Collaboration software spending to hit $45bn as team chat app demand booms
More and more companies are rolling out software like Microsoft Teams and Slack, making the collaboration software market a booming business, according to Synergy Research Group
Spending on team chat applications is set to grow substantially this year as demand for collaboration and unified communications (UC) software continues to boom, according to a forecast from Synergy Research Group.
Quarterly revenues are now at an all-time high, according to the analyst firm, and are set to continue “growing steadily” for the next five years. Third-quarter revenue in 2018 almost topped $11 billion (€9.6 billion), with final quarter numbers expected to be “substantially higher.”
Overall, the market for collaboration software is set to grow 9% this year to more than $45 billion (€39.3 billion) globally, buoyed by several high-growth market areas.
Team chat apps
The biggest growth is forecast for spending on team collaboration apps such as Slack and Microsoft Teams; it’s expected to rise 60% compared to last year, with spending expected to reach $500 million (€437 million) during 2019. Other fast-growing market segments include Video as a service (VaaS) and Communication Platform as a Service (CPaaS). Both are set to see 30% growth.
Explaining the growing popularity of team chat apps, Jeremy Duke, founder and chief analyst at Synergy Research Group, said the tools gained early traction with tech-focused organisations and innovative start-ups that wanted alternatives to traditional UC offerings.
That adoption is now becoming more widespread across a variety of enterprises – and Microsoft last week made a play for greater influence in the education market.
“Our research shows market adoption has progressed … since the early days and what we are now seeing is adoption to larger organisations in Medium to Large Enterprises,” Duke said.
The result is a “hockey stick growth curve” for the market, he said. Not surprisingly, that caught the attention of established UC vendors who entered the market in the last few years following the success of Slack.
Slack, which is reportedly preparing for a direct stock exchange listing, has seen the most “noteworthy” growth, according to the firm, with revenues doubling in the past year. According to the company’s most recent adoption figures, Slack now has 8 million paid users. In 2017, Slack claimed approximately $200 (€175) in annual recurring revenues.
Among the other fast-growing vendors are Twilio, BroadCloud (Cisco), Zoom, Fuze, Dropbox, RingCentral and LogMeIn (Jive).
It is the large tech vendors that account for the bulk of the overall collaboration software market. Cisco, which sells a range of UC, collaboration and contact centre products, will retain its lead in overall revenue generation, having further outdistanced second-placed Microsoft in the last quarter.
A Synergy Research report from last year showed that Cisco now accounts for the largest share of the on-premise software market, although Microsoft has seen success with cloud and hosted collaboration apps.
Cloud collaboration gains converts
Synergy’s latest data also highlighted an ongoing shift away from on-premise collaboration software deployments; they’re predicted to decline 3% even as spending on cloud and hosted products increases 19%.
Revenues for cloud and hosted software now account for 64% of the total, with on-premises products making up the rest. That marks a clear shift from a year ago, when the two were roughly on par.
According to Duke, Synergy’s research indicates the on-premise market will continue to contract.
“We believe on-premise is primarily an installed base play,” he said. “We do not see large new sales of traditional UC being sold, most are being sold into a large installed base.”
He notes, however, that the UC installed base is “enormous,” so while revenues are not growing, there is a “sizable amount of revenue still being spent that will continue for years to come.”
source techcentral
Industry: Unified Communications News
Latest Jobs
-
- Security Auditor / 3rd Party Assurance. London. End user
- London
- 60000
-
Security Auditor / 3rd Party Assurance. London. End user The Security Auditor / 3rd Party Assurance role has two key functions. Manage the ongoing assessment of new and existing 3rd party suppliers to ensure they meet the internal policies / controls. (Reassessment etc) Internal Auditing across business to ensure various departemnt / operations are compliant and inline with internal ISMS etc. ISO 27001 internal audit experience, creation of audit reports experinece essential. This is an internal business so broad experience across a multiple technology environment (cloud and on prem) is highly desirable. MUST be able to engage and work with senior stakeholders in an often faced pace environment. ISO27001, NIST, CISSP, CISA Risk assessment experinece needed This is a permanent role.. Blend of technical and consultative approach needed. This role will require someone to travel to London a few days a week once lock down permits and their offices fully reopen. All details kept in confidence. Apply today to find out more.
-
- Security Auditor / 3rd Party Assurance. London. End user
- London
- 60000
-
Security Auditor / 3rd Party Assurance. London. End user The Security Auditor / 3rd Party Assurance role has two key functions. Manage the ongoing assessment of new and existing 3rd party suppliers to ensure they meet the internal policies / controls. (Reassessment etc) Internal Auditing across business to ensure various departemnt / operations are compliant and inline with internal ISMS etc. ISO 27001 internal audit experience, creation of audit reports experinece essential. This is an internal business so broad experience across a multiple technology environment (cloud and on prem) is highly desirable. MUST be able to engage and work with senior stakeholders in an often faced pace environment. ISO27001, NIST, CISSP, CISA Risk assessment experinece needed This is a permanent role.. Blend of technical and consultative approach needed. This role will require someone to travel to London a few days a week once lock down permits and their offices fully reopen. All details kept in confidence. Apply today to find out more.
-
- Head of Penetration Testing, UK based, Flexible location.
- United Kingdom
- Upto £100,000 plus excellent benefits
-
Head of Penetration Testing needed to join a security consultancy that are delivering client facing penetration testing services around Web app and Infrastructure. Looking for someone hands on that is able to manage a highly skilled technical team of testers. 50-60% of the time is expected to be hands on, other duties will include, but not be limited to; leading and managing the day to day running of the team, mentoring, team upskill, recruitment, reporting, escalation, process improvement etc. Flexible location although south east is preferred. Anyone with Check / CREST experience is highly desirable. MUST be able to achieve SC clearance. UK based role. All details kept in confidence.
-
- Technical Security Analyst. Immediate opportunity,
- Newcastle upon Tyne
- 48000
-
Technical Security Analyst. Immediate opportunity, Technical Security Analyst needed to join a specialist security team. This role will require travel into the office in a hybrid model once industry returns back to the working environment. The Security Analyst must be commutable to Newcastle upon Tyne. This is an Immediate opportunity. An essential requirement of the role is to be able to engage with internal stakeholders so a blend off technical hands on analytical and consultative communication skills. The role will include, but not be limited to; managing and handling incidents end to end, log review, incident analysis, escalation, vulnerability assessment, Automation, Malware Analysis, Threat intelligence, etc All details kept in confidence. https://calendly.com/chris-holt/call-with-chris-holt-dcl-search