The News: Microsoft’s Surface Hub 2 recently launched the company’s first AI-powered smart camera designed for hybrid teams. The smart camera attaches to the top of a Surface 2 Hub with a magnetic click and a USB-C mount. Read the Press Release from Microsoft here.

Microsoft Surface Hub 2 Launches — the Company’s First AI-powered Smart Camera Designed to Improve the Collaboration Experience

Analyst Take: Focusing on the hybrid work front, Microsoft’s Surface Hub 2 launches its first AI-powered camera is clearly about improving the collaboration experience.

Before I get into that, here are some of the features of the Microsoft Surface Hub 2 Smart Camera:

4K Ultra-wide-angle lens with 136 degrees of horizontal field view
1 Teraflop of compute power (a trillion floating calculations per second)
Automatic framing to capture everyone in the room clearly
Tilt compensation for more natural eye contact by accounting for the camera position
Distortion correction for wide-angle lens so every face is clear

In my opinion, like a cinematographer who knows how to masterfully manage a perfect frame, make lighting adjustments, and more, the new AI-based Microsoft Surface Hub 2 Smart Camera mimics some of the that functionality on the fly. For example, the automatic framing is perfect for when someone enters the room, coupled with distortion corrections, so everyone looks great in the meeting — and isn’t that what we all want? As we all know, anything that makes the video conferencing experience less arduous, and infinitely less complex is going to win favor with both organizations and users.

The ProAV Market is a Fast-Moving, Rapidly Growing Market

Let’s chat a bit about the ProAV market and what we’re seeing there. Times are changing as we emerge from two years of weathering a global pandemic. I believe we’re seeing a resurgence in the commercial ProAV market (e.g. huddle rooms, large conference rooms, etc.), which was negatively impacted due to COVID-19 restrictions and IT spending shifting to remote workers.

We’re now starting to see organizations calling employees back to the office coupled with hybrid strategies and a focus on improving the collaboration experience, which of course bodes well for the ProAV market overall (which also includes digital signage, projectors, collaboration screens, etc.). The ProAV market is estimated to hit $258 billion in 2022 and expected grow at a 7.2-percent compound annual growth rate over the next few years, surpassing traditional IT spending growth rates.

Pre-pandemic, organizations, education institutions and others were feverishly upgrading their campuses for green initiatives, focused on becoming more connected and collaborative to foster innovation, more inclusive in order to attract both younger generations as well as international talent, which is an absolute necessity to compete on a global scale. Although many technology and non-technology areas grew due these trends, a key pocket area of growth came from collaboration screens or a subset of the large format commercial display market due to the adoption of huddle rooms.

Workplaces and Learning Institutions Are Undergoing a Shift — Focused on Designing Workspaces for Innovation and Facilitating Collaboration

Fundamentally, I believe that what we’re seeing in the market is organizations trying to move faster and design workplaces engineered for innovation. On this front, huddle rooms are playing a key role. Huddle rooms are designed to be more relaxed, similar to a coffee house atmosphere where more lateral thinking exists. This is not surprising, as studies have shown that when people are more relaxed, they have a tendency to innovate more.

Now that the pandemic is subsiding and employees, students, and others are making their way back to in person work and learning experiences, I expect greater penetration from collaboration screens in the future from the partner community. For example, many ProAV partners, IT distributors and others I speak with in the industry are heavily entrenched in industries such as healthcare, state and federal government, hospitality, education, manufacturing and more. All of these areas are key markets a calling for collaboration solutions and all want tools designed to make the meetings more dynamic and interactive.

In the postsecondary education market, universities continue to offer more distance learning solutions for both business school and undergraduate programs for out-of-state students, which is forcing upgrades. There is a greater mixture of students in class, along with students who are remote, which calls for more intelligent functionality. In the discrete and process manufacturing markets, operations are typically geographically dispersed and research and development, product management and manufacturing hub are in many cases in different locations and in different time zones.

In healthcare, providers are in many cases overloaded and dealing with staff shortages. This is forcing them to leverage talent (e.g., radiologists, specialists, etc.) in different regions, which is also driving demand for collaboration screens. Lastly, another area is the K12 market, where the classroom is becoming more dynamic and collaboration screen remain the center of gravity for educators who often show videos from YouTube or other sites on various subjects. In addition, like business schools, many K12 school STEM and STEAM programs will often host panels from outside experts in myriad industries so that students learn real-world examples of how to apply what they have learned.

Wrapping Up

In summary, the Microsoft Surface Hub 2 launch is, for me, the right product at the right time. and I see many applications for the AI-powered smart camera and enhancing the collaboration experience is where it’s at, both today and for the foreseeable future.

As I’ve shown in the examples I’ve shared here, the market for collaboration screens is on the rise and it’s clear that solutions infused with more AI capabilities to make meetings, learning experiences, and/or collaboration moments more efficient will be key. I expect increased demand in vertical markets such as healthcare, manufacturing, primary and post-secondary education markets as they seek ways of allowing users to ideas and best practices in the future. With the Surface Hub 2, Microsoft is primed to capitalize on that increased demand.

Disclosure: Futurum Research is a research and advisory firm that engages or has engaged in research, analysis, and advisory services with many technology companies, including those mentioned in this article. The author does not hold any equity positions with any company mentioned in this article.