Video conferencing, telepresence sales tank

Software and cloud-based video collaboration tools have opened up a big can of whoop ass on hardware-based video conferencing systems.

These telepresence systems just don't sell like they used to. Image: Cisco

So much for all that video conferencing and telepresence as a collaboration panacea.

According to IDC, sales of video conferencing equipment in the first quarter fell 15.9 percent compared to a year ago. Global enterprise video equipment revenue in the first quarter was $473.5 million and units sold fell 6.2 percent from a year ago.

IDC called the results "dismal," but noted video is "a key component of collaboration." The issue with the first quarter video conferencing system sales is that the market is transitioning from hardware-focused approaches to software and cloud only.

Among the key data points:

  • Immersive telepresence equipment revenue fell 33.5 percent in the first quarter compared to a year ago. 

  • Room video systems fell 10.1 percent in the first quarter compared to a year ago. 

  • Latin America had the smallest decline in first quarter, falling 5.1 percent compared to a year ago. Other regions all had double-digit declines.

  • Cisco has the most market share in the space with 40.1 percent followed by Polycom at 28.9 percent and Huawei at 7.8 percent. All of those leaders had year-over-year declines with Cisco taking the biggest hit.

IDC analyst Rich Costello noted:

"We continue to see the impact of delayed customer buying decisions, lower-cost systems, more software-centric products, and competitive cloud-based video service offerings on the worldwide enterprise video equipment market."

In other words, hardware-based video collaboration systems will continue to stumble in the quarters ahead.