The global UCaaS market is expected to surpass 131 million users by 2028, new research by Cavell suggests.

Cavell’s 2024 Cloud Comms Market Reports canvassed over 100 service providers across the UK, Europe and the US, informing its estimate that the UCaaS market will grow to over 131 million users by the end of 2028, with a compound annual growth rate (CAGR) of 10.3 percent over the next five years.

However, Cavell indicated that the total available market is shrinking as fewer on-premises PBX users transition to cloud PBX. Many enterprises are opting for collaboration-only licenses without external PSTN functionality for their employees. Cavell also observed declining margins and revenue streams in traditional cloud communication and UCaaS services for over 36 months, with over 40 percent of surveyants reporting a decrease in UCaaS revenue.

Dominic Black, Director of Research Services at Cavell, said:

Historically, providers won new users by migrating from on-premise solutions. However, as the market has matured, this has changed as there are fewer on-premise deployments to migrate. This will drive more competition and the need for providers to differentiate whilst also potentially starting pricing consolidation.”

Black continued by noting Cavell had inferred from its research that the proportion of customers being won from a competitor’s UCaaS solutions had been increasing steadily over the last few quarters. Black underlined that almost half (49 percent) of cloud communications providers had won the majority of their customers from competitors, which was the first time this figure has matched the percentage won by migrating from on-premise products and services.

Other Key Findings From Cavell’s Report

There were several other key figures in Cavell’s 2024 report, including that 62 percent of providers are diversifying their portfolio to enhance the resilience and adaptability of their telecommunications business.

“The convergence trend is also being accelerated by the increasing overlap between the communications, IT, and productivity sectors enabled by collaboration solutions such as Microsoft Teams,” added Black. “Modern collaboration solutions now offer capabilities that would have previously fallen into different areas of technology.

“Now, as these solutions become more popular globally, partners who traditionally would have focused on IT services are encountering established communication partners and vice versa.”

Another compelling figure is that 48 percent of providers are integrating AI capabilities into their products to drive cost reduction in operators’ businesses. Cavell’s research highlights the growing significance of mobile UCaaS services, constituting over 15 percent of the market.

One final key finding underscored the ever-growing dominance of Microsoft and its Teams platform. Cavell noted that, by the end of 2022, one-third (33 percent) of users are expected to be Microsoft Teams voice-enabled.

“Our research also shows that Microsoft Teams continues to grow in importance in the enterprise segment, with a significant portion of the market enabling voice services within Microsoft Teams,” Black explained. “Operator Connect is growing in importance, but Direct Routing is still the most adopted solution at the moment — although this is going to change in the future. Teams Phone Mobile is still in its infancy in many markets with only a few operators having launched services.”



from UC Today https://ift.tt/hPeo3lB