CounterPath: The Biggest Threats to VoIP Providers in 2020 – Part 1

If you were to ask a hosted VoIP/ITSP what the biggest threat to their business is in 2020 you would probably see some common answers:

  • Large carriers that spend ridiculous money on marketing
  • Increasing customer churn
  • Being viewed more like a commodity than a valued service

And to be fair, those are all very valid and trends we have seen for a few years now. But they pale in comparison to the sleeping giant that many VoIP providers are only just now realizing has had prolonged exposure to much of their customer base.

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The number one threat facing VoIP providers in 2020 is a brand new breed of competition that has cemented themselves as a sticky solution, a service that quickly becomes integral to business processes and workflows, a product that their local VoIP provider typically doesn’t offer. This new breed of competition is now realizing that these customers (also your customers) they have been aggressively onboarding also have a valuable voice business that up until now has been left relatively untouched.

With collaboration software providers beginning to see their subscriber levels plateau, they are looking to continue their momentum by targeting a whole new revenue stream – the hosted voice component. Zoom, Microsoft, Google, household names in 2020 are all offering hosted voice services and are beginning the aggressive push to convert their customers to an all-in-one solution that aims to take the hosted PBX and voice carriage away from the VoIP provider.

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Many VoIP providers do not have a collaboration solution and until now have seen no harm in allowing their customers to sign up for services like Zoom and Microsoft Teams directly. For a lot of these customers this was not a product they saw as necessary to remain competitive or help them win the voice business. Some even viewed it as a burden, something that would take too much time and effort to productize for too little margin – something that has been proven to be false, as the average Collaboration seat in 2020 is going for $XX per user (add source etc), with no hosted voice/PBX service included.

We have started to hear from smaller VoIP providers through to large wholesalers with extensive partner networks, and all across the globe they are noticing customers churn away to Microsoft, Google, Zoom, and others. Their customers see significant value in collaboration and video conferencing solutions, and  the hosted voice business is something they are more than prepared to give away to a valued vendor that can provide the complete service they are looking for, and if that vendor happens to be a huge household name – it makes their decision that much easier.

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This will not be a short-term trend and the pressure on VoIP providers will only increase as the competition in this space continues to heat up amongst these large collaboration software providers. VoIP providers must act now and acknowledge this new threat in order to adapt and keep their customers.

This is just part 1 in a series of posts designed to help VoIP providers combat this new threat. Part 2 will outline the steps they can take and changes they can make, and the advantages they have over the likes of Google, Zoom and Microsoft.

Learn More About CounterPath Solutions for Service Providers

Sourced from: Counterpath. View the original article here.

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