Unified comms as a service market ‘blossoming’ with Mitel and RingCentral leading the way

Unified communications as a service (UCaaS) growth is now consistent at 300,000 seats per quarter with Mitel and RingCentral at the top – and there is plenty more growth where that came from.

That is the verdict of Synergy Research, a long-time observer of enterprise infrastructure markets. The research defines UCaaS as ‘a communications service where service providers host and develop their own proprietary cloud PBX platform, enabling PSTN (public switched telephone network) connectivity and offering an integrated UC applications portfolio stack.’

Mitel overtook RingCentral in terms of new subscribers in Q417, with the Ottawa-based provider the first company to break 100,000 subscriptions in any quarter. There is a large gap to the next biggest players, 8x8 and Fuze, who between them achieved fewer seats last quarter than either RingCentral or Mitel.

According to Jeremy Duke, Synergy Research founder and chief analyst, the growth of the market is an ineluctable trend. “UCaaS seat additions in 2017 were 16% higher than in 2016, which were themselves 11% up on 2015, demonstrating the robust demand for these services to displace traditional premise-based telephony and UC,” said Duke.

“Our firmographic analysis of this market also shows that UCaaS is gaining market acceptance momentum with large businesses and enterprises,” Duke added. “Given the sheer scale of PBX installed base and the low penetration of UCaaS into those segments, this bodes well for continued strong growth.”

RingCentral represents a good example of how the UCaaS market has evolved over the past couple of years. As this reporter mused back in June 2016 when the company announced a partnership with Google, opinion seemed to be divided: was the technology already there but organisations weren’t committing, or did evolution still need to take place on the tech side?

David Van Der Steen – then RingCentral senior manager of product marketing, now senior director of marketing at 8x8 – said at the time that vendors “need to focus on a robust, elegant, and delightful to use application that allows users to seamlessly transition between various communication channels and devices at will. The first vendor to execute on this vision will realise massive rewards through viral user adoption and the resulting increased demand from IT buyers.”

Synergy added it believed the cloud has had a ‘profound’ impact on business communications, with ‘years of future growth’ ahead for the market.


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