Big demand for web conferencing

By Amit Roy Choudhury Hosted web conferencing services are being increasingly adopted by companies in AsiaPacific with revenues this year expected to grow by an estimated 38.8 per cent to reach US$35.2 million, according to a new study. Australia, Japan and Greater China are the top three revenue contributors. According to Frost & Sullivan, who conducted the study, the hosted Web conferencing services market, covering six sub-regions (13 countries in total), last year generated US$25.3 million of revenue, growing by 37.6 per cent.

Speaking to BizIT, Pranabesh Nath, Frost's industry analyst, said the market will reach US$237.4 million by end-2014, with the compound annual growth rate of 37.7 per cent. This growth momentum is expected to continue for the next six years with a similar high yearly growth average forecasted till 2014, according to the research agency. The high-technology and BFSI (banking, financial services and insurance) sectors are expected to continue to be the main adopters. According to Frost's definition, hosted Web conferencing services include those offered by service providers on a SaaS (Software as a Service) model for a payas-you-use fee (cost per user, per minute) or fixed fee (cost per seat), as well as managed conferencing services. On-site or premised-based conferencing solutions are excluded from this study. Mr Nath noted that the Singapore market is the single largest revenue contributor to the Asean region: 'Singapore accounts for the bulk of the revenues owing to its position as a key business hub for Asean, and a major financial base for the region.' He added that Singapore is expected to remain the leading revenue generator in the region, although at a slightly lower percentage share by 2014 as other Asean countries like Malaysia see increasing demand. Mr Nath said that growth in the Singapore market last year was led by key global players and service providers like WebEx, Genesys and Premiere Global. A majority of the usage was for Web conferencing with other regional and international users, given the size of the country. 'Future growth of this sector in Singapore will be sustained by the country's position as a major regional hub, the continued adoption of Web conferencing services by the BFSI

industry, which is currently the largest user, and the push by the global web conferencing service providers.' Mr Nath added that the market in Singapore is likely to continue to be dominated by pureplay service providers, as the local telcos are not aggressively promoting this service. The Frost analyst noted that the huge demand in Web conferencing services is driven mainly by growing uptake in the small and medium-sized business (SMB) sector in both emerging and mature markets, as well as the push by major local service providers in countries such as Japan and China. 'Service providers in China particularly have seen rapid growth with a record number of new users added each year. The number of hosted Web conferencing service providers in China is also rising each year in tandem with the growing demand,' he added. According to Mr Nath, government efforts to promote the use of the Internet and the increasing use of Web-enabled technologies are also fuelling the growth of Web conferencing services. Some of the more common uses of Web conferencing solutions to date have been for applications such as general meetings, sales and marketing, and training purposes. 'Hosted Web conferencing services are also popular for specialised applications such as investor relations and Web-seminars or 'webinars', enabling businesses to communicate with audiences beyond the company's firewall,' he said. Mr Nath added that as the Web conferencing market matures, webinars are expected to gain popularity given the substantial savings in set-up costs, and the ability to join a webinar from anywhere in the world. VoIP (voice over Internet Protocol) audio integration with Web conferencing is expected to drive wider adoption. The Frost analyst noted that service providers who are able to bundle audio, video and Web conferencing services are better positioned to capitalise on the broader enterprise collaboration market. This article was first published in The Business Times on September 11, 2008