The communications and collaboration market in Singapore is expected to continue surging, with the overall market size anticipated to reach US$2.1 billion by the end of 2025 thanks to the persistence of flexible work arrangements by local organisations.
This is according to analyst firm GlobalData, which predicts that the total addressable market size of communications and collaboration infrastructure in Singapore, in terms of enterprise spending opportunity, is set to increase at a compound annual growth rate (CAGR) of 6.6 per cent between 2020 and 2025.
Far from being saturated by the rush to implement communications and collaboration solutions following the onset of COVID-19, the local market is still seeing growing demand for conferencing services, communication platforms, and enterprise social networking and collaboration tools, according to GlobalData.
Among all communications and collaboration market segments, comprising hardware, software and services, the latter is anticipated to be the largest contributor to the overall market value through the forecast period.
“The widespread enterprise adoption of remote operations following the COVID-19 pandemic has bolstered the demand for [communications and collaboration] infrastructure during 2020,” said Samrat Volam, technology analyst at GlobalData.
“With most enterprises expected to continue with their flexible working arrangements over the next few years, growth prospects for [communications and collaboration] infrastructure will remain strong with the overall market size reaching US$2.1 billion by the end of 2025,” he added.
Much of the expected growth will come from the likes of mobile data, web and video conferencing and managed IP telephony services, all of which will see healthy growth over the forecast period.
At the same time, traditional services in the communications and collaboration space, specifically fixed voice and mobile voice services, will see their enterprise spending decline at a CAGR of -7.9 per cent and -4.2 per cent, respectively, over the forecast period, owing to the widespread shift towards unified communications platforms.
Indeed, the communications and collaboration software segment, comprising communications platforms and enterprise social networking and collaboration platforms, represents the fastest growing market segment by value, according to GlobalData.
A key factor driving rapid growth in this particular segment is the fact that most of the new platforms are cloud-based, making their deployment relatively cost effective.
Moreover, the majority of large-scale enterprises in Singapore are already used to cloud implementations and, as such, have been quick to embrace cloud-based communications and collaboration platforms for an agile communications infrastructure.
“While the large enterprise segment...will account for largest share of the total enterprise [communications and collaboration] spending opportunity in Singapore through the forecast period, the combined spending opportunity from micro...small and medium...enterprises will increase at a marginally faster CAGR of 6.7 per cent over the forecast period,” Volam said.
GlobalData's analysis mirrors research by other analyst firms showing the seemingly unstoppable trajectory of collaboration software usage and investment among enterprises since the pandemic hit.
Global collaboration software spending alone reached US$22.6 billion in 2020, a recent report by analyst firm IDC claimed. The year-on-year increase of 32.9 per cent outlined in the research represented the fourth successive year of double-digit, year-on-year growth for the segment, according to IDC.
The five largest collaboration software vendors by revenue – Microsoft, Google, Zoom, Cisco and Slack – accounted for 64.2 per cent of the market, up 4 per cent from the previous year, the research suggested.
Meanwhile, the top 20 vendors saw 40 per cent annual revenue growth, on average, during the year, though Zoom outpaced the market with a 227.1 per cent increase.
