Cloud Comms Market Competition Heating Up

Opportunity is everywhere in today's cloud space

4
Cloud Comms Summit Washington
Unified Communications

Published: September 19, 2019

Rob Scott

Rob Scott

Publisher

I recently returned from the Cloud Comms Summit hosted by the Cavell Group this year. I was attending the North American leg of the summit series, in Washington, USA, and during my time at the event, I had an opportunity to pick up on some interesting trends and insights into the changing nature of the cloud communications space.

Notably, the Cloud Comms Summit is becoming a very significant event in the industry, but it’s grown at a far more significant rate than usual over the last year – almost doubling in size. With a focus on the evolving service provider community, the Cloud Comms Summit attracted not just attendees from the North American area, but also people from all across the globe. It seems like cloud leaders are turning to the Cloud Comms Summit for advice and opportunities.

Here are my thoughts on the major trends from this year’s event.

Build-Your-Own Platform Grows More Popular

The first thing I noticed at this year’s Cloud Comms Summit is the growing demand for a build-your-own approach to platforms. For years, service providers have had the option to take platforms from leading providers like BroadSoft (now Cisco) Asterisk, 2600Hz, NetSapiens. However, this year, the Cloud Communications Alliance (CCA) pointed out that the most popular platform build of all was the self-build option. This was a big surprise to me, as I assumed the leading choice would have been BroadSoft, given the brand’s reach and sizeable network.

I found myself wondering whether this build-your-own approach was the best route forward for today’s agile service providers. After all, in terms of speed-to-market, there are some challenges involved in developing your own platform. If you’re going to compete against bigger players like Cisco/BroadSoft, and Microsoft, you may not have the time required to develop the right solution from scratch. Additionally, building a platform also requires a lot of resources in terms of software developers, professional services, and so on.

In an age where the communications space is moving at such a rapid pace, I’m not sure whether the marketplace has enough time to invest in building new platforms from the ground up. The marketplace is moving fast, and if you don’t have a full suite of UC solutions straight away, you could miss out on business opportunities to the full-portfolio players.

The Rise of the Multi-Vendor Approach

Another point I noted was that a lot of today’s service providers were building out from their core call control platform with new solutions from multiple vendors. There were a lot of SaaS and application vendors at the event that were able to deliver things like CPaaS, SIP trunking, APIs, CRM integrations, headsets, call analytics, and endpoints to SPs. It’s a really interesting market to be in right now. Service providers will need to think carefully about the approach that they want to take in their go-to-market strategy.

Is the right route forward to commit to a full-stack offering from a vendor that can provide everything, or is it better to take that multi-vendor pick-and-mix approach? There are a lot of other decisions to make too, such as whether you want to take your solution straight to customers or build out a channel to help you manage your sales. One of the critical pieces of advice given by the speakers this year was for service providers to focus on building a specialist sales channel, with a specific focus on unique things like vertical market opportunities.

There was even a growing demand evident for things like Salesforce. If you find an application that has millions of customers like Salesforce, then you can easily differentiate yourself just by showing customers how well your solution can integrate with that service.

Some businesses were even discussing the rising trend of premium vs freemium, and the habit of companies offering their customers free versions of software to help capture their attention and drive opportunities for up-selling and cross-selling. A lot of video collaboration companies like Slack and Zoom are looking at this kind of strategy now, offering free or low-cost applications to acquire new customers with cross-selling strategies. I think this will be an important area to watch going forward.

Adjacent Markets and Valuations

Cloud Communications AllianceAnother takeaway that I brought home with me from this year’s Cloud Comms Summit, was the fact that there are more adjacent markets coming into the communication space than ever before. We’re seeing that cloud communications aren’t just for traditional cloud vendors anymore. CRM vendors, collaboration brands, and others are all selling UC and call control solutions too. There are a lot of corresponding markets looking at the contact centre, collaboration, and UC markets to add further value to their existing portfolio.

In recent years, we’ve seen companies like Zendesk develop an entire contact centre with multi-channel functionality within their helpdesk software. When you have solutions like that, you don’t need a conventional contact centre at all.

Last but not least, valuations was also a hot topic at this year’s event. There’s a lot of successful service providers in the marketplace right now, and there’s still a lot of space for other companies to come and get involved too. There are some genuinely huge valuations out there today, including up and beyond 6 times revenue. Companies interested in getting involved in the communications landscape couldn’t ask for a better time to get started. The cloud communications market can easily be onboarded by a lot of different companies, which means it’s beginning to look more and more like an IT channel.

Service providers need to be aware of how much competition there is in this space before they dive in, but for the bold and brave there is huge opportunity.

Interested in attending the Cloud Comms Summit Roadshow? Visit the official site for their October and November in Paris, Madrid and Germany.

CRMService ProviderSIPUCaaS
Featured

Share This Post