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UC Experts Share Their 2016 Industry Predictions for the UCaaS Market

A Transparency Market Research (TMR) report titled, “Unified Communications Market – Global Industry Analysis, Size, Share, Trends, and Forecast 20012-2018”, says that the Unified Communications (UC) market is on track to reach $61.9 billion by 2018. According to the report, “As digitized processes become the norm for modern workplaces and businesses become global, overall modernization in the way processes and resources interact is sought. The market for unified communication methodologies, a market that helps make this modernization easy with its advanced set of software products and techniques, is experiencing rapid growth.”

UC Experts Share Their 2016 Industry Predictions

Furthermore, the report cites the primary growth drivers for the global UC market as an increase in mobile workforces and mobile device usage, coupled with the adoption of bring your own devices (BYOD) in business settings; the continued virtualization of organizations; the need for cloud computing; and an increase in UCaaS implementation.

However, will this hold true in 2016 and beyond? We polled several UC experts, including collab9’s CEO, who shared their predictions on the UCaaS industry for the coming year. Here’s what they had to say…

Kevin Schatzle, CEO, collab9

Kevin Schatzle - collab9

Cloud adoption for Unified Communication and Collaboration (UC&C) solutions in the middle market and public sector will start to experience the rapid acceleration we have witnessed in the SMB marketplace over the last several years. This is being driven by a number of factors, including commoditization of cloud offers, continued expansion of cloud based email, increased security and compliance, and the emergence of microservices. In the larger public sector entities, a variety of hybrid clouds solutions will emerge, such as Contractor Owned Contractor Operated (COCO), and hybrid models around UC software licensing.

Daniel O’Connell, Research Director, Gartner

Daniel O'Connell, Gartner

“Maturing UCaaS platforms from highly branded vendors such as Cisco and Microsoft are legitimizing the industry for large enterprise adoption. This evolution is not going un-noticed by the large cloud providers looking to expand their portfolio of IT services.  In 2016, we look for some of these cloud providers – such as the likes of Salesforce, IBM, Amazon, SAP, Oracle, Google, etc. – to enter the UCaaS market via strategic acquisitions. UCaaS therefore will increasingly be acquired as just one component of a bundle of IT services.”

Sandra M. Gustavsen, Analyst, G Business Systems, LLC

Sandra Gustavsen, G Business Systems

Plenty of recent market studies validate the shift toward hosted/cloud telephony and unified communications (UC) in general, but many also highlight a growing preference for “hybrid cloud-premises” implementations that make use of hosted/cloud services for some applications and on-site solutions for others. Such hybrid solutions can ease a variety of business challenges. For example, a business with an existing phone system already located on-site may find that subscribing to a call recording service, or a hosted contact center capability, is more convenient than actually installing additional hardware and/or software for these applications. Or, perhaps a company wants to continue running a critical business application locally while taking advantage of a pay-as-you-go hosted service for telephony call control. A larger enterprise that has significant investments in equipment may find that a staggered transition with deployments of hosted/cloud services for remote sites, while continuing to use existing premises-based telephony systems at main locations, makes the most sense.

Traditional business telephony vendors that have added hosted/cloud UC services to their portfolios of IP-PBX, contact center, messaging, and other on-site telephony-related solutions are uniquely able to offer these flexible hybrid arrangements – an approach that pure cloud communications providers cannot provide. Look for hybrid cloud-premises implementations to remain a key strategy as the business communications market transitions toward the cloud. The value is clear.

Jim Moore, Federal Sales Engineer, Global Technology Resources, Inc. (GTRI)

Matt Qureshi, Futron Inc.

As all industries continue the information technology (IT) trend of a cloud first adoption, the next few years for hosted collaboration and Unified Communications as a Service (UCaaS) are poised for exceptional growth. The wildly successful hosted conferencing solution WebEx shows the potential for how successful UCaaS will be over the next few years. Chief Information Officers (CIOs) and Chief Technology Officers (CTOs) see that effective collaboration can be complex and challenging, with a mission to support more mobile and dispersed workforces, a requirement to reduce costs, and the desire for reduced power consumption, cooling, and overall carbon footprint. UCaaS will meet these demands over the next few years and will do it with the advantage of a usage-based operational expenditure model rather than having to overprovision with a costly and unpredictable large upfront capital expenditure.

Jon Arnold, Principal, J Arnold & Associates

Jon Arnold, J. Arnold & Associates

The UCaaS market is poised for critical mass in 2016 thanks to the convergence of four trends. First, is the maturation of the cloud and a growing acceptance by businesses to use it for real-time applications and platforms like UC. Second, is the proliferation of hosted offerings thanks to the flexibility of the cloud, where UCaaS can be offered from conventional UC vendors along with service providers of all stripes, and even on a white label basis from channels. Third, is the growing range of UC and collaboration solutions to fit any level of need, budget, or IT capability. Hybrid solutions that support a mix of hosted and premises-based applications make it easy for businesses to deploy UC regardless of their size or investment in CPE infrastructure. Finally, as the workplace becomes increasingly decentralized and mobile, businesses are finding that legacy communications tools cannot support their collaboration needs. In many ways, cloud-based platforms are the best solution, and as businesses learn about these options, the UCaaS market will truly become demand-driven.

Matt Qureshi, President, Futron Incorporated

Matt Qureshi, Futron Inc.

Over the last five years, consumers have seen a drastic increase in the technology solutions available at their fingertips.  Even with the most basic technology, users expect the ability to conduct voice, video, chat, message, or collaborative interactions when using their phones, tablets, or PCs.  As technology continues to become a bigger part of our lives, users will expect these capabilities and their providers to be like basic utilities – always on. This expectation is being driven to the workplace.  As the workforce becomes younger and more technically savvy, they expect the same communication experience choices in the workplace that they receive at home.

In order for businesses to attract the best and brightest talent, they will need to replace outdated, disparate, and limited systems with new Unified Communications Architectures. These technologies will also force businesses to ensure even better SLAs to their users through network upgrades and improvements.  This investment will continue to grow over the next three years as we continue to see an older workforce retire, and a new generation of worker demand collaborative solutions, not only at their desks, but from anywhere they choose to work from.

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