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Cisco Holds Off Microsoft Surge in UC Collaboration Market

December 04, 2013 - News

Despite challenges from Microsoft, Cisco is holding on to its leadership position in the unified communications and collaboration market, according to third quarter data published Wednesday by Synergy Research Group.

The networking giant has 24 percent market share while Microsoft's share slipped to 19 percent, the research firm said. Meanwhile, the No. 3 player, Avaya reversed a trend of market share decline by boosting UC application and telephony sales.

Worldwide revenue from UC&C, which includes enterprise voice systems, UC applications, telepresence, collaborative workspace software, email software and enterprise social networks,  reached $5.7 billion in the quarter, marginally up on third quarter of last year, Synergy noted.

Revenues from enterprise voice and telepresence continued to soften due to a combination of factors, including a growing shift to software-based pricing, strong competition amongst vendors and competition from disruptive technologies such as cloud UC.

The quarter saw particularly strong growth in email software and enterprise social networks, while on a rolling annualized basis collaborative workspace software has seen the strongest revenue growth -- a segment in which Microsoft enjoys a 47 percent market share.

"In the premise equipment market we continue to see a strong transition in spending away from legacy technologies and towards software-based collaborative applications," said Jeremy Duke,  Synergy's founder and chief analyst. "Microsoft and other vendors that are transitioning to a software pricing model are benefiting from this spending shift and we anticipate that this change will continue to have a positive impact on future revenues. Notwithstanding the temporary blip in Q3, Microsoft continues to gain share in UC collaboration and is closing the gap on market leader Cisco."

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