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The UK videoconferencing market was worth
£90m in 1997, an increase of 25 percent from 1996. Volume sales rose much
faster, by 111.5 percent. 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 percent 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.
Text © 1998 Key Note
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Last updated by Duncan Nottage 5th March 1999