The International Data Corporation (IDC) has found that Microsoft now accounts for 45.6 percent of the global unified communications and collaboration market.
In 2024, Microsoft solidified its market dominance, posting $31.5 billion in UC&C revenue, a 14 percent year-over-year increase. According to the IDC, this growth boosted Microsoft’s market share to almost 46 percent, which marks a 2.4 percentage point gain over 2023. This underscores its leading influence in enterprise collaboration and communication services.
The IDC also reported that the UC and collaboration market ended 2024 in good health, with global revenues having jumped eight percent year over year. According to IDC’s Worldwide Quarterly Unified Communications and Collaboration Tracker, the UC&C space grew 7.8 percent year over year to $69.2 billion last year.
IDC adds that total revenues are projected to hit $85.4 billion between 2025 and 2029. This growth trajectory reflects a compound annual growth rate (CAGR) of approximately 3.9 percent, driven by continued enterprise investment in collaboration technologies that support hybrid work, cross-functional productivity, and global connectivity.
Denise Lund, Research VP, Worldwide Telecom and Unified Communications and Collaboration at IDC, commented:
The worldwide UC&C market is undergoing a massive transformation with new AI capabilities being released every quarter. Businesses are recognising the value of AI in UC Employee Engagement and UC Customer Engagement solutions. However, the AI-driven growth anticipated in the coming years will be counterbalanced by declines in IP Phones, IP PBX/UC Systems, private cloud UCaaS, and videoconferencing infrastructure segments.”
The IDC also assessed the market position of other UC&C leaders besides Microsoft, notably Zoom and Cisco Webex. In 2024, Zoom reported a reasonably modest one percent year-over-year increase in UC&C revenue, reaching $4.3 billion. Despite the growth, the IDC stated that Zoom’s market share dipped slightly to 6.2 percent, signalling a decline of 40 basis points from the previous year.
Additionally, Cisco experienced a 4.6 percent year-over-year decline in its UC&C revenue in 2024, bringing in $3.7 billion. This downturn also resulted in a market share drop of 70 basis points, reducing its share to 5.3 percent.
IDC outlines that its UC&C Tracker offers a thorough view of market dynamics and vendor performance. It breaks down the UC&C landscape across key categories, including IP Telephony and UC Systems (covering IP Phones and IP PBX/UC Systems), Enterprise Videoconferencing Systems (such as room-based and huddle room endpoints, along with supporting infrastructure), Unified Collaboration platforms, and both Managed and Hosted Voice/UCaaS solutions, encompassing public cloud-hosted voice and private cloud-managed voice services.
The Tariff-Shaped Elephant in the Room
The glaring asterisk to these growth figures, and the projection for future growth, is, naturally, the Trump administration’s introduction of worldwide tariffs in 2025 and the sweeping uncertainty that’s incited in markets everywhere, but especially UC and collaboration supply chains, given the volume of devices and components that China, as the most tariff-affected region, exports.
There are also the medium-to-long-term rippling effects of these tariffs, plausibly catalysing a global recession, or even just the fears of a worldwide recession. The cumulative impact of these broader economic headwinds could slow enterprise IT spending and delay cloud and comms investments.
For UC&C vendors, mainly those reliant on hardware, international markets, or aggressive cloud expansion, the risks include higher operational costs and more cautious customer behaviour. If these trends persist, IDC’s projection of $85.4 billion in cumulative revenues by 2029 may prove overly optimistic, particularly if the broader digital transformation momentum stumbles in the face of economic instability.
How Trump’s Tariffs Are Creating ‘Havoc’ for UC Supply Chains
President Trump’s tariffs on Chinese imports have severely disrupted US supply chains, particularly in UC. The steep tariffs have led to increased costs, shipment delays, and inventory shortages for UC hardware manufacturers. Companies are struggling to find alternative suppliers, as shifting production is costly and time-consuming.
These challenges have resulted in higher consumer and enterprise prices and operational difficulties for businesses reliant on UC tech. The tariffs have also prompted broader concerns about long-term supply chain resilience and the need for diversification away from Chinese manufacturing.
Zeus Kerravala, Founder and Principal Analyst at ZK Research, stressed to UC Today that the key obstacle to tech adapting to this new reality is unrelenting volatility: “The reality is it’s created havoc with the tech companies and their partners because of the uncertainty. I think everyone’s accepting the fact that tears are gonna happen, but it’s the constant yo-yo of we’re in, we’re out, we’re in.”
