As our CEO Steve Kokinos takes the stage for a keynote panel session at the UC Expo in London [tomorrow], we caught up with him to discuss the future of the UCaaS market and hear about his predictions for cloud communications. Below is a sneak peek into what we can expect from the panel.
The name of the panel you’ll be participating in is “[The] Future of Cloud Communications.” Give us a teaser – what are your predictions for the future of the UCaaS market, in the short term and more long term?
In the short term the action will all be centered on UCaaS vendors working to complete their product portfolios. A complete UCaaS portfolio consists of delivering enterprise voice, video and web collaboration, messaging, and contact center all on a single cloud platform. Historically, these areas have been considered discrete markets with discrete vendors servicing them. But it is clear that the near term future of UCaaS involves combining these functions, which leads to a better end user experience. It will become increasingly difficult to remain focused on any one of these areas, and the lion’s share of the market will migrate to vendors that are able to assemble complete portfolios.
In the longer term, the value that UCaaS vendors will be able to deliver will have to go beyond the converged communications features described above. Being able to provide data-driven insights for end users and managers will be a key differentiator. Communications and interaction data is some of the most valuable data generated in the enterprise, but it too often remains locked away in proprietary systems and thus unused. Big data and machine learning technologies combined with IaaS and PaaS services, such as AWS, provide the necessary ingredients to create data insights products that simply weren’t possible five years ago unless you were Google. For example, looking at the recent communications of a sales rep, and being able to offer suggestions on what they should do next to maximize their chances of closing a deal.
The market has grown substantially in the past few years: what does that say about technology trends in general? Why now? What conditions have made now a good time for UCaaS to take off?
UCaaS market growth and adoption is being driven by several factors. First, just like many other market segments, moving enterprise communications to the cloud decreases IT complexity, improves service uptime, and helps realize ROI. These are all market drivers for cloud adoption in general and apply to UCaaS. But second and specific to UCaaS, technologies for transporting voice and video over data networks (e.g., VoIP, WebRTC, plentiful bandwidth) are now widely available technologies, which remove technical barriers to adoption. These factors set the stage for a substantial shift from on-premise to cloud in the UC space over the next several years.
You might ask: given these drivers, why isn’t this shift happening faster? Part of the answer lies in the fact that existing premise-based systems are limited, but they are at the same time reliable, mature technologies. I liken them to the old tube TV I used to have in the basement. Yes, it only shows SD. Yes, it weighs 500 pounds and takes up half the room. But it’s a mature and reliable technology that will continue to work for some time even after its features are dated. So I think a lot of people end up waiting until the tube TV dies before replacing it with a more modern, flat panel LED.
Is there ever a “right time” to invest in cloud communications? Or should companies be focused on not when but how to take the plunge?
If you accept the argument that UC convergence is happening as described above, you will have to adopt a cloud UC service sooner or later. When to adopt may be driven by timing of your last PBX purchase, but many customers Fuze works with focus more on the ROI and the efficiency and productivity improvements that can be achieved. Even with a relatively new on-premise system, the ROI and productivity improvements can still be substantial and justify the move.
How to adopt cloud UC is totally different depending on the type of your enterprise. A relatively lightweight self-service model probably makes the most sense for single-location SMBs without complicated requirements. But large, multi-location enterprises with more complicated requirements will want to have the vendor provide a multi-disciplinary services team that engages, creates a project plan, and manages the migration of UC services to the cloud.
How do you expect technology will innovate to be increasingly mobile, well suited for cloud?
Other than cloud, mobility is the biggest market force at work in the UC space. It turns out that cloud is uniquely well suited to handle mobility requirements. The reason is that on-premise PBX technology was conceived of in a pre-mobile, pre-iPhone era. The idea was that you were providing communications services to a group of users at a particular physical location. User handsets at that location would be physically connected by a wire to the PBX system. There have been updates and changes to PBXes over the years, but they still fundamentally provide service on a location-by-location basis.
This model does not fit well with mobile, which is essentially location-less. Your mobile device works equally well at the office, in the car, or at home. The cloud is similar to mobile in that it is location-less. Having your mobile devices connect to the cloud versus connect back to a specific corporate PBX makes much more sense. The cloud can have multiple redundant points of presence and serve users connecting over mechanisms such as private MPLS, broadband, carrier LTE, etc.
Companies still have reservations about cloud communications surrounding cost, interoperability, and security. What do you say to critics?
We are well past the early adopter phase of UCaaS. As a result, we have many enterprise customers as reference points that have already gone through the migration from premise-based systems to our cloud service. There are documented ROI and other case studies that validate business objectives being achieved. Sometimes the best way to get comfortable with a technology is to talk to peers in your industry who have gone through this process and hear from them what they were able to achieve as a result.