The hosted VoIP market will best weather this slower economy by focusing on integration with unified communications applications, according to a new report from an IT market research firm.
Officials at Frost & Sullivan, an international firm with U.S. offices in Mountain View, California, say that features such as chat, presence and conferencing – and business applications such as CRM – will bring the most opportunity to the hosted IP telephony space during this recession.
According to Elka Popova, a global program director at the firm, small businesses will continue to be attracted to hosted IP telephony offerings primarily for cost-efficient voice communications, although some of them will also choose a hosted offering for the ability to gain access to a complete UC package from a single provider.
“Medium and large businesses will also appreciate the economies provided by hosted IP telephony, but will seek such solutions mostly so they can focus on core business processes and gain access to applications and capabilities that they can test without making a capital investment,” Popova said.
Specifically, the firm says in its report – titled “North American Hosted IP Telephony Service Markets” – the number of hosted IP telephony lines will reach about 3.6 million in 2014, up from nearly 1 million at the end of last year.
Integration with UC and business applications will serve end-users seeking a competitive edge, as well as communication vendors and service providers aiming to pick up market share and revenue.
Generally speaking, hosted solutions – which save money for customers on installation, maintenance and repair costs – are expected to do well in this slower economy.
As TMCnet reported, one chief executive officer of a VoIP-based communications solutions provider headquartered in Louisville, Kentucky said in a recent interview that flexibility also is emerging as a major draw for hosted solutions.
Matthew J. Phillips of SinglePipe Communications told TMCnet that during unstable economic times, businesses become more creative and need the flexibility and productivity that hosted services bring to the table.
“Hosted voice services allow an enterprise to grow, or contract one employee at a time, without expending or wasting capital on a PBX (News - Alert) or phone system. SinglePipe and its wholesale partners empower businesses with a communications product that does not tie its employees to a desk in order to communicate, and at the same time lowers operating expenses,” Phillips told TMCnet. “This economy will drive faster development and adoption of unified platforms and application mash-ups with voice platforms to generate efficiencies for the customer and sustain growth.”
Yet, according to Frost & Sullivan (News - Alert), technology enhancements to premise-based solutions and extensive PBX vendor channels present significant barriers to further market penetration.
“IP telephony vendors will have to develop astute channel strategies since most market participants are small, next-generation providers with limited geographic presence and service support capabilities, and with no established customer base or brand-name recognition,” the firm says. It recommends that service providers expand and diversify their channels and strengthen relationships
According to Popova, to ensure extensive customer reach and superior customer support, service providers need to develop stronger relationships with various VARs, SIs, and agents that may include real estate companies, IT consultants, and moving companies.
“Further, providers should seek to develop an eco-system of partnerships to jointly enhance market awareness and be able to offer customers a range of interoperable solutions and capabilities,” Popova said.
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Michael Dinan is a contributing editor for TMCnet, covering news in the IP communications, call center and customer relationship management industries. To read more of Michael's articles, please visit his columnist page.
Edited by Michael Dinan