Audio Visual Conference Systems: Japan VS Global
As the decreasing birthrate and aging population issues persist in Japan, a work-style reform bill was enacted in June this year and will be enforced from April 2019. The law intends to create work environments where workers have greater flexibility and can accommodate for childcare or nursing care. To make this a reality, the improvement of productivity through investment and innovation is indispensable, Ministry of Health, Labour and Welfare states.
Technology has supported shifting work styles over the years, and the videoconference system is just one type of technology that is being increasingly utilized in companies to reduce transportation expenses and increase productivity. In Japan, we tend to prefer face-to-face meetings and the traditional business culture has remained unchanged for a long time, but what is the current state in an increasingly technology driven world? I would like to examine the video conference system Japanese market versus the global market, referring to various reports from research agencies.
First, let’s examine the results of a survey conducted by the Japan Institute for Labor Policy and Training, published in July 2017 (2,500 companies and 12,000 employees were targeted). In the “Research on innovation measures in enterprises” (*1) report, 46.8% of companies answered that they “have implemented video conference systems (including web conferences and audio conferences, etc.)”. The top three responses for the purpose of the videoconference system are “meetings between head office, branch office, sales office, etc.,” “regular or irregular meetings” and “meetings among employees”. For the impact, 82.3% answered that “reduction and improvement in efficiency of traveling time,” followed by “reduction of travel expenses”, “reduction in the number of business trips”, “improvement in efficiency and productivity of operations” and “reduction of meeting times and improving efficiency.”
The result that nearly half of Japanese companies are using some type of remote conference system was more than I expected. In addition, 80% responded that they were able to reduce traveling time, and that indicates that majority of the companies are actually using the system effectively and realize it is a beneficial tool.
Next, let’s look at market size. Seed Planning Inc., a Japanese market research company, last year released the “Forecast of Video Communication Market” (*2) report. The domestic videoconferencing market (including video conference, web conference and audio conference) is forecasted at 50.6 billion yen in 2018. The number has steadily increased from 35 billion yen in 2011, the oldest recorded data in the report, meaning a 102% increase from 2017.
For the system type, video conferencing and web conferencing are approximately the same percentage and amount to 50% in total. For video conferencing systems, Cisco is the market leader, followed by Polycom in terms of both volume and sales.
For the global market, Frost & Sullivan in 2018 released the “Global Video Conferencing Market Research Report” (*3) , which shows that the market size will expand from 42.6 billion dollars in 2016 to 59.6 billion dollars in 2020 . Compared to a CARG of 7.5% from 2012 to 2016, the market will have a more rapid growth between 2017 and 2021, with a CARG of 8.3%. Globalization, improvement in technology, and downstream needs are listed as factors for the market growth. Market leaders are classified in three categories as “Leader”, “Specialist” and “Challenger”, and the top two leaders are Cisco and Huawei.
There is also a survey focused on “telepresence”, which is often referred to as “evolved video conference system” or “immersive”. Telepresence is a set of technologies, which allow a person to feel as if they are in the same room as the person they are having a video conference call with. It is often equipped with state of the art technology, such as ultra-high definition video and the highest audio quality. According to the “Telepresence Equipment Market Size, Industry Report, 2018-2025” ( * 4) conducted by Grand View Research, the telepresence market in 2016 was estimated to be over $1.8 billion and is expected to grow to $2.5 billion by 2025. The reduction of travel costs is the primary factor driving market growth, while the high cost of installation is one the major restraints for growth, the report states.
Leo Yeung (Project Manager / Senior AV Consultant in our Tokyo office) gave some insight into these trends.
“For our global, multinational clients, “premium-class” conference systems are still popular and we currently have several projects under progress. I can see high motivation towards aggressive investment for the 2020 Tokyo Olympics.
AV equipment required for large-scale conference systems has considerably improved performance and has more variety compared to a few years ago. In addition, pricing has become more reasonable, and I think that helps us meet clients’ needs with better flexibly in terms of both price and performance.
In the future, the need for high-end solutions will continue, especially in industries such as finance as they do not want to allow downtime or latency, and the medical field, which requires clear images and reliable communication.
Users whose priority is a simple user experience and cost efficiency are more likely to prefer cloud based solutions equipped with a certain level of quality in voice, image and communication and good operability. Needs for those services and products are increasing noticeably. I think we will continue using versatile solutions with sufficient quality and reasonable cost based on the needs and situation of each client, and that kind of workstyle will become the norm.
I have many years’ experience in AV related projects. Not only AV solutions in offices but also on the consumer and promotional side of solutions, such as digital signage and LED video wall solutions. One of my strengths is to listen to the client’s needs and provide the best advice, without excess or deficiency. I can help resolve problems that client have based on the knowledge and experiences I have gained from various projects throughout the Asia Pacific region. Please do not hesitate to contact us and I look forward to helping you with your AV solutions soon.”
The growth in Japan seems somewhat moderate according to the data shown, but globally the market is still growing. The desired outcome in Japan focuses on the reduction of travel expenses, however a report says softer aspects such as faster decision-making, increasing business agility and seizing business opportunities can bring about a competitive advantage.
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(*1) 「イノベーションの対応状況調査」 独立行政法人 労働政策研究所・研修機構
(*3) “Global Video Conferencing Market Research Report” by Frost & Sullivan
(*4) Telepresence Equipment Market Analysis, By End-user, By Type (Multi-Codec, Personal, Immersive, Room based), By Form-Factor (End-Points and Infrastructure), By Vertical, By Region, And Segment Forecasts, 2018 – 2025” by Grand View Research