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The rising demand for SD-WAN capabilities and the implementation of AI and smart solutions are trends in the UCaaS market. Factors driving growth in the market include the low-cost characteristic of UCaaS and a rise in investment in IT infrastructure and steady economic growth.

UCaaS Trends

1. Growing Demand for SD-WAN Capabilities

  • The rising demand for SD-WAN capabilities is one major trend in the UCaaS market.
  • According to a study by Masergy in partnership with IDG Research, 93% of IT decision-makers at global enterprises that implement or plan to implement UCaaS want “their UCaaS solutions to come bundled with network services in a single, seamless approach.” 90% of them prefer UCaaS solutions that are bundled with 24/7 monitoring and a software-defined network (SD-WAN).
  • For example, UCaaS makes up 30-40% of Windstream’s SD-WAN implementations. Also, the Utah-based SD-WAN provider, FatPipe, has reported high-performance measurements through integration with a cloud UCaaS provider.

2. Rise of Artificial Intelligence and Smart Solutions

  • It is becoming increasingly easy for businesses to implement intelligent tools, such as machine learning and artificial intelligence features into their UCaaS environment, to increase the effectiveness of both internal and external communications.
  • According to Frontier Business, some of the ways AI is revolutionizing UCaaS include the development of smarter bots, smoother calls and meetings, personalized customer relationships, and advanced speech-to-text.
  • According to Voximplant’s CEO, Alexey Aylarov, there are many promising ongoing developments aimed at improving the quality of communications, including developing AI for the automation of routine UCaaS processes.
  • Also, Cisco’s Sonali Karnik notes that in the UCaaS market, “solutions such as artificial intelligence, machine learning, voice recognition, and other highly specialized technologies are only becoming more prevalent and widely used.”

Growth Drivers in the UCaaS Market

1. Rising IT Infrastructure Investment and Steady Economic Growth

  • Based on a report by Transparency Market Research, the North America region is expected to continue leading the global UCaaS market and remain the chief revenue contributor due to the emergence of numerous tech-savvy employees and improved infrastructure.
  • Fortune Business Insights also notes that there is a rise in investment in IT infrastructure, ongoing technological developments, and stable economic growth in North America. This rise in investments in industries, including “consumer goods, financial services, and insurance (BFSI), transportation and logistics, retail, and telecom,” is expected to lead to a surge in demand for UCaaS in the coming years.
  • According to Frost & Sullivan, these “rapid growth rates in the North American hosted IP telephony and UCaaS market will continue to attract new providers” and lead to more competition among UCaaS providers.

2. Low Cost and Pay-Per-Use Model

  • The cost-efficiency of UCaaS offered by the low installation and maintenance costs, together with its subscription payment model, is driving UCaaS adoption and revenue growth.
  • According to Kenneth Research, has advanced significantly due to the proliferation of “devices and applications along with demand for high-volume messaging, call sharing, video, and meeting capabilities.” Also, increased penetration of mobile internet, availability of low-cost handsets, reduction of voice calling rates, as well as the rise of new messaging apps are driving the UCaaS market growth.
  • According to Windstream, this low-cost characteristic makes it easy for organizations to rely “on predictable costs directly related to the consumption of UCaaS solutions that boost employee productivity and job satisfaction.”

Research Strategy

Trends and growth drivers specific to the US UCaaS market are not readily available. However, since North America, led by the US, dominates the global market, it has been assumed that most of the trends and growth drivers in the global UCaaS market are applicable in the US market.

TDM

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