Global Unified Communication as a Service Market Grows at a Staggering CAGR of 19.05%

Introduction

Unified Communication as a Service (UCaaS) is a cloud-based infrastructure that offers various communication services and processes, such as voice telephony, messaging, conferencing, and communication-enabled processes. Voice Telephony consists of cloud-based private branch exchange (PBX) and audio over internet protocol (VoIP) (VoIP). Included in messaging are voicemails, faxes, and messages. Conferencing consists of web, audio, and video conferencing. Communication-enabled processes permit integration with various business applications, including contact centers. It also enables users to share files and integrates readily with other business applications, including Customer Relationship Management (CRM). Therefore, UCaaS enables employees to communicate and share information with various teams and customers, regardless of their location or department, in a structured and consistent manner.'

Market Dynamics

Lower Total Cost of Ownership (TCO) drives the Global Market

Traditional UC systems are becoming increasingly costly for businesses, particularly in light of the emergence of UCaaS solutions. On-premises installation of phone systems is not only costly in terms of initial purchases and installation fees but also necessitates hiring a person to manage phone systems, which can cost businesses more than USD 55,000 annually. In order to deploy on-premises UC, businesses must incur substantial upfront and ongoing costs. Budget-constrained small businesses cannot afford to invest in unified communication systems at such a high cost.

Reduced Total Cost of Ownership is the primary factor propelling market demand for UCaaS. UCaaS is gaining popularity because it eliminates the need for businesses to rely on multiple vendors for various communication channels. Users can access all communication systems from a single platform, removing the need to transition between applications. UCaaS also enables businesses to adopt a pay-as-you-go model, allowing users to pay per consumption. As a result, UCaaS helps businesses save money on capital expenditure (CAPEX) and operating expenditure (OPEX), fostering market expansion.

Growing Trend of Bring Your Own Device Creates Tremendous Opportunities

Bring Your Own Device (BYOD) is getting popular and encouraging organizations to adopt UCaaS solutions. In the current competitive environment, organizations must be highly adaptable and provide employees with mobility to be productive and stay ahead of the competition. Consequently, businesses around the world are employing the BYOD trend. Supporting BYOD trends, UCaaS providers are increasingly developing infrastructure by incorporating applications such as Managed Mobility Services (MMS) and enterprise social media. This is anticipated to contribute to the expansion of UCaaS in the market. Organizations that adopt the BYOD policy save more than USD 300 per employee annually. A portable device saves an employee approximately one hour daily and increases productivity by more than 30 percent. Numerous organizations are adopting BYOD, which is expected to create growth opportunities for the UCaaS market over the forecast period.

Regional Analysis

North America is the most significant global unified communication as a service market shareholder and is estimated to exhibit a CAGR of 16.96% during the forecast period. Countries like the United States and Canada are home to numerous multinational corporations with significant employee bases. This necessitates platforms facilitating communication and bringing together all employees, increasing the demand for UCaaS solutions. The region is a pioneer in the adoption of numerous new technologies. In addition, continuous innovation and development of new technologies, coupled with widespread acceptance, accelerate the expansion of regional industries. This sustained expansion of industries is anticipated to increase demand for UCaaS during the forecast period. The utilization of UCaaS is not limited to any particular organization or industry. Instead, it is applicable across industries. The healthcare industry is deploying UCaaS to communicate with multiple doctors, nurses, and patients and instantly share data. Thus, the demand for UCaaS in the healthcare industry is expanding.

Europe is anticipated to exhibit a CAGR of 17.81% over the forecast period. Due to several large corporations such as Volkswagen, Daimler, EXOR Group, Allianz, and Prudential, Europe accounted for the second-highest share. These businesses rely on UC solutions for various important reasons, including a large employee base, increased productivity, and improved business processes, bolstering the regional UCaaS market. France, Spain, Italy, and Germany are the most popular tourist destinations worldwide, generating significant annual tourism. This also strengthens the hospitality industry in Europe, which includes many national and international actors. The ever-expanding hospitality industry is anticipated to increase demand for UC to enhance operational convenience and adaptability. Therefore, this will likely contribute to developing the UCaaS market in Europe.

Key Highlights

• The global unified communication as a service market was valued at USD 42.97 billion in 2022. It is estimated to reach USD 206.55 billion by 2031, growing at a CAGR of 19.05% during the forecast period (2023–2031).
• Based on components, the global unified communication as a service market is bifurcated into telephony, conferencing, and unified messaging. The telephony segment dominates the global market and is projected to exhibit a CAGR of 16.79% over the forecast period.
• Based on organization size, the global unified communication as a service market is bifurcated into large enterprises and small and medium enterprises. The large enterprise segment owns the highest market share and is predicted to exhibit a CAGR of 18.06% over the forecast period.
• Based on industry verticals, the global unified communication as a service market is divided into telecom and IT, healthcare, BFSI, retail and consumer goods, education, transportation and logistics, and travel and hospitality. The telecom and IT segment is the most significant contributor to the market and is anticipated to exhibit a CAGR of 14.90% over the forecast period.
• North America is the most significant global unified communication as a service market shareholder and is estimated to exhibit a CAGR of 16.96% during the forecast period.

Competitive Players

Competitive Players

The key global unified communication as a service market players are RingCentral, Mitel, 8×8, LogMeIn, Cisco, Fuze, Google, Microsoft, Vonage, Alcatel Lucent Enterprise, Cloud Connect, Digerati Technologies, Dialpad, Intrado, Masergy, Nextiva, NTT Communications, Orange SA, Starblue, Revation Systems, and others.

Recent Developments

Market News

• In January 2023, Atos, a global digital transformation leader, got engaged in exclusive negotiations with Mitel Networks to sell its Unified Communications & Collaboration Services businesses.
• In April 2023, CallTower incorporated Zoom Phone into its suite of UCaaS offerings. Integrating Zoom Phone with CallTower's contact center and communications solutions enables CallTower clients to consolidate multiple business phone systems onto a unified platform.

Segmentation

Global Unified Communication as a Service Market: Segmentation

By Component

• Telephony
• Conferencing
• Unified Messaging

By Organization Size

• Large Enterprises
• Small and Medium Enterprises

By Industry Vertical

• Telecom and IT
• Healthcare
• Banking, Financial Services, and Insurance
• Retail and Consumer Goods
• Education
• Transportation and Logistics
• Travel and Hospitality

By Regions

• North America
• Europe
• Asia-Pacific
• Latin America
• The Middle East and Africa