Video conferencing equipment revenue in the fourth quarter fell 8.6 percent from a year ago to $739.8 million and sales for 2012 fell 2.6 percent, according to research firm IDC.
The biggest reasons for the declines were immersive telepresence systems revenue, which fell 32.8 percent in 2012. Video networking infrastructure sales also fell 4.5 percent in 2012. Meanwhile, room-based video conferencing and personal systems saw sales jump 4.1 percent and 5 percent in 2012, respectively.
What's going on? In short, free and low-priced video conferencing systems are good enough for most people. Do you need a big telepresence system or will Google Hangouts, Skype and Apple's Facetime do? If you need something more you can also get a lot of features from many players without the immersive telepresence price tag.
IDC's official reasons for the video conferencing malaise were the economy and cutbacks in the public sector, education and government verticals. Those reasons make sense, but the reality is there are plenty of good enough systems and that's hurting high-end sales.
Among the notable points:
- 2012 video conferencing revenue was $2.64 billion, down 2.6 percent from a year ago.
- Cisco's fourth quarter market share was 44.8 percent, up from 43.3 percent in the third quarter.
- Polycom's fourth quarter market share was 23 percent, down from 25 percent in the third quarter.
- Latin America and Asia Pacific delivered regional video conferencing sales of 8.8 percent and 10.4 percent in the fourth quarter, respectively.
- EMEA and North America video conferencing sales fell 5.9 percent and 22.9 percent, respectively.