision making process and thereby the overall sales cycle. 

Frost & Sullivan's new research, Australian Unified Communications (UC) Market 2013, finds there are a number of disruptive factors emerging in the Australian UC market that have the potential to impact the traditional business model. The main factors include the growing significance of Microsoft Lync, the emergence of Over-The-Top (OTT) and cloud based vendors, the emergence of Google as an enterprise vendor and the potential of WebRTC.

Audrey William, Head of Research, ICT Practice, Frost & Sullivan ANZ says, "these factors are impacting the market to varying degrees, but when combined with cloud based solutions, have the potential to significantly change the UC market and threaten the dominance of existing vendors". Among the disruptive factors discussed, Microsoft's Lync platform is the closest to becoming mainstream and reaching widespread adoption. One of the important factors that has driven greater interest in Lync is its improved ability to serve as a PBX. Recent updates to Lync have closed the gap in functionality terms between traditional PBX systems and Lync PBX. In addition, Microsoft has also been aggressively engaging in marketing and education activities to improve market perceptions and trust in Lync.

Cloud based UC solution is the other major factor that will change traditional UC environment. Cloud based video in particular, is emerging as the segment with the potential to trigger a major shift away from on-premise solutions. Although several video conferencing vendors promote the interoperability features of their endpoints, the lack of an industry wide agreement still limits overall success. Cloud based video conferencing vendors are entering the market with the ability to by-pass interoperability and maintenance complexities. Cloud based video conferencing solutions enable organisations to avoid expensive and maintenance intensive backend infrastructures. The back-end processing (MCUs and gateways) is hosted by the provider from its own data centres or partner networks, requiring only endpoints (screens and cameras) from the customer.

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