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January 14, 2011

UC market to double by 2014: IDC

Shift will be towards hosted UC, while legacy vendors will hit the M&A road

By Steve Evans

The EMEA market for unified communications (UC) is set to double by 2014, according to new figures from analyst house IDC.

The firm reckons that the market, currently worth $8bn, will hit $16.6bn within three years. That may sound impressive, but Isabel Montero, senior research analyst, unified communications and collaboration, IDC EMEA, said the growth is "moderate" and will remain so beyond that three year period. She also warned that the credit crunch will continue to affect the market.

"IDC predicts moderate year-over-year growth in the next five years and believes that the impact of the credit crunch across the EMEA region will continue to make enterprises more cautious when deciding whether or not to invest in new IT equipment," Montero said.

"Budgets in this region will continue to be more closely monitored, restricted, or delayed until recovery in the economy is more notable," Montero added.

IDC also reckons hosted UC will become more popular, particularly with SMBs looking to rid themselves of the cost of a communications infrastructure by outsourcing it. Montero said that this shift towards cloud-based UC may cause panic at the traditional UC vendors, and as a result IDC expects to see more mergers and acquisitions in this space.

Alex Donnelly, portfolio manager at Damovo UK, said that the news from IDC suggests there will be a move away from an all-in-one package and a "true" UC will emerge:

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"This report from IDC is good news for the industry as a whole as it shows that irrespective of the economic climate, adoption is increasing. What is apparent is that there has been a shift away from organisations looking to deploy ‘all singing, all dancing’ end-to-end solutions and instead many are taking a more piecemeal approach. True unified communications will bring together multi-model means of communicating from different vendors whether it be a BlackBerry, Cisco, Microsoft, web browser or iPhone environment," he said.

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