Summary:

If you are a real-time collaboration (RTC) vendor, selling audio, video, or data conferencing technologies or are an RTC reseller, you are probably aware of the profound changes that have occurred in this market place over the last two years. These changes have been so profound that we see the RTC market in a state of transition - so much so that, a few years from now, an RTC vendor might not look anything like they do today! Today, the RTC environment is composed of meetings, which take place virtually, and are often scheduled in advance, and ad-hoc or presence-based IM interactions, which are often short and not persistent. CS sees the market rapidly evolving to an "on-demand" collaboration market, where the integration between different types of RTC functions is fluid and can be accessed from any device at anytime. What it takes to have changes like this occur over a short period of time is the confluence of a number of trends, which CS has been tracking for the last few years. They are converging (like a "perfect storm") to change the RTC market to such a degree that it will not be recognizable as the same market by the end of the decade. These nine trends include: 1. The convergence of audio/video/data conferencin 2. Presence (and status) everywhere! 3. Enterprise collaboration convergence and standardization 4. Pushing collaboration into the infrastructure 5. RTC market consolidation 6. Driving collaboration into industries and processes 7. Changing distribution channels 8. Changing buyers for collaboration solutions 9. The rise of mobile collaboration (PDA/cell phone as a platform for collaboration) First, the market for RTC has increased rapidly to a bit over $13 billion, with the predominant portion (over $8 billion) coming from audio conferencing and the rapidly growing voice over Internet protocol (VoIP) market. Next is presence as a core capability, and this is a trend that Microsoft is driving down into the operating system (OS). Other vendors, i.e., Oracle and IBM, are looking at making presence available to their whole suite of applications. Presence is often associated with instant messaging (IM), which gets some of its value from the network effect, and is currently hampered by lack of standards and interoperability between major consumer IM vendors and enterprise IM (EIM). However, recent agreements between Microsoft and Yahoo, and an impending purchase of AOL from TimeWarner may help to rapidly resolve this problem. CS sees the extension of presence into aspects of identity and attention as a strong possibility over the next few years. Thirdly, CS has tracked was consolidation and standardization of collaborative applications within the enterprise. In many cases, consolidation of these applications down to one or two known vendors (Microsoft, Oracle, IBM/Lotus) is often the outcome. CS has also seen a pattern in the way organizations adopt RTC technologies, first using them as a service for proof of concept, and then (depending on the size of the organization) moving the functionality behind the firewall. The fourth trend is both the collapse of siloed collaboration applications and the push of some RTC features into the infrastructure layers. Microsoft is a major force in pushing presence (and status) functions into the OS (Windows Vista). Next is the rapid consolidation of the RTC market. Although this market has had healthy growth over the last five years, and is projected to grow strongly until the end of the decade, not a month goes by that a major RTC player has not made an acquisition. From eBay's acquisition of Skype to WebEx's acquisition of Intranets.com, this market consolidation is helping to bring together synchronous and asynchronous collaboration features in one application suite to help support the evolution to "on-demand" collaboration. Trend six looks at some of the outcomes from RTC market maturation and consolidation. It is CS' belief that by 2008 there will only be a few major players selling horizontal collaborative solutions and the hundreds of other vendors in this space will either have been acquired or will find specific niches in vertical markets or within specific critical business processes that they will be able to defend. Another outcome of the RTC market maturation and consolidation is radical changes in distribution channels (trend seven). As the RTC market matures, more revenue flows through channels, and since 2003 that channel revenue has grown 22%. However, the biggest shake-up is in the traditional telecom market as RTC vendors with VoIP or hybrid PSTN-VoIP solutions continue to take away revenue from traditional telcos. The eighth trend is a change in both the profile of those buying collaborative solutions and in the way these solutions need to be sold. Pragmatic buyers from the line of business (LOB) are looking for risk-free solutions to their specific problems rather than collaborative features and functions. The ninth and final trend CS has tracked is mobility. As RTC technologies advance, the hardware that supports them becomes more powerful, and the software becomes more sophisticated, CS is seeing a move towards "human-centric" computing. In this trend, hardware and software limitations are removed so the user no longer has to adapt their behavior to accommodate for these limitations. RTC applications can begin to support people working in more natural ways, one of which is mobile work. Unfortunately, the mobile infrastructure in the U.S. is far behind Asia and Europe, and is the current limiting factor for mobile rich media interactions. Based on these nine trends, CS sees the scheduled, siloed, fragmented RTC market of today in a state of flux. Over the next two years, CS expects the RTC market to disappear - RTC functions will not disappear, but it will look very different. In the world of "on-demand collaboration", we will see human-centric, fluid, rich media interactions occurring anywhere, anytime, and with anyone!