North American Hosted IP Telephony, UCC Services Market to Grow

By Mini Swamy
TMCnet Contributor

As evolving customer needs shift demand from premises-based solutions to the cloud and from legacy telco services to next-generation IP-based communications, hosted IP telephony and the UCC services market have received a fillip. A study by Reportbuyer confirms this trend as it paints a rather rosy picture for service providers and platform vendors that offer hosted communication services.

According to the report, the IP telephony and UCC services market in North America remained healthy as it witnessed 30.5 percent user growth and 32.9 percent revenue growth. With  providers wooing customers with advanced services such as video, Web collaboration, hosted contact centers and the like with competitive prices, the average revenue per users promises to remain stable. This trend is likely to continue till 2020.

The report notes that growth is primarily attributed to continued demand among under-served SMBs and the emerging demand among larger, distributed organizations that have a large remote and mobile workforce. Also the new found customer confidence in VoIP and a willingness to migrate to the cloud are factors that contribute to the positive aura that surrounds this market.  All this will set the pattern for rapid growth.

Due to the larger installed base, the growth rates are expected to gradually decline year-over-year but the number of new users will increase consistently during the growth study period from 2013 to 2020. Overall, market growth is expected to maintain its steady position of growth.

What could prove to be a dampener, according to analysts, is the large installed base of premises-based solutions and customer concerns over cloud security and stability. Customers will choose solutions based on multi-instance platforms as they are touted to be more secure than the multitenant platform-based solutions.

Currently, the communication landscape is fragmented with providers competing hotly for a slice of the hosted IP telephony and UCC services pie. Also the lack of differentiation in provider offerings and absence of validation of hosted IP communications could be temporary setbacks.

The competitive landscape is not going to change soon as emerging leaders and existing providers fight it out in the middle, fragmenting it further. But if vendors and providers  can streamline operations, differentiate, deliver high-quality and reliable service and efficient back-office systems, accelerate growth through mergers and acquisitions, extend market reach while improving customer service and support, then a big share of the IP telephony pie is theirs.

Edited by Alisen Downey