Corona 19 came like a lightning bolt. And it has changed a lot. One of them is’population of the 4th industrial revolution’. It is true that the Fourth Industrial Revolution has been felt only as some declarative slogan. However, after Corona 19, its perception has changed significantly. I realized that the Fourth Industrial Revolution is not just a slogan, but a matter of survival. GDNET Korea looks forward to the evolutionary direction of the 4th industrial revolution with 10 keywords in the new year of the new year (辛丑年).[편집자주]
⑨Non-face-to-face: a non-face-to-face economy is essential, not an option, leading to explosive growth
As social distancing has been progressing for more than a year to stop the virus pandemic, the whole society is being reorganized around non-face-to-face. In particular, telecommuting, which has become common since the beginning of last year, has been a hot topic in most companies that operate business, and establishing a non-face-to-face work environment worldwide has been a big challenge.
Major global companies have come out that choose to maintain the telecommuting system until this year or next year, and even choose to keep the telecommuting system forever. Domestic companies are also increasingly introducing telecommuting.
The social distancing is expected to ease to some extent if the corona19 vaccination and the spread of treatments expand in the second half of this year. However, the forced, non-face-to-face working environment is expected to continue in the future, and for the time being, it is not an option. Accordingly, it is easy to predict that non-face-to-face related industries will grow rapidly.
Video conferencing-collaboration tools lead to explosive growth
The Ministry of Science and ICT predicted that the market for related solutions such as telework, distance education, and telemedicine will grow rapidly worldwide this year. According to IDC, the remote solutions market is projected to more than double from $224.5 billion in 2018 to $527.9 billion in 2025.
Competition between domestic and foreign companies to preoccupy the initial market is fierce in the fields of video conferencing and collaboration tools.
Video conferencing and collaboration tools were spotlighted as non-face-to-face solutions last year.
In particular, the field of video conferencing enjoyed the highest boom. Zoom, a video conferencing service provider, grew 9 times last year with a market capitalization of $144.2 billion. Quarterly sales surged from $190 million at the beginning of the year to $780 million in the fourth quarter.
In the case of Microsoft Teams, the number of active users per day increased from 30 million to 115 million per day after the Corona 19 pandemic. In the third quarter of last year, Teams users spent 30 billion minutes a day, and each person worked as Teams for an average of 4 hours or more per day.
Cisco Webex recorded 590 million active users in September last year, doubled the number of users in six months, and now exceeds 600 million.
The market for collaboration tools has also grown rapidly. Slack, a representative collaboration tool, had 142,000 paid users as of the end of October last year. This is a 30% increase from 110,000 at the end of January of the same year. Compared to the same period in the previous fiscal year, the number of new subscribers has increased about twice. Sales also increased by 39% year-on-year to $234.5 million.
In Korea, the government directly created demand for non-face-to-face solutions, leading the growth trend. The’K-non-face-to-face service voucher’ system implemented by the Ministry of SMEs and Startups invests a total of 640 billion won. Accordingly, related companies such as video conferencing, collaboration, and security have exploded. Naver, KT, Kakao Enterprise, NHN, Samsung SDS, Tmax Soft, Hangul and Computer, etc. have entered the market regardless of size.
The’Service Desktop (DaaS)’ or’Cloud PC’ area, which uses work PCs as virtualized services along with video conferencing and collaboration tools, is also growing. The government and public institutions plan to introduce DaaS by 2026, and large companies-centered VDI environment upgrade projects have decreased.
The double helix of integration and niche: business platform blooms
If the so-called’point solution’ attracted attention in the construction of a non-face-to-face environment last year, it is expected that the establishment of an integrated non-face-to-face work environment will lead the year.
Non-face-to-face work is not perfectly accomplished by using only video conferencing or collaboration tools. When a company’s business process system is reorganized to focus on non-face-to-face, it is bound to link and utilize various non-face-to-face related solutions.
Accordingly, it is expected that the composition will be restructured by competition between professional solution companies and integrated solution companies. The main flows are the formation of an alliance between professional companies, the conclusion of a partnership that does not match the enemy and allies, and the establishment of integrated solutions for large companies.
The signal is Salesforce’s acquisition of Slack at the end of last year. Salesforce has integrated Slack’s collaboration tools into its customer relationship management (CRM) platform to have a non-face-to-face platform.
It is expected that Microsoft will provide video conferencing and collaboration tools together in Teams, and will launch a great attack with bundled services that include office and business applications, cloud, and operating systems. Microsoft is expected to introduce a’Cloud PC’ business that uses Windows as a cloud service this spring.
Google has changed the existing G Suite brand to’Google Workspace’ and strengthened its target to the non-face-to-face business market.
The flow of formation of a coalition among domestic companies is in earnest. KT formed the Cloud One team last November. 19 industry-academia-research companies and institutions participate. Hangul Computer, Tree Technology, Somansa, Penta Security System, Saltlux, Tilon, Tmax A&C will provide non-face-to-face and cloud solutions.
Alliances among small and medium-sized companies are also active. Madras Check’s’Flow’ is linked with RSupport’s video conference’Remote Meeting’. Video conferencing company Gurumi will be equipped with a document co-editing function with SynapSoft.
Naver, NHN, and Kakao Enterprise are moving toward expanding the range of solutions through their own investments. Naver spun off Naver Works as a subsidiary’G-Works’ to enter the enterprise solution market. Naver Works added video conferencing functions to messenger and mail. Kakao Enterprise’s corporate messenger’Kakao Walk’ is also looking to evolve by reinforcing the video conferencing function.
It is expected that the non-face-to-face solution field will expand and evolve into the’business platform’ field in the midst of the strong trend of convergence and integration.
In this trend, strategies can vary depending on the size and situation of the demanding company. In the case of large corporations with a large budget, it is highly likely to build a large-scale integrated platform rather than purchasing multiple specialized solutions individually. On the other hand, small and medium-sized enterprises (SMEs) tend to adopt specialized solutions only in areas where they are needed due to cost issues. Mid-sized companies can deepen their concerns between linking professional solutions and introducing integrated platforms.
The combination of Salesforce and Slack is noteworthy in terms of market differentiation. Salesforce mainly has large companies as customers, and Slack has customers mainly for startups. Due to the large heterogeneity of the customer base, the potential customer base may differ depending on which side the combination of the two solutions is centered on.
For example, Microsoft’s Teams has been supplied as part of’Microsoft 365′ to customers of mid-sized, large enterprises, and large educational institutions. With Microsoft not providing Teams as a separate solution, small and medium-sized companies have hesitated to invest heavily in Microsoft.
Turning to a turning point in support policy for introducing non-face-to-face services
The government has been running the’K-non-face-to-face service voucher’ project since September last year to promote domestic demand for non-face-to-face solutions and support the transition of domestic SMEs to non-face-to-face work environments. It is a system that supports 90% of the cost when a demand company selects a solution recommended by the government by investing 640 billion won in subsidies.
This year, it will invest 2166 billion won in non-face-to-face service vouchers. It plans to provide accelerating support to promote overseas expansion based on domestic performance by investing 7.5 billion won.
The Ministry of Science and ICT also announced a plan to support the export of non-face-to-face solutions by domestic companies.
Through overseas bases such as’Korea IT School’, a software advance base in Ho Chi Minh and Hanoi, Vietnam, it will cultivate local human resources that can be used by domestic companies, and cooperate with overseas development support organizations to support the construction of overseas data centers for domestic IDC operators. To localize software products, it plans to support quality improvement through consulting such as market research and verification of local customers and experts. Security products promote localization by providing certification information and acquisition consulting support for each country, cooperation between countries (CAMP) and overseas bases.
The government’s non-face-to-face industry support policy is geared towards SMEs. In the case of global advancement, the joint export of large companies and SMEs is supported, but the domestic market promotion measures are concentrated on SMEs.
Therefore, Naver, KT, and Kakao must compete with global companies in the domestic market. In the midst of this, mid-range solution companies are in a strategic position to target the large and small business markets together.
The non-face-to-face service voucher business is the biggest leverage that can enjoy market preemption. As software evolves from built-in to subscription-based cloud services, customer data is moving to the cloud. This is a factor that makes it difficult to replace a solution or service once introduced with a substitute.
Therefore, if a non-face-to-face service voucher supplier secures more than a certain level of customers, it will be possible to maintain a stable source of income for a certain period of time even if the government policy ends. This is the main reason for aggressive marketing by several non-face-to-face specialists in the fourth quarter.
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The point when non-face-to-face solutions just became available in the fourth quarter of last year was a battle for brand awareness. From the last new year of the quarter, as customers gain experience in using them, the aspect of the fight shifts from recognition to reputation. How much is invested in the fundamental competitiveness of services and solutions, and how to promptly reflect customer voices is the measure of success or failure in the future.
An official in the domestic IT industry said, “From the era of solutions, where IT flows were led by developers to determine the direction of upgrades in a one to two-year cycle, it has shifted from the era of services to a service that immediately accepts the voices of customers and continuously improves them. “We can secure customers in the non-face-to-face era only when we rapidly accept customer feedback and invest in development systems and capabilities that can be realized through service improvement.”