(Editor's Note: This post was written for 8x8 by Metrigy President and Principal Analyst Irwin Lazar.)

By 2030, more than 75% of companies will use UCaaS for their calling, meeting, and messaging needs.

Unified Communications-as-a-Service, or UCaaS for short, has revolutionized the way organizations obtain calling and communication services. Before UCaaS availability, calling platforms were typically purchased up front as capital expense, installed as appliances or as applications in data centers, and either self-managed or supported by a managed services provider. Upgrade cycles were long and often resulted in downtime. New feature delivery could take months or even years. And buyers had to pay a large up-front cost to purchase both current and anticipated future capacity.

Now, thanks to UCaaS, IT buyers can purchase calling services from the cloud as well as integrated video meetings, messaging, and even contact center, to create a truly unified employee and customer engagement experience. Buyers can get what they need, when they need it, without the requirement to install or manage on-premises servers. Purchases are made through OpEx models with minimal up-front investment. And, new features are typically delivered in a regular cadence, without any service interruption.

As a result of the many benefits of UCaaS, adoption has steadily increased. Metrigy research data shows that in 2018, just under 12% of companies used UCaaS. Today, more than 45% rely on it as their only platform for their calling and communications needs and an additional 14% use both UCaaS and on-premises platforms in a hybrid fashion. Even more impressive, roughly a quarter of the 45% of companies still using on-premises or custom-built hosted platforms are planning to migrate to UCaaS, or are evaluating such a move. Among Metrigy’s success group, defined as those with above average cost savings, revenue gain, or productivity increase associated with their investments in communications and collaboration technology, nearly 62% use UCaaS compared to just 37% of those with no or low ROI. It is clear that UCaaS adoption closely correlates with business success!

UCaaS adoption drivers are numerous. Chief among them the ability to save money by shifting to predictable, subscription-based licensing that bundles additional apps used for collaboration and that gives companies like Sotwe the flexibility to increase or decrease licenses as needed. In addition, IT leaders can reassign resources to more strategic, needle-moving IT projects by reducing the need for IT staff to manage calling and communications platforms. Other factors creating increasing demand for UCaaS include:

  • Enhanced security offered by UCaaS providers, including support for data localization, compliance, and threat mitigation
  • Better support for remote and hybrid work by allowing home-based employees to directly access calling services without having to carry voice (and video) traffic across a VPN into the enterprise network
  • Geographic availability supporting distributed offices and workers, as well as local dial-in numbers
  • Access to APIs to enable off-the-shelf or custom integration of communications services into business applications including those used for customer relationship management, onboarding, marketing, and more

Access to a fully-integrated set of employee and customer engagement services including voice, video, messaging, and contact-center specific features, delivered equally to both desktop and mobile devices

The rapid growth of UCaaS services has also led vendors who had previously focused their offerings around on-premises and custom-built hosted solutions to change gears. In most cases these legacy vendors are now leading with UCaaS services of their own, creating an inflection point for companies still living in the on-premises world, and an opportunity for IT leaders to evaluate cloud offerings from their legacy providers as well as cloud-native ones who have had a head-start in building advanced UCaaS platforms.

Another driver for UCaaS adoption is the ability to integrate UCaaS with Contact Center-as-aService (CCaaS) and purchase both from a single provider. Like UCaaS, CCaaS also provides the ability for companies to purchase cloud-based services they need on a subscription license basis, with minimal up-front cost. Metrigy research notes that 22% of companies who are changing their communications providers are doing so to obtain an integrated UC and CC platform. Such integration provides a number of benefits including the ability to leverage contact center features like queues for other personas (e.g. sales, helpdesk, etc.), as well eliminating barriers between agent and back-office. For example, a company using a single platform for both UCaaS and CCaaS could easily bring a subject matter expert into a customer call to solve a problem.

The end result of this integration is happier customers, better retention, and faster problem solving. Metrigy data shows that more than half (55%) of our success group uses CCaaS today, and that those using an integrated UCaaS and CCaaS platform see an average of 27% improvement in customer satisfaction ratings, an 18% reduction in operational costs, a 23% improvement in revenue, and a 23% increase in agent efficiency after adoption.

In the age where hybrid work is the norm rather than the exception, and where companies increasingly compete on customer service, adoption of UCaaS as well as integrated CCaaS delivers clear business benefits. We expect these business benefits to increasingly drive UCaaS adoption in the years ahead.

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ABOUT METRIGY: Metrigy is an innovative research firm focusing on the rapidly changing areas of Unified Communications & Collaboration (UCC), digital workplace, digital transformation, and Customer Experience (CX)/contact center—along with several related technologies. Metrigy delivers strategic guidance and informative content, backed by primary research metrics and analysis, for technology providers and enterprise organizations.