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While there are differences of opinion on whether the recent Avaya Chapter 11 bankruptcy filing could have been prevented, consensus has emerged on what it means for telecom providers going forward: premise solutions are dead, and businesses are embracing the cloud to stay competitive.

The premise-to-cloud momentum was not lost on Avaya. However, it proved difficult to speed up the cloud transition for customers that had invested heavily in premise-based infrastructure. It then became a race against the clock to catch up with competitors that were primarily or exclusively cloud players. After all, when your team is down three scores with only one quarter remaining, the window of opportunity has closed (unless you are Tom Brady, apparently).

Avaya’s predicament sends a clear signal to telecom providers of what it will take to be competitive and capitalize on opportunities in the PBX and Unified Communications (UC) market. For 2017, the projection is that cloud will comprise approximately one-quarter of total PBX/UC line shipments; but by 2020, multiple industry analysts forecast that cloud PBX/UC shipments will surpass premise-based shipments.

As the market advances towards this projected cloud crossover point, telecom providers can position themselves to grow cloud revenues and customers by focusing on delivering three core capabilities via the cloud: mobile-centric unified communications, team collaboration, and contact center.

Superior end-to-end mobile UC experience

Businesses are shifting their communications to the cloud due to its simplicity to use and manage relative to premise-based systems, cost benefits through the elimination of CapEx, and flexibility to meet the specific communications and collaboration needs of each organization. Further, it provides rapid access to advanced features and capabilities without the need for slow, costly, and labor intensive enterprise-wide software upgrades.

Among the most valuable capabilities cloud enables is seamless mobile unified communications. Companies are re-orienting their businesses around mobility, and the mobile phone has become perhaps the most indispensable business tool. But the user experience of real-time unified communications on mobile devices has not quite kept pace.

Today, many UC applications are “over-the-top” – downloadable apps that use whatever data connection is available. This is adequate for messaging and file sharing, but often falls short for critical real-time functions such as voice and video. Poor mobile data or WiFi connections leads to patchy connections that are not appropriate for business use, while complicated user experiences put the burden on businesses to awkwardly tie together separate wireline and wireless numbers to support mobile workers. 

Cloud platforms can provide business users with a truly mobile experience through one service, one experience, and one business number – along with the flexibility to add messaging, voice, video, conferencing and other UC applications as needed. And mobile-centric UC is becoming a must for businesses: our 2016 Cloud UC survey of global telecom providers reveals over 90 percent of UC business users will require mobile integration – an opportunity for telcos in 2017 to deliver a superior native end-to-end mobile business experience powered by the cloud.

Team Collaboration is key to competitive UC offers

On average, employees receive 90 business emails a day, on top of having to track and manage multiple IM threads, files stored all over the place, and disparate business applications that don’t integrate with one another. It’s little wonder that analyst firm IDC says the typical knowledge worker spends 2.5 hours a day searching for information.

Standalone team chat/messaging offerings that do not integrate with other business applications risk further overwhelming worker, rather than making them more productive. In the previously referenced survey, 78 percent of respondents indicated team collaboration is an important business end user requirement. At the same time, a whopping 95 percent believe integrating team collaboration into their broader cloud unified communications offering represents a significant business opportunity.

Cloud Contact Centers massive opportunity for service providers

The cloud-based contact center market is expected to grow from $5.4 billion in 2016 to $15.67 billion by 2021 – a Compound Annual Growth Rate (CAGR) of 23.6 percent during that period, according to a December 2016 Research & Markets report.

BroadSoft’s own survey reaffirms a cloud contact center market poised to explode, as by 2020 cloud-based contact centers seats as a share of overall contact center shipments will reach 43 percent.

For telecom providers, there is a massive opportunity to leverage the cloud to help business customers transform contact centers into a strategic business asset that lowers operating costs and improves business performance. In the contact center, the cloud crossover will be further enabled by several benefits that differentiate the telecom provider offering, including seamless integration with unified communications capabilities, analytics-based routing, easier integration with cloud services such as Salesforce, and significantly more cost effective scalability and multi-site support.

 

Michael Blauer is Director Market Intelligence at BroadSoft, a global unified communications software as a services (UCaaS) provider.

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