Cloud Business Communications Growing By 23% Per Year
RingCentral leads the pack.
New Q1 data from Synergy Research Group shows that the cloud business communications market is growing at an annualized rate of 23%, as strong UCaaS adoption continues to drive the market. Retail UCaaS services account for well over 70% of the total market, though the smaller wholesale UCaaS segment is growing considerably more strongly. The balance of the market comprises cloud communications (virtualized call control and UC applications), which are growing at a similar rate to retail UCaaS. The total cloud communication market is now generating revenues in excess of $2 billion per year. RingCentral is the market leader based on quarterly revenues and has been consistently growing its market share, thanks to leadership of retail UCaaS and a strong position in wholesale UCaaS. It is followed by 8x8, Mitel and ShoreTel.
Retail and wholesale UCaaS business suite services now generate revenue of well over $1.7 billion on an annualized basis. These include private, public and hybrid cloud service offerings. Public UCaaS is the largest of the three sub-segments and is also growing the most rapidly. Overall the cloud business communications market continues to be heavily concentrated in the United States, which accounted for 80% of total revenues in the first quarter of the year.
“UCaaS continues to be a force for change within the business communications market,” said Jeremy Duke, Synergy Research Group’s founder and chief analyst. “Major barriers to cloud adoption are now almost a thing of the past and consequently we are seeing continued erosion of on-premises PBX-based systems. Clearly these trends will continue over the next few years.”