The UCaaS Market Is Growing And Here’s Why

An Ovum study conducted with over 1,300 ICT decision makers in 18 countries revealed that organizations are still bound to on-premises Unified Communications. Around 80% of UC systems are deployed on-premises and managed internally or by a third party. Managed UCC arose from the need of organizations lacking in-house experts to support the UC evolution. So where’s the cloud in all of this? If we look below, we can see that hosted core IP PBX stands at 3%, while instant messaging and presence lead the way with 7%; which is a lot less than we’d like.

Yet, according to a new study from Markets and Markets, the UCaaS market is poised to bring in $13.1 billion this year. The firm projects that market will grow to $23.34 billion by 2019, boasting a 12.2 percent compound annual growth rate over the next five years. It seems that over the next two years, more and more organizations will be considering to switch to the cloud, partly because in-house systems will reach end-of-life and support and partly because better security and privacy policies will be imposed on cloud providers. Though, various UC functionalities will most likely be moved to the cloud separately, as the graph below indicates:

With this in mind, providers should consider adding UCaaS to their portfolios for a variety of reasons:

  • It’s cost-effective. Because UCaaS solutions are delivered through the cloud, businesses can forgo capital expenditures associated with hardware and instead pay on a per-user basis. This makes the technology extremely scalable, as businesses are able to scale up or down based on how many seats they need to address current business needs. Providers need to offer this kind of customization, particularly as businesses keep striving against today’s tough economy. Yet, as a service provider, it’s good to know that companies will be open to this kind of logic, only after on-premise equipment has reached its timely ending. It’s quite rare that a company ignores such costs for the sake of future gains.
  • It’s reliable. Communications infrastructure is the backbone of business. When it goes down, business grinds to a halt as employees cannot communicate with one another and customers cannot connect with their service supplier. UCaaS providers are able to offer resiliency and redundancy by placing their servers at multiple data centers so that, if one gets knocked offline, the other will keep powering the tools. Today’s businesses need this type of redundancy that cannot be found in traditional, on-premises tools.
  • It frees up resources. The IT team no longer needs to invest time to ensure that the communication tools are working properly. Instead, the vendor administering the tools takes care of all of that. This means that a business can allocate resources more effectively, relying on a team of professionals to look after their communications and make sure they stay online. On top of that, the third-party vendor also assumes responsibility for updating the tools.
  • It leverages the power of the cloud. These days, businesses are powered by mobility. Because UCaaS solutions are cloud-based, employees are able to access them from any Internet-connected device. This bolsters productivity while improving employee morale, as they are able to access the tools they need to do their jobs, no matter where they happen to find themselves. Additionally, co-workers are able to collaborate more effectively because of that functionality, increasing both innovation and time-to-market.

With these benefits in mind, providers are making moves to add UCaaS tools to their portfolio in the near future. As businesses are set out to reduce their expenses while increasing their productivity and to take advantage of the latest transformative technologies, chances are they will look toward UCaaS to meet those ends. Click here to learn more on how UCaaS can help.

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