Desktop Videoconferencing Shipments to Hit 2.1 Million by 2003, IDC Says

FRAMINGHAM, Mass., August 23, 1999 – Serious inroads are being made in the worldwide videoconferencing market as desktop and compact videoconferencing shipments are projected to climb steadily from 398,000 end points in 1999 to 2.1 million by 2003. According to new research from International Data Corporation (IDC), the evolution from $70,000 room-based videoconferencing dinosaurs to today's sleek, streamlined desktop, set-top, and compact videoconferencing solutions makes this technology more appealing and attainable to a wider range of users.

IDC sees significant videoconferencing opportunity in both the consumer and business sectors. Key standards (H.320, H.323, and T.120) and technologies (e.g., video/audio codecs, MCUs, cameras, and multimedia-rich PCs) have made it possible for select commercial products to deliver truly real-time "TV quality" video at 30 frames per second. "Given adequate software, CPU power, and transmission support, videoconferencing can now offer its users smooth, high-quality images that make for a much more convincing interactive experience," said Bob O'Donnell, research manager, for IDC's PC Display and Multimedia Technologies program.

In the consumer segment, most videoconferencing kits have dropped in price by as much as 40% during the last 18 months and entry-level price points are now down near impulse ($79 to $159) price ranges. As a result of cheaper and easier-to-use offerings and heightened awareness of fun consumer applications, 964,000 consumer PC cameras were shipped worldwide in 1998, according to IDC's Digital Camera and Scanner Research program estimates. "Although consumer videoconferencing conditions continue to improve, the use of such devices has been limited due to barriers including the lack of available consumer bandwidth," O'Donnell said.

Key Findings

· The average sales price of worldwide commercial desktop videoconferencing is expected to drop to $850 by 2003. The consumer segment is expected to drop to $150 in the same time frame.

· Collective desktop videoconferencing and compact videoconferencing revenue increased 35% to $511 million in 1998.

· The DVC and compact videoconferencing systems installed base will increase from 622,000 cumulative end points in 1998 to more than 4.2 million end points by 2003.

· USB and 1394/Firewire connections are emerging and are simplifying setup and reducing expenses associated with DVC and Compact Videoconferencing.

· Traditional ISDN system end-point units declined about 12% to 93,600 units in 1998.

The primary research for IDC's The Evolving Videoconferencing Markets: Desktop, Set-Top, and Compact VC in Focus (IDC #B19785) consisted of interviewing senior management of key vendors (typically product-line managers, presidents, or vice president of marketing) during the spring of 1999. To order a copy of the report, contact Sue Beauregard at 508-935-4774 or sbeauregard@idc.com.

About IDC

International Data Corporation delivers accurate, relevant, and high-impact data and insight on information technology to help organizations make sound business and technology decisions. IDC forecasts worldwide IT markets and adoption and technology trends, and analyzes IT products and vendors, using a combination of rigorous primary research and in-depth competitive analysis. IDC is committed to providing global research with local content through more than 500 analysts in more than 40 countries worldwide. IDC's customers comprise the world's leading IT suppliers, IT organizations, and the financial community. Additional information on IDC can be found on its Web site at http://www.idc.com.

IDC is a division of International Data Group, the world's leading IT media, research, and exposition company.

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