March 27, 2020
It’s a remarkable time to be a unified communications (UC)/unified communications-as-a-service (UCaaS) provider as the coronavirus pandemic has created astronomical demand for remote workplace solutions virtually overnight.
Jay McBain, Forrester’s principal analyst of channel partnerships and alliances, said this week’s numbers alone are staggering:
Forrester’s Jay McBain
“The UCaaS channel seems to be keeping up [with] the demand and offering implementations/integrations at a scale never before seen,” McBain said. “We will start to see ‘client triage’ move into other communication and collaboration projects, clients accelerating critical UCaaS functionality to the cloud, automation opportunities, security, redundancy, managed services and business consulting.”
On the negative side, IT services will be impacted significantly if this is prolonged and creates a 2008-level scenario, he said.
We recently compiled a list of 20 top UCaaS providers offering products and services via channel partners.
“We could see upward of a quarter of the channel struggle to survive if capital markets freeze, large customers delay accounts payable and demand drops for key services,” McBain said.
One of the biggest challenges is on the HR side as finding and retaining staff is the largest issue for many in the channel and if companies are forced to furlough or lay off employees, they may not come back, choosing a safer, larger company environment upon their return, he said.
Raul Castanon, senior analyst of workforce collaboration for 451 Research/S&P Global Market Intelligence, tells us many vendors have stepped up to help organizations support the unexpected rise in employees working from home.
451 Research’s Raul Castanon
“A few that stand out are 8×8, [which] developed a business readiness kit for remote work, CafeX Communications, which made its recently announced enterprise collaboration application Challo free to use until the summer; Dialpad, which is offering Dialpad Pro and UberConference for free to enable users to seamlessly work remotely; Intermedia, which is offering AnyMeeting Pro for free through the end of year, and many more,” he said. “It is still too early to gauge how this will translate into an increase in paid accounts, users and usage, or cost of new business; however, I expect it will likely benefit vendors in the long run as the outbreak will serve as a catalyst that will accelerate several trends that have been building up over the past few years, such as remote working and flexible work arrangements. These trends are now ‘business as usual’ for high-tech, digital-native companies, but were becoming more widespread among other organizations.”
The outbreak will put vendors to the test and will place the spotlight on key capabilities that are critical for supporting a distributed workforce — namely security, reliability and compliance, Castanon said. An interesting case is LoopUp, which has a differentiated approach to conferencing, he said.
“The company runs all audio on the public switched telephone network (PSTN) – even for video conferencing – which makes it a very reliable solution compared to VoIP,” he said. “It is also well suited for secure external collaboration. This places it in a good position to gain market traction since its key capabilities align well to address the requirements that many organizations will have as a result of the pandemic.”
Other vendors such as …
… Zoom and Cisco Webex are investing heavily to expand capacity and support the increase in demand, Castanon said. Some have their own infrastructure and others rely on a third party, and this will influence their capacity to respond, he said.
“Cisco, for example, is in a good position with its own infrastructure, but is having to invest heavily,” he said. “Others like Mitel will likely be able to prove the benefits of their partnership with AWS and the Amazon Chime SDK. When it comes to security, it will also be testing ground for Challo … which will be able to showcase the benefits of secure external collaboration.”
These are no doubt tough times for UC/UCaaS vendors, Castanon said. On one hand, even though it is an opportunity to expand their market footprint, it will put their capacity to the test and they will have to invest heavily, but may not see the benefits until much later, he said.
“Furthermore, the spike in usage is made up largely of freemium users and only a small percentage will convert to paid customers,” he said. “Not all vendors will be able to sustain an unexpected increase in demand without the corresponding revenue for too long. If this situation extends through the end of the year, it could lead to market consolidation and a smaller number of vendors.”
Rick Beckers, CEO of XaaS1, said Zoom and other video conferencing UC vendors are “killing it,” and they are all “as-a-service” subscription-based vendors.
XaaS1’s Rick Beckers
“Many hosted telephony vendors started out on the desktop with a handset and added other forms of communication,” he said. “They added cellphone integration and twinning that allowed people to get away from their desk. They added softphones, they added video conferencing [and] SMS integration. And the feature set became a true UC stack. And that freed us up for communication from anywhere on any device, which allowed us to do business anytime and anywhere. Fast-forward to today’s pandemic work-from-home national emergency and thank goodness we had these capabilities. The vendors that are excelling are those that are unhinged from the desktop phone, though. I think the handset is shrinking in importance because it’s mostly singular in its function. The UC goliaths of tomorrow are software-driven and device-agnostic.”
Software-driven vendors are going to continue to skyrocket to success, and there may be some new players in the marketplace because handset hardware won’t hold them back in the channel, Beckers said. The current environment has clearly shown that software-based UC solutions are fast, flexible and unified, he said.
“It is a fantastic time to be a UCaaS provider,” he said. “Some will face unprecedented challenges. Some will have growth issues that may impact their customer service image for some time. Others will rise to the occasion, and deliver products and services that may make such an impact on the public that their names could become synonymous with the work-at-home act or an acronym with more of a hook. I guess we’ll have to wait and see how it shakes out. I doubt I’m going to ‘UCaaS’ you. Are you going to ‘Zoom’ me? All I know is that it makes me want to go do domain searches for something snappy.”
Jon Arnold, principal analyst at J Arnold & Associates, said it may be too early to talk about providers gaining new customers, because first and foremost it’s about stepping up to support their existing customers because …
… they’re the ones on the front lines of the business.
Arnold & Associates’ Jon Arnold
“There are all these variations of free and trial periods to get customers … but anything that drives adoption is good,” he said. “The big challenge for any of these players is getting the end users to use it. So now there’s people sitting at home all day and this is what they’re going to need now.”
For the providers that don’t have big installed enterprise customer bases and mostly work off of a cloud-based model with a lot of free offers, this is a “golden opportunity for them to have their moment and get it in the hands of people, so it could be a really good thing for them, Arnold said.
“To be a Cisco customer, for example, or a Microsoft customer in an enterprise, you’re not just buying video conferencing, it’s just an application in a much bigger suite of offerings — hardware, software, whatever,” he said. “But when you’re signing up with Zoom or BlueJeans or Slack, any of these point-solution players or cloud-based players; that’s all you need to do. You just sign up and you get it.”
What remains to be seen is whether this high usage stays or dies down after the free trials expire, Arnold said. In addition, there could be broadband issues, he said.
“Does your network have the bandwidth to support it all?” Arnold said. “Does the internet backbone have enough in it to have this new way of using the internet? I’m sure there are huge stresses on the network at 8 a.m. when everyone’s talking on it at the same time, so that is a consideration for sure.”
This could be the best thing that ever happens to UC, Arnold said. It’s the perfect storm because there is no better use case imaginable then overnight having to have so much of your workforce required to work from home, he said.
“I mean, you couldn’t cook up a better scenario,” he said. “No vendor has that kind of clout to force people to use their products, right? This is exactly what UC was invented for, and here you go now, you thrust all these millions of people in front of their PCs at home and they’re going to have to figure it out, and these are the tools that they really do need to work from home. So it’s like right place at the right time in a way.”
Vonage Rolls Out Remote Environment Solutions for COVID-19 Response
Vonage has unveiled several free offers for organizations that need to operate in remote environments during the COVID-19 crisis. Its solutions enable telehealth engagements for health care professionals and online learning environments for educators, as well as connections with customers, collaboration with colleagues, and the ability to connect contact center agents with customers from any location.
Vonage’s Mario DeRiggi
To find out more about how Vonage is responding to the pandemic, we spoke with Mario DeRiggi, senior vice president of channel sales.
Channel Partners: Will these new solutions provide opportunities for Vonage’s partners? If so, can you give some examples?
Mario DeRiggi: One of the goals of developing these solutions was to help our partners and their customers navigate through this crisis. Our partners are the trusted advisers for the customers they serve. As enterprise organizations adjust to the current environment, they will seek the advice of …
… the partner community to assist them with solutions to help them keep their businesses up and running. The Vonage solutions that enable a remote workforce can help our partners assist enterprises with applications that can be quickly implemented to keep their workforce productive and engaged.
CP: What is Vonage hearing from its partners in terms of their customers’ needs during the pandemic?
MD: The immediate need partners are hearing from customers is how to move to a remote workforce environment quickly. Many enterprise organizations do not have the infrastructure set up. The partner community is being tasked with not only bringing the solutions to the customer quickly, but to assist in the implementation. There are also many organizations that had the technology, but not the processes to quickly implement remote work on a large scale. Many of these organizations are turning to the partner community to support these transitions, and we’re here to support our partners and end customers.
CP: Is security addressed in these new solutions? If so, how?
MD: Given the large-scale remote work situation globally, there is a heightened concern around security in the industry. For these new offerings, it is also important to balance ease of use while providing practical security protection. These offerings will also be regularly tested and monitored for security in line with the industry’s best security practices.
CP: Is part of the goal with these new solutions to establish long-term relationships with customers?
MD: We are working with our customers and partners during these challenging times to not only provide guidance on how they can quickly and easily set up their remote workforce to ensure business continuity remains strong, but to also help them adjust to how business is changing. By helping them to best leverage their Vonage service, our hope is that they will be ready for their office to be anywhere.
Wildix Answers Call for Remote Workspaces
Wildix is offering six months of free chat and video conferencing in response to the pandemic.
Wildix’s Smart Working package lets users begin working from home immediately with no software installation or on-site technicians required. The platform configures itself to enable smart working from a living room or home office.
This solution will give users access to all of the features of Wildix Collaboration (audio/visual call, chat, conferencing, screen sharing and file transfer, etc.), plus videoconferencing.
Wildix’s Steve Osler
“Employers and companies have an obligation to protect their workers’ health at all times, but all the more so during this dramatic period for global health,” said Steve Osler, Wildix‘s CEO. “At Wildix, we are all working from home – smart working – thanks to our solution. I invite all workers who can perform their roles from home to start doing so immediately, without waiting even one day. To do this, we need browser-based technology that is easy to use, quick to activate and works on users’ personal devices.”
Additionally, its Vision and Supervision phones work through a simple Wi-Fi connection. With Vision, users can receive audio and video directly on their phones from another Vision, from a PC or even a video door phone. SuperVision uses an Android-based operating system and is equipped with an eight-inch display and a removable webcam. It also allows managers to monitor the company’s telephone activity.
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