CIO “disquiet” over unified communications costs


Australian CIOs and IT managers have voiced “disquiet” over their inability to justify a return-on-investment on unified communications, a new study by Frost & Sullivan has found.

The cost of upgrading their base network infrastructure to support a unified communications deployment, together with systems integration and software licensing costs are proving key concerns for organisations.

However, the costs don’t appear to be deterring take-up, particularly in the banking, finance, education and professional services sectors, according to Frost & Sullivan senior research manager, Audrey William.

“Unified communications involves a lot of investment to get the base infrastructure right. Customers have to work with the right service provider, systems integrator and channels to make sure their network can support the increased bandwidth requirements,” said William.

“Some applications like videoconferencing have a very clear return-on-investment by reducing travel costs, and we anticipate these will drive unified communications adoption in time.”

The banking and finance sector is leading adoption of unified communications locally, accounting for 16.5 percent of the total $484.7 million Australian market. Education and professional services are also strong verticals for adoption.

Telephony refresh is a common start point for many organisations. Although predominately in “early stages of adoption”, several organisations are deploying richer applications that integrate presence and mobility, or incorporate high-definition videoconferencing.

William also claims that, despite general concerns over return-on-investment, the price-sensitive SMB segment represents a strong future growth opportunity.

“Bundled email, voice and presence services, for example, offered via a pay-per-use model will be very compelling in the SMB market,” explains William. “A lot of vendors are working with service providers locally to make this happen, and we expect a lot of offerings to appear over the coming months.”

The Unified Communications Technology Adoption by Verticals 2008 report surveyed 365 CIOs and IT managers across a number of Australian vertical markets.

CIO “disquiet” over unified communications costs
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