How Cloud is Changing the Video Conferencing Equation: Act Now to Gain a Competitive Advantage A Frost & Sullivan Market Insight Sponsored by Lifesize

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1 How Cloud is Changing the Video Conferencing Equation: Act Now to Gain a Competitive Advantage A Frost & Sullivan Market Insight Sponsored by Lifesize

2 frost.com Introduction... 3 Top Collaboration Trends that are Shaping Video Conferencing Adoption... 3 Cloud Video Conferencing Adds Value... 5 What to Look for in a Cloud Video Conferencing Service... 6 Conclusion... 7 CONTENTS

3 How Cloud is Changing the Video Conferencing Equation: Act Now to Gain a Competitive Advantage INTRODUCTION Digital transformation is all around us. Businesses are changing the way they use technology to radically improve their performance and reach. Technology advances such as cloud computing, analytics, mobility, and social media are disrupting old business models and redefining the modern workplace. Business leaders who are ready for digital transformation are rapidly adopting leading-edge collaboration tools that not only streamline business processes, but also bring together various teams for agile cross-functional collaboration. Video conferencing has become a vital communications tool today for companies that seek greater productivity and sustained competitive advantage at reduced operating costs. At the same time, the old hardware-centric approach to end-to-end video conferencing infrastructure is out. In fact, cloud-based video conferencing ushered in such a profound evolution, those enterprises that rely on premise-based deployments are not realizing the full benefits of the technology. Specifically, they face the insurmountable challenges of high up-front capital investment and operating costs, operational challenges, constrained IT resources and budgets, interoperability, and long deployment times. Cloud-based video conferencing is changing all of that. Moreover, it levels the playing field so companies of all sizes, not just the ones with deep pockets, can roll out video conferencing for all employees at low costs with zero operational headaches. TOP COLLABORATION TRENDS THAT ARE SHAPING VIDEO CONFERENCING ADOPTION User demand for video and Web collaboration is growing at a staggering pace. However, to get the most from a collaboration solution, organizations need these tools to be fully adopted and utilized. The journey to successful end-user acceptance hinges upon one critical factor the user experience. Cloud services are easy to use and reliable which essentially resolves all issues with the old video scenario to deliver increased productivity as well as lower total cost of ownership (TCO). There are several collaboration trends that are transforming the user experience and providing an impetus to video conferencing adoption: is Dying Frequent, instant ad-hoc collaboration is replacing s. Instead of lengthy back-andforth discussions, video conferencing offers the ability to have productive instant communications; it s all about getting the work done faster and better. The Millennial Impact Millennials, whose behaviors are driven by a deep affinity for digitization, are joining the workforce in droves. This FaceTime and Snap Chat generation expects consumer-like ease of use and more effective technologies at work, which has helped create a whole new category of collaboration products with the spotlight on video. All rights reserved 2015 Frost & Sullivan 3

4 How Cloud is Changing the Video Conferencing Equation: Act Now to Gain a Competitive Advantage Exhibit 1: Collaboration in an Era of Digital Transformation Emerging User Trends is Dying - Users want latest collaboration tools Millennials Seek Better Work/Life Balance Persistent Collaboration User-driven Collaboration Mobile Workstyles User-driven Collaboration Employees are focused on results. To help reach their goals, they are adopting ad-hoc collaboration tools, like video conferencing, which connect them instantly from their desktops and mobile devices. Gone are the days of long technology deployment cycles and the need for IT intervention to run video meetings. Consumerization and the self-service nature of today s collaboration options have empowered users to bring their choice of applications into the workplace. Persistent Collaboration Meetings are becoming more than one and done events. The notion that meetings have an entire lifecycle (pre-, in-, and post-meeting) requires continuity of collaboration. Moreover, online meetings are moving from scheduled, pre-planned sessions to instant, real-time conversations that are more personal and targeted. The new generation of video conferencing services offers always-on persistent virtual spaces where users can meet anytime and collaborate, as well as store all their content and relevant information. Mobile Workstyles The mantra work is not a place you go to; it is what you get done is well established. Bring Your Own App (BYOA), driven by mobility and consumerization, is redefining the modern workplace. Employees expect all their corporate applications to be easily accessible on their mobile devices. Cloud video conferencing enables seamless mobile connectivity for globally distributed organizations, regardless of location or network. As a result of these transformational shifts, video and Web collaboration have become key business enablers. The emergence of easy-to-use, reliable, low-priced and robust cloud services that offer converged audio, video and Web collaboration deliver a compelling value, quickly connecting and engaging employees, customers, and partners, without taxing IT departments and budgets. 4 All rights reserved 2015 Frost & Sullivan

5 How Cloud is Changing the Video Conferencing Equation: Act Now to Gain a Competitive Advantage A recent Frost & Sullivan survey of C-level executives found that 58% of the companies use video conferencing for their daily business operations, up from 41% just three years ago. Exhibit 2: Conferencing Services Lead Among the Enterprise Communication Applications Moving to Cloud WITHIN THE NEXT THREE YEARS, THE FOLLOWING SOLUTIONS WILL MOVE TO THE CLOUD 82% 74% 67% 66% 65% Conferencing Instant messaging/chat Enterprise social networking Telephony n=380 Source: 2014 Frost & Sullivan survey of North American IT decision makers CLOUD VIDEO CONFERENCING ADDS VALUE Businesses have a lot of reasons to implement video conferencing in the public cloud. The chief drivers include both short-term tactical objectives and longer-term strategic goals. The tactical drivers such as shift to OPEX and reduced management burden address the growing needs of resource-constrained IT managers. The strategic drivers such as increased agility and supporting changing business needs reflect the topof-mind concerns for business leaders focused on transformation. All rights reserved 2015 Frost & Sullivan 5

6 How Cloud is Changing the Video Conferencing Equation: Act Now to Gain a Competitive Advantage For users, the benefits are instant as the service is up and running in no time. Deployments today happen in hours and days, whereas just a few years ago they took months. Old-World Video Conferencing Technology Island Large upfront CapEx High total cost of ownership Complex management/administration Fixed capacity; not scalable Limited user access Limited interoperability Frequent and expensive upgrades Extensive deployment and implementation time Cloud Allows Anytime, anywhere connectivity OpEx-based flexible subscription pricing Affordable video conferencing for all No IT involvement, yet robust admin control Scales up or down to accommodate changing user needs Ubiquitous access over varied devices and clients Full interoperability for B2B and B2C communications Instant upgrades at no additional cost Speedy deployment; instant ROI WHAT TO LOOK FOR IN A CLOUD VIDEO CONFERENCING SERVICE There are a plethora of options available today for cloud-based video collaboration. This is leading to greater scrutiny of service quality and reliability. The four pillars for success of cloud-based video conferencing implementation are reliability, quality, cost efficiency, and user experience. Several services available today offer excellent Web collaboration and content sharing, but fail on delivering high-quality multiparty video communications. Others offer good audio and video collaboration, but do not scale up to offer enterprise-grade features, such as recording and content management. All cloud video conferencing services are not created equal. Customers must ensure that they select a provider that offers them the full range of benefits: Simplicity Simplicity is key. Employees will keep coming back to tools that are user friendly and intuitive to use. Ease of Access Ability to connect from any device and application room endpoints, desktops, mobile phones, browsers via rich Web-based app ensures flexible communications. Moreover, the extension of this consistent collaboration experience into meeting rooms of all sizes ensures a connected device experience. Unified Services Next-generation collaboration delivers converged audio, video and Web conferencing, making it easier to consolidate the collaboration spend on a single platform and a unified UI. A unified service cuts back on the inefficiencies of dealing with multiple apps, and reduces user frustration and IT inefficiencies. Quality of Service Consistent, high-quality and reliable performance truly encourages user adoption. Moreover, robust capabilities such as persistent collaboration and rich recording and sharing make today s cloud video conferencing solutions a one-stop shop for all collaboration needs. Interoperability Employees want any-to-any connectivity with their choice of applications, such as Skype for Business, and existing workflows, such as Google Calendar and Outlook. 6 All rights reserved 2015 Frost & Sullivan

7 How Cloud is Changing the Video Conferencing Equation: Act Now to Gain a Competitive Advantage Security IT must ensure that they select a provider that treats security holistically to address all aspects, including end-to-end encryption, authentication, password protection, secure Firewall/NAT Traversal access, and data center security. Cost Savings The next generation of cloud video conferencing services not only offers the flexibility of a pay-as-you-consume model, but is also available at extremely low costs. Frost & Sullivan research indicates that businesses can save anywhere from 60 to 75% in annual costs by moving from an on-premises deployment to a cloud video conferencing service. Ease of Management Cloud services are easy to deploy and simple to manage and maintain, as they offer automated upgrades at no additional costs. This self-service/self-improvement approach reduces IT s involvement significantly. As a result, IT is unburdened and can become a strategic asset for the organization, focused on optimizing and improving the business. Exhibit 3 Cloud Video Conferencing Flips the Equation Old World Video Conferencing Focus on Business IT Heavy Lifting and Management Cloud Video Conferencing More Time to Focus on Business Strategy IT Involvement CONCLUSION Businesses are moving to the cloud at a staggering pace. Cloud conferencing changes the total cost of ownership and offers unprecedented business agility compared to traditional on-premises deployments. A new set of disruptive cloud video conferencing services is evolving to serve employees with simpler, more reliable, and low-cost solutions, allowing a whole new population of users to access the technology. Forward-thinking business users and IT decision makers are embracing the new generation of converged video, Web, and audio conferencing services in the cloud to gain a competitive edge and business agility. All rights reserved 2015 Frost & Sullivan 7

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