Although where we work is still up for debate, keeping us online is the main priority.
While the consensus from managers may be that the office is the best place to be, remote working is still a huge priority for the employees.
While that war may rage on, the job of connecting employees in and out of the office has become more challenging as phone calls become video catch-ups that rely on bandwidth that may not be suitable.
Therefore, UC Advanced asked some key questions to get a temperature check on the UCaaS sector:
What is the state of the market for Unified Communications?
Steve Rafferty, VP International, RingCentral:
“As businesses have transitioned from outdated communication systems and adapted to dispersed workforces, UCaaS has emerged as a favoured solution due to its flexibility and scalability.
“By 2032, the UCaaS market is expected to grow to $311.6 billion, and over 80% of organisations will rely on UCaaS for their primary communication needs. This surge is attributed to the rising trend of remote and hybrid working models, global cloud accessibility, and an ever-increasing demand for adaptable solutions.
“UCaaS solutions have continued to evolve beyond traditional voice calls to incorporate a wide range of communication channels, including video conferencing, instant messaging, file sharing, and presence indicators. The many modalities enable seamless communication and collaboration across multiple devices and platforms. Therefore, organisations can access advanced communication and collaboration features without the need for extensive on-premises infrastructure.”
Justin Hamilton-Martin, Director of Product Strategy, Enreach
“The market is in good shape with a number of high-quality solutions available and an established channel structure. There is however a gap between the potential for the wider product portfolios and the sales teams’ ability to engage and convert customers.
“We are talking a lot about the CX’s potential, but in the SMB space, I think the channel is struggling to get sales teams properly focused on the benefits to achieve conversion. This may be down to focusing on ‘new customers’ rather than additional revenue growth from existing customers, or it may be due to a lack of experience in translating features into desired customer outcomes. Whatever the reason, it feels like we are behind where we should be with CX’s real growth.”
Andrew Cooper, Head of Nimans Connect:
“Unified Communications has gone through its natural transition, whether you call it Cloud Telephony, UCaaS, or CCaaS it has a foothold now but the interest has probably levelled a little bit.
“In times gone by channel magazines would talk about the death of the PBX but PBX is still being sold because technology never moves forward as fast as vendors want it to and there are a lot of businesses out there that have a PBX or a premise based solutions who question if they need to change?
“I also think the UCaaS market will still see a huge amount of consolidation because it’s a very different kind of sale where you invest a huge sum of money upfront to get a long-term return. So it will ultimately come down to how much money businesses have and how long they can last through that process.”
Is the PSTN switch-off proving an effective angle for sales?
Steve Rafferty:
“The current PSTN infrastructure has an array of benefits, particularly in reliability and usability. The infrastructure has existed for decades and the technology has been refined to the point of perfection.
“As it’s powered by a network of copper wires and not internet connectivity or electricity from the national grid, they remain unaffected by power outages, lack of broadband connection or network crashes. Furthermore, PSTN networks are low maintenance and easy to set up. “However, PSTN infrastructure has its drawbacks. For businesses, PSTN infrastructure can be considerably more expensive with limited features. As such, the switch-off does present an opportunity for businesses to modernise their communications approach.
“Businesses shouldn’t wait until the forced migration to ensure preparedness. They should review their connectivity now and for example, ensure their broadband has a strong connection and bandwidth to handle calls and involve employees in the transition process to ensure they’re equipped to use the technology.
“VoIP is easy to buy and set up with no line rental costs, it’s flexible and scalable which allows you to access your number over the internet. There is also disaster recovery which means that we can provide an automatic failover capability to ensure you don’t miss a call. This among many other benefits will be advantageous for businesses to maintain business as usual and have access to the latest innovations fit for their needs today.”
Justin Hamilton-Martin:
“I think the PSTN switchoff has been over-marketed in the last 4 years Many end users do not yet view the PSTN switch-off as a compelling event — making it hard to get those as much as half the market has yet to move.
“Perhaps 50% of the market has not moved to see this as a compelling event. Whether this is driven by apathy, a belief that the deadline will move, an expectation that their supplier will just deliver a different sort of line to plug in, or thinking they will ‘get to it’ this year.
“Regardless, I feel the channel needs to help investigate benefits beyond just the switch off, suggest migration plans and potentially grease the wheels with free contract overlap periods, to get the conversation moving.
“It is pretty disappointing that in an age where we (the sellers) are so convinced by the benefits of cloud solutions, it is a surprise that so much of the market is yet un-moved many telcos have yet to update their bases to SIP trunks or the cloud and so will soon come under threat from other, more mondernising convergence players.
“Telco resellers must really be aware of the growing threat from IT and connectivity players who are hunting new blended revenue business and can use this stalled cohort to boost their move to converged provision.”
Does the service model make solutions more popular?
Steve Rafferty:
“At a time when businesses are more cost-conscious and progressing with digital transformation phases in increments, our service model at RingCentral allows businesses to try our solutions before a lengthy commitment to a particular product/service.
“Customers can see how the solution fits with what they already have, how employees are adapting to it, and adjust their add-ons or customisations to make it even more bespoke to their Business.”
Justin Hamilton-Martin:
“We are in a period where the customer is likely to have more than one trusted provider, so the service wrap, the detailed support in technology investigation, and the simplicity of transition plans will affect who owns the UC element of the combined communications business.
“Telco players may need to rapidly establish an IT capability as well as provide great ongoing service. This is true, especially in the SMB sector, which will be dictated by the revenue the customer spends with each provider. To get great service smaller businesses need to identify a single supplier.”
Andrew Cooper:
Recurring revenues are very interesting because there’s potentially a higher value to your business. In a CapEx model, you’re only as good as your previous month’s sales, whereas in a recurring revenue model, customers stay lit up and you’ve had that revenue coming through.
“For businesses like Nimans, although premise-based PBX sales have declined over the years, there is always an opportunity through this transition. Businesses will still want phones or headsets, and need routing equipment or switching equipment to deliver this kind of technology, these things generate more opportunities.
“We’re seeing products like Microsoft Copilot are typically sold on a monthly subscription type basis. So it’s a natural evolution for businesses.”
How is hybrid working affecting the interest in UCaaS solutions?
Steve Rafferty:
“The evolution to hybrid working for most businesses has been an inflexion point and a chance to review their tech stack to support business communications. At the height of the pandemic, communications and collaboration tools were intended to streamline workflows, but the volume of apps that some businesses were using created a sense of communication chaos that resulted in a productivity pinch, at a time when businesses and economies needed workforces operating effectively.
“Our research found that 52% of employees are using six or more communications apps in a typical work week. Over a fifth (22%) are spending over two hours checking notifications, meaning they could be spending up to 63 days per year (or 500 working hours per year) toggling between apps. Furthermore, 34% said they would prefer to have a single platform for their work communications and collaboration.
“Businesses need solutions that allow employees to seamlessly communicate as they move between remote and in-office settings or work from different locations such as home, coworking spaces, or even client offices. Furthermore, any solution must not impact broader business productivity and efficiency.
“With these business challenges in mind, I believe interest in UCaaS solutions will remain high, and we’ll see more organisations use it as a strategic lever, not only as a way to hire and retain talent but also to revolutionise
how they work with clients and provide customer support.”
Justin Hamilton-Martin:
“We must always remember that the customer buys the outcome and not the technology, so if they achieve remote working from an on-premise solution they will see only success. UCaaS is a flexible model which facilitated rapid remote deployment in 2020, but for UCaaS to displace other business solutions it has to prove that it is ultimately more effective, secure, reliable and able to integrate with the customer’s other technology investments.
“UCaaS suppliers must provide a blended solution, bringing together as many of the
customer’s required tools as possible, otherwise they will be the last, rather than the first, consideration.
“Hybrid working is a general term referring to the location of the worker. The toolkit they use will be dictated more for the work they do and the interactions they have with colleagues and customers.
“Outside of sales and service, many workers only engage with customers and suppliers by arranged meetings, in which case the collaboration tools need only be linked to the calendars and email services. Conversely, if people deal with real-time, on-demand communications then voice, chat and CRM integration becomes more of a driver.”
