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May 2021

IDC MarketScape: Worldwide UCaaS Service Providers for SMB 2021 Vendor Assessment

Denise Lund

Denise Lund

Research Director, WW Telecom and Unified Communication - IDC

Product Type:
IDC: MarketScape
This Excerpt features: Comcast
abstract data

Denise Lund

Research Director, WW Telecom and Unified Communication – IDC

IDC MarketScape: Worldwide UCaaS Service Providers For SMB, 2021

Capabilities Strategies Participants Contenders Major Players Leaders

Leaders

RingCentral

ComcastFeatured Vendor

8×8

Verizon

Zoom

AT&T

Major Players

Mitel

Vonage

Nextiva

Lumen

LogMeIn

DialPad

Fuze

Contenders

Windstream

Intrado

IDC MarketScape Methodology

IDC Opinion

The unified communications-as-a-service (UCaaS) service provider market continues to be crowded by vendors that are moving upmarket and downmarket to capture share of this rapidly growing space. For small and medium-sized businesses (SMBs), their operational needs are evolving as quickly as they are for enterprises. This requires UCaaS service providers to deliver base-level solutions that include a careful balance of integrated voice, messaging, chat, and meetings features. In addition, they must provide flexible tiered pricing as well as simplified implementation and training options. It is also important that the UCaaS service providers show the capacity to grow with their SMB customers as their needs evolve, such as with more sophisticated analytics and contact center capabilities and a strong vision for how the UCaaS solution fits within the broader unified communications and collaboration (UC&C) solution.

SMBs have faced enormous pressures as a result of the COVID-19 pandemic, resulting in heightened needs for solutions that drive productivity and collaboration among employees who work outside of the traditional four-walls of the office. UCaaS solutions can be a welcome respite for SMBs as they look to maintain business continuity and cost-effective operations. It helps if the solution is easy to use and does not burden overstretched management and technical support personnel in an SMB.

IDC defines a core UCaaS solution as a cloud-based integrated voice, messaging, and meeting services solution delivered via IP in the cloud and sold on a monthly recurring subscription basis. There are numerous service providers, including network carriers, cable companies, and over-the-top (OTT) service providers, that offer these solutions.

Key findings of this IDC MarketScape assessment include:

  • Overall UCaaS solution functionality varies, but many vendors’ solutions have a base-level set of integrated voice, video, messaging, and meeting services. Features in the base-level UCaaS tier not only vary between vendors but also vary significantly as the SMB buyer looks at higher-level UCaaS solution tiers across the market.
  • Differentiators include price, package composition, self-help implementation and support resources, mobile emphasis, and clear path for an SMB to have its needs met by that same vendor over time as its business changes.
  • Vendors’ vision of a positive user experience (UX) for SMBs is very different, ranging from simplified implementation services to easy-to-use streamlined features within the voice call and chat interface itself. Consumerized experiences are not yet table stakes in the UCaaS solution set being targeted to SMBs.

Tech Buyer Advice

When considering UCaaS solutions, SMB buyers must consider how a vendor’s solution augments and can easily become part of their employees’ daily way of working and doing business. Consider the UCaaS service providers’:

  • Base-level solution functionality. On the smaller end of SMBs are needs for entry-level UCaaS functionality at a good value. Solutions that offer the fundamentals of hosted and integrated cloud, messaging, and meeting capabilities in a bundle or package that is priced less than more full-featured solutions can be a good place for a smaller SMB to start with UCaaS. Alternatively, a full-featured solution available at an aggressive price point could be a reasonable option for SMBs, but only if the broader feature set does not slow implementation, as features such as large meeting capabilities and perhaps some included contact center capabilities are not a requirement.
  • User experience. A critical success factor for UCaaS in the SMB environment is an employee user experience that is straightforward and familiar, easy to use and, ultimately, does not require a significant amount of technical support. Many SMBs lack technical resources, particularly in small businesses, to support implementations and drive adoption if the UCaaS solution is too complex to deploy and use.
  • Standardized customer support programs for SMBs. Self-service tools and educational materials for SMBs are an attractive first step in the implementation process, along with easy-to-use administrator portals that can accommodate changes in the number of seats as SMB needs change. Having the option to add on more advanced, personal support and integration customization services is a good option for SMBs on the larger end of the segment to accommodate for how their business may change over time.
  • Demonstrated ability to deliver a UCaaS solution that fits with a broader set of UC&C elements. SMBs’ needs will change over time, and for many at the larger end of the segment, being able to tie their UCaaS solution into a broader UC&C offering will become a requirement. UCaaS vendors that have a clear vision for how their UCaaS solution integrates with other UC&C elements, including collaboration software and contact center as a service (CCaaS), can grow with the buyer’s organization when its needs expand.

Featured Vendor

This section briefly explains IDC’s key observations resulting in a vendor’s position in the IDC MarketScape. While every vendor is evaluated against each of the criteria outlined in the Appendix, the description here provides a summary of each vendor’s strengths and challenges.

Comcast

Comcast is positioned in the Leaders category of this IDC MarketScape for worldwide UCaaS service providers for SMB vendor assessment. Comcast is a cable services provider offering a broad range of digital solutions and communications services to residential and business customers. Comcast Business sells a variety of cloud-based solutions to business customers that are in its footprint. Its portfolio of two UCaaS solutions, Business VoiceEdge and Business VoiceEdge Select, has recently expanded to include Comcast’s 2020 acquisition, Blueface. Blueface is a multitenant UC platform that has features that are geared to enterprises, as well as an administrative interface that allows businesses to view and edit/manage their solution use and call flows. Business VoiceEdge and Business VoiceEdge Select are targeted largely at medium-sized businesses and small businesses, respectively. Business VoiceEdge is a full-featured UCaaS solution that includes a SIP gateway for most implementations, high-definition voice, and unified messaging, as well as standard integrations to major collaboration software and services commonly used in large organizations (i.e., Office 365, Skype for Business, Google Chrome, and Salesforce.com). There is a partner video solution add-on available. Business VoiceEdge comes with a service and feature management portal with role-based access from administrators in an organization to the end users, as well as optional endpoint devices, and a mobile app. Business VoiceEdge also includes an optional set of contact center capabilities, such as auto attendant. Business VoiceEdge Select is a scaled-down version of VoiceEdge targeted to small businesses, allowing for up to eight seats. It has an emphasis on mobility, devices, and the basics of integrated cloud-based voice and messaging.

Strengths

Comcast has a long history of delivering network services to small businesses, so understands their unique needs as a market segment. By adding VoiceEdge Select to the Comcast UCaaS portfolio in 2018, Comcast established itself as a one-stop shop for SMB communications and collaboration needs.

Challenges

SMB customers will have to keep the pressure on Comcast to continue to evolve the VoiceEdge Select user experience, as Comcast is faced with balancing upmarket needs and integration of its Blueface acquisition into its portfolio.

Consider Comcast When SMBs should consider Comcast when they currently use or plan to use Comcast for connectivity services and want to use a similarly knowledgeable SMB source for their UCaaS solution.

“SMBs need a service provider that can meet their communication requirements today, grow with them into the future, and deliver an exceptional user experience for employees, UCaaS solutions that offer a good value entry point are a good way for an SMB to begin the journey.”

Denise Lund, Research Director, WW Telecom and Unified Communication – IDC

Methodology

IDC MarketScape Vendor Inclusion Criteria

IDC included vendors based on the following key criteria:

  • The vendor sells a unified communications-as-a-service solution targeting SMBs as defined by IDC as having fewer than 1,000 employees. Note that vendors in this assessment also target large organizations.
  • The UCaaS solution meets IDC’s definition of UCaaS as integrated voice, video, messaging, and meeting services delivered via IP in the cloud and sold on a monthly recurring subscription basis.
  • The vendor is either a network carrier or a cable operator that sells cloud-based multitenant/multi-instance UCaaS offerings, or the vendor is an OTT UCaaS service provider.
  • The vendor has UCaaS revenue of $20+ million for calendar years 2019 and 2020. Owing to the timing of estimates provided, revenue may differ from market share in forthcoming IDC deliverables.

In addition to the companies profiled in this study, there are several other companies that IDC has included in its IDC MarketScape: Worldwide UCaaS Service Providers for Enterprise 2021 Vendor Assessment (IDC #US47452521, February 2021).

Reading an IDC MarketScape Graph

For the purposes of this analysis, IDC divided potential key measures for success into two primary categories: capabilities and strategies.

Positioning on the y-axis reflects the vendor’s current capabilities and menu of services and how well aligned the vendor is to customer needs. The capabilities category focuses on the capabilities of the company and product today, here and now. Under this category, IDC analysts will look at how well a vendor is building/delivering capabilities that enable it to execute its chosen strategy in the market.

Positioning on the x-axis, or strategies axis, indicates how well the vendor’s future strategy aligns with what customers will require in three to five years. The strategies category focuses on high-level decisions and underlying assumptions about offerings, customer segments, and business and go-to-market plans for the next three to five years.

The size of the individual vendor markers in the IDC MarketScape represents the market share of each individual vendor within the specific market segment being assessed.

IDC MarketScape Methodology

IDC MarketScape criteria selection, weightings, and vendor scores represent well-researched IDC judgment about the market and specific vendors. IDC analysts tailor the range of standard characteristics by which vendors are measured through structured discussions, surveys, and interviews with market leaders, participants, and end users. Market weightings are based on user interviews, buyer surveys, and the input of IDC experts in each market. IDC analysts base individual vendor scores, and ultimately vendor positions on the IDC MarketScape, on detailed surveys and interviews with the vendors, publicly available information, and end-user experiences in an effort to provide an accurate and consistent assessment of each vendor’s characteristics, behavior, and capability.

Market Definition

Small and Medium-Sized Businesses

In the Americas region, IDC defines small and medium-sized businesses (SMBs) as businesses with up to 999 employees.

Unified Communications as a Service

IDC defines UCaaS offerings as integrated voice, video, messaging, and meeting services delivered via IP in the cloud and sold on a monthly recurring subscription basis. UCaaS service providers and OTT UCaaS service providers make up the bulk of the market, with vendors from the infrastructure side filling in the balance. See IDC TechBrief: Unified Communications as a Service (IDC #US46748020, August 2020) for more information on the four segments of the UCaaS market and an overview of the two segments that make up the UCaaS service provider assessment in this document, namely, network carriers/cable operators with UCaaS solutions and OTT UCaaS service providers. These service provider segments are defined briefly in the sections that follow.

UCaaS Service Providers

These service providers are typically major global network carriers but may also be tiers 2 and 3 network carriers and cable operators that sell cloud-based multitenant/multi-instance UCaaS offerings. UCaaS service provider solutions are often based on a third party–enabling UCaaS platform that the providers sell directly to business buyers or sell indirectly through channel partners. The service provider upgrades, supports, operates, and manages the UCaaS platform either in its datacenter or in a partner’s datacenter. UCaaS service provider offerings are most often based on the carrier’s or operator’s global or regional network infrastructure, but some are based on an OTT UCaaS offering.

OTT UCaaS Service Providers

These UCaaS service providers use an existing broadband data connection as the foundation on which integrated UCaaS capabilities are layered.

Related Research

  • IDC MarketScape: Worldwide UCaaS Service Providers for Enterprise 2021 Vendor Assessment (IDC #US47452521, February 2021)
  • S. Enterprise Communications Services Survey, 2020: Hosted VoIP/UCaaS Adoption and Buying Criteria (IDC #US46938820, December 2020)
  • S. ECS Survey, 2020: Enterprise Investment Priorities (IDC #US46339220, December 2020)
  • S. Enterprise Communications Services Survey, 2020: Top-Line UC&C Results (IDC #US46372820, December 2020)
  • Direct Routing for Teams: More Than Just Cost Savings (IDC #US46938620, December 2020)
  • UCaaS Service Providers Market Overview (IDC #US46747220, August 2020)
  • IDC TechBrief: Unified Communications as a Service (IDC #US46748020, August 2020)
  • IDC Market Glance: Unified Communications and Collaboration, 1Q20 (IDC #US46094820, March 2020)

IDC MarketScape: Worldwide UCaaS Service Providers for SMB 2021 Vendor Assessment

This IDC study represents a vendor assessment of service providers offering unified communications as a service (UCaaS) for SMBs using the IDC MarketScape model. The assessment reviews both quantitative and qualitative characteristics that define current market demands and expected buyer needs for UCaaS solutions. The evaluation is based on a comprehensive and rigorous framework that assesses each vendor relative to one another, and the framework highlights the key factors that are expected to be the most significant for achieving success in this market over the short term and the long term.