The communication and collaboration market is clearly and indisputably seeing heightened interest and demand during the COVID-19 pandemic. The lingering impacts of these unprecedented times are expected to accelerate adoption of newer technologies like Extended Reality (XR) and increase growth rates of more established markets like video conferencing hardware, which is forecasted to approach US$4 billion by 2025, up from US$2.4 billion in 2019.
While no one knows for sure how much the COVID-19 pandemic will impact us, there is strong evidence to support there will be long-lasting effects. Some companies, like Facebook, have already amended work from home policies that extend beyond the current pandemic and provide early glimpses into what a new normal might look like in the workplace. The communications market, much like streaming media, already saw a shift toward supporting a wider breadth of devices, services, and environments – trends accelerated by the pandemic. The cancellation of events and inability to meet in person has driven demand for video calling services and tools and is opening new doors and exposure to more immersive solutions like XR.
What is XR?
In contrast to the video conferencing hardware market, where companies such as industry leader Cisco, and Logitech, take advantage of the shifting landscape, the XR collaboration space is far more nascent and diverse. XR, or extended reality, are technologies that encompass a breadth of applications. A wide array of companies are approaching the market from different angles and while industries like Architecture, Engineering & Construction (AEC) and manufacturing have emerged as early adopters, the market is still undergoing significant development.
Rising Opportunities for Video Conferencing Hardware
Video calling during this time has increased significantly, and while many have expressed a strong desire to get back to in-person meetings, such as conferences, companies will take a more cautious approach to these types of gatherings, which will engender further opportunities for collaboration and communication tools and services. Even before the pandemic, the video conferencing market was moving to support a more diversified user base that needs to accommodate a wider array of devices (e.g., mobile) and environments. This has created more opportunities for medium-sized/huddle rooms where meetings and collaboration sessions are more likely to occur extemporaneously and may need to support participants on a variety of devices and environments/locations.
The pandemic further emphasized the need to support individual spaces and smaller offices and these types of devices (e.g., webcams, laptops, and desktop units). As the world economies return to a semblance of normalcy, strong growth is anticipated for meeting rooms (in offices) to support a workforce that will continue to be split between in-office and home/remote meetings.
School closures have also generated heightened interest in immersive collaboration tools; for example, creating virtual teaching sessions. The spread and increased use of video calling/hardware will create new opportunities and interest in immersive alternatives, especially those that integrate and support more traditional video services.
Overall, the video conferencing hardware market is forecasted to grow at an 8.7% Compound Annual Growth Rate (CAGR) (from 2019 to 2025), reaching US$3.9 billion, while the immersive collaboration segment will command a much higher CAGR (82.2%) over the same period, but naturally beginning at a considerably smaller base to pass 413 million by 2025.
These findings are from ABI Research’s Video Conferencing Hardware and Immersive Collaboration application analysis report. This report is part of the company’s Video and Cloud Services research service, which includes research, data, and analyst Insights.