Cloud PBX, or Private Branch Exchange, operates through an internet connection connecting IP phones to PBX servers. This method replaces conventional phone line systems. Cloud VoIP and PBX is a cheaper and more flexible business solution. As your business grow, Cloud PBX grows with you. A cloud VoIP and PBX system, like other cloud software, is hosted on a cloud server and can be accessed from anywhere with internet access. This is a popular choice for companies with stable network connections.
UC&C Market Expansion and Trends:
In terms of volume, the UC&C market expanded by 7.7 percent during 1Q23, with a remarkable count of 587.6 million units, lines, licenses, or seats. However, the market faced downward pricing pressure per unit sale.
Shifting Business Investments:
Jitesh Gera, research manager for Unified Communications and Collaboration at IDC, points out that businesses are actively investing in cloud-based UC Collaboration and UCaaS solutions while moving away from traditional hardware-based, premise-based IP PBX/UC systems. This shift towards cloud-based approaches, coupled with AI capabilities, allows enterprises to achieve quick and cost-effective value delivery.
The Impact of CPaaS:
The Communications Platform as a Service (CPaaS) market witnessed a revenue increase of 10.2 percent. However, economic uncertainty and an elongated sales cycle led to a sequential decline of 3.5 percent to $3.6 billion in 1Q23. Key segments of CPaaS, including messaging, voice, video, and email, contributed to revenue growth, with messaging accounting for the largest share at 67 percent, followed by voice at 15 percent. CPaaS revenues are projected to continue growing in 2023, reaching $15.7 billion with a year-over-year increase of 13.3 percent.
UC&C Vendor Landscape:
Microsoft dominates the UC&C vendor landscape, experiencing a 22 percent revenue increase to $6.6 billion in 1Q23, expanding its market share to 42.6 percent. Zoom, on the other hand, witnessed a 1.8 percent revenue growth, surpassing Cisco to secure the second-place spot with a market share of 6.8 percent. Cisco faced a significant decline of 16.1 percent in its 1Q23 UC&C revenues, resulting in a market share drop to 5.9 percent.
CPaaS Vendor Analysis:
Among CPaaS vendors, Twilio, Sinch, and Infobip collectively accounted for nearly half of the CPaaS revenues in 1Q23. However, the market is witnessing rapid changes, with smaller players exhibiting remarkable growth rates. Route Mobile achieved an impressive growth rate of 48 percent, while Vonage also experienced above-average market growth in the last quarter. Twilio secured a 23.4 percent market share, generating $847 million in revenue, while Sinch faced a 4.4 percent revenue decline and a decrease in market share.
Conclusion
The UC&C market is witnessing remarkable growth, driven by the adoption of cloud-based solutions and UCaaS, while traditional hardware-based systems are being phased out. As Microsoft maintains its dominance and Zoom overtakes Cisco, the UC&C landscape is evolving. The CPaaS market also shows promising growth, with Twilio leading the pack. As the industry continues to transform, businesses need to stay agile and adapt to these emerging trends to maximize their outcomes in the dynamic world of unified communications and collaboration.
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