Virtual Office Featured Article

The State of Business Communications, UC & VoIP

November 07, 2018
By Paula Bernier, Executive Editor, TMC

VoIP used to be just about all we could talk about in the communications world – and with good reason. Transporting voice over the internet or other IP networks has enabled businesses to lower their costs by decreasing or eliminating their telecommunication phone line costs; avoiding international calling fees; and simplying business voice management, including adds, moves, and changes.

Today, VoIP is widely accepted as a useful business tool. But it’s just one part of the business communications toolbox.

“VoIP is not a new technology and is not considered a high-risk way to manage your business calls,” says Tom Collins, director of enterprise sales and marketing for Atlantech Online. “The vast majority of businesses who switch to VoIP from traditional telephones unlock massive cost savings, simpler contact center management, and more features.”

Of course, we don’t talk as much about VoIP anymore In recent years the focus has turned to broader discussions about business communications and collaboration solutions. Such solutions are also commonly referred to as unified communications, although that term seems to be falling out of favor.

Interestingly, everybody seems to be pretty ok with the term UCaaS. And that stands for unified communications as a service.

UCaaS is just a different model through which UC solutions suppliers deliver a suite of business communications capabilities. UCaaS typically includes collaboration, conferencing, file sharing, and VoIP. “Adoption of UCaaS is soaring; Forbes projects that 80 percent of IT budgets will be dedicated to cloud apps and solutions within 15 months,” Collins wrote in January.

The global installed base of UCaaS subscriber seats is growing by more than 25 percent per year, Synergy (News - Alert) Research Group says. And in late August the firm reported that “for the tenth successive quarter more than 300,000 UCaaS subscriber seats were added to the global installed base.”

While small and medium businesses were the early UCaaS adoptors, Synergy adds, more recently large enterprises have been driving much of the subscriber growth in this arena. “UCaaS is going mainstream now, and we are seeing strong uptake by larger enterprises, while mid-market growth remains robust and SMB growth rate is tailing off a bit,” says Jeremy Duke, the company’s founder and chief analyst. "With UCaaS penetration of the PBX (News - Alert) market still running at under 10 percent, there remains a long runway for substantial UCaaS growth over the coming years. Looking ahead we expect to see mid-to-large enterprises increasingly driving subscriber numbers. We will also see countries beyond the U.S. playing a substantially bigger role in the worldwide market.”

In May, IHS Markit deemed RingCentral the No. 1 UCaaS provider in North America, with 8x8 (News - Alert) and Verizon next in line. Other UCaaS leaders, according to IHS Markit, include Mitel, Comcast, Vonage, West, Star2Star, Nextiva and Fuze.  

“Our scorecard this year shows that while the leading pure-play providers are a force, they have serious competition, particularly among older, more established companies — namely incumbent operators like Verizon, traditional UC vendors such as Mitel (News - Alert), and cable operators like Comcast,” says IHS Markit analyst Diane Myers. “The ongoing demand for UCaaS services is vast, with a broad set of customers and requirements.”

Synergy considers RingCentral (News - Alert) and Mitel as the UCaaS market leaders. It indicates 8x8, Cisco (Broadsoft), and Vonage are next in line. 

Omar Javaid, chief product officer at Vonage, this week told us: "Businesses today are looking for ways to enhance connection and collaboration internally among employees while driving engagement and deeper relationships externally with customers. To address this need, more and more businesses are moving to the cloud, relying on unified communications and programmable communications via APIs to allow their employees more flexibility, increased mobility and enhanced productivity by enabling them to work and connect with customers anytime, anywhere, from any device and via any channel. 

“The ubiquity of the cloud and the convergence of these technologies are opening up new paths of communication for businesses as they look for innovative ways to stay ahead in an increasingly competitive marketplace,” said Javaid, who will be speaking at The Future of Work Expo early next year. “UCaaS empowers companies to connect their external customer communications into their internal employee communications, including integration into business applications, social messaging apps and workflow tools, such as CRM. As the integration of APIs into existing business applications continues to grow and see mass adoption, the practice will enable businesses to plug more easily into new and emerging trends in communications technology.

“Chatbots, artificial intelligence, and virtual assistants are all finding a place among even the most traditional of enterprise business’ communications systems,” he continued. “As these trends take hold, they will make a significant impact on the ever-changing face of business communications, empowering businesses to strategically compete in their industries better than ever before."

Edited by Maurice Nagle

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