Unified Communication Market Share Report - Size, Growth Trends & Forecast-2030

The unified communications market is anticipated to grow from US$ 59.75 billion in 2022 to US$ 196.73 billion by 2030; it is projected to grow at a CAGR of 16.1% from 2022 to 2030.

Analyst Perspective:

The unified communications market has witnessed significant growth over the past few years, primarily fueled by the rising demand for remote collaboration among distributed workforce across different verticals. The objective of this is to unify and simplify business communication, boost the team’s efficiency and collaboration, and provide a better customer experience. It offers several benefits, such as improved productivity, support for effective communication between a mobile and remote workforce, and lower capital investments required for administration and maintenance, among other benefits. Its inherent nature is to integrate a wide range of applications onto a common, singular platform. While it makes for a powerful solution, the effectiveness of the same is dependent on the vendor's ability to provide unified interworking among the elements. Some vendors natively offer most of these elements, while others depend on external partners for pre-integrated solutions to provide a seamless experience. With new applications being developed on a regular basis, interoperability becomes an ongoing challenge. While the presence of several unified communication vendors allows for a highly competitive nature of the market, better harmony is required among such vendors to meet the needs of their customers efficiently. Since all forms of interoperability are not equal, end users evaluate their vendors critically to ensure that their solutions can integrate seamlessly into the user’s existing network environment.

Market

Overview:

Unified Communications describes the different forms of interaction and collaboration between communication tools. By unifying web conferencing, SMS, phone calls, and email, among others, team members can share and access data and work together in real time over an internet connection. Irrespective of the size of the business, the right solution can take business processes to the next level. It improves collaboration, boosts productivity, increases mobility and enhances the user experience. A unified communications environment is usually supported by one or multiple back-end management systems, or unified communication platforms, that ease the integration among services and also the front-end clients, providing access. This has transformed in the past few years from mostly supporting on-site collaboration through in-room conferencing to allowing collaboration among remote workforces with audio and video conferencing and others.

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Unified Communications Market: Strategic Insights

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Market

Driver:

Rising Demand for UCaaS to Drive Growth in the Market

Presently, unified communications support hybrid in-office and at-home workforces, which is a trend strongly adopted during the COVID-19 pandemic. To support such distributed workforces, enterprises are shifting to unified communications as a service (UCaaS). It is part of the broader migration to the cloud that all businesses are managing. UCaaS allows for remote collaboration, which is a big requirement for such a distributed workforce. Instead of using communication apps, often supported by different vendors, on a standalone basis, UCaaS combines all these services and also integrates applications such as messaging, email, video conferencing, and VoIP. It is also beneficial for the in-house information technology (IT) team since one vendor is responsible for the entire deployment. Further, most remotely working employees generally work in multiple settings and utilize different devices with different endpoints. In addition, employees are prone to routinely shifting modes over the course of their day or a particular session. They may be shifting from desktop to smartphone, instant messaging to voice over internet protocol (VoIP) or from one-to-one email to video conferencing for a team meeting. It can provide a consistent user experience over such various devices.

Additionally, UCaaS is subscription-based and hence is an operational expenditure (OPEX), as opposed to capital expenditure (CAPEX) incurred for managing disparate systems in-house. Numerous macroeconomic factors across the globe created a severely adverse environment for businesses. The pandemic caused severe disturbances, which led to huge losses for various industry verticals. Political turmoil in Europe, the Middle East, and South America has been negatively affecting different industry verticals in different ways. Severe economic downturns in several countries have resulted in decreased consumer spending on discretionary goods. Thus, most industry verticals have endured losses due to such a decrease in consumption. Such factors have compelled enterprises to adopt different measures to remain competitive through a reduction in capital expenditure. Thus, being an OPEX, UCaaS is registering strong demand from both SMEs and large enterprises. Such advantages and trends are strongly boosting the demand for a unified communications market globally.

Segmental Analysis:

The unified communications market is segmented on the basis of type, deployment, organization size, and vertical. Based on type, the unified communications market is segmented into telephony, conferencing, unified messaging, and others. By deployment, the unified communications market is divided into on-premise and cloud. By organization size, the unified communications market is bifurcated into SMEs and large enterprises. Based on vertical, the unified communications market is segregated into academic & public institutions, BFSI, healthcare, IT & telecom, manufacturing, retail & e-commerce, and others.

Large enterprises acquired the largest market share in 2022 and are expected to continue their domination throughout the forecast period. However, the SME segment is anticipated to witness a faster growth rate, buoyed by the rise in digital transformation and wide adoption of unified communications solutions among such companies. Additionally, several unified communications market players are tailoring their products to serve the SMEs specifically. It is leading to better acceptance of these solutions amongst SMEs, boosting the segment's growth rate.

Regional Analysis:

North America holds a substantial share of the unified communications market. The region has a high penetration of 5G networks and has a higher acceptance of advanced technology. Additionally, the region is a pioneer in the development and deployment of such technologies. Additionally, the US and Canada have been witnessing a significant rise in digital transformation amongst enterprises across various verticals. E-commerce is one such vertical that has witnessed a significant surge in the past few years.

Similarly, the telecommunications sector has witnessed a huge surge. The growth of these verticals has positively impacted the adoption of unified communications across these verticals. Such factors have also prompted several unified communications market players to improve their presence in the region. In July 2023, OMNIQ Corporation, a leading provider of supply chain and artificial intelligence (AI) based solutions, announced plans to acquire Tadiran Telecom, an international provider of Advanced Unified Communications and Collaboration (UC&C) Solutions. Tadiran is expected to complement omniQ’s portfolio by enabling a comprehensive telecom solution combined with legacy solutions, including UCaaS and unified communications & collaboration platforms for customers ranging across shopping centers, logistic yards, governments, supermarkets, hospitals, transportation, financial institutions, hotels, power stations, organizations, and others. The comprehensive solution is expected to improve connectivity, efficiencies and data management of omniQ’s customers.

Key Player Analysis:

The unified communications market landscape consists of players such as Alphabet Inc., Avaya Inc., Cisco Systems Inc., Microsoft Corporation, Mitel Networks Corporation, NEC Corporation, Plantronics Inc., RingCentral Inc., Telefonaktiebolaget LM Ericsson, and Zoom Video Communications. The market is fragmented, with several solution providers from the North American region dominating the unified communications market.

Recent Developments:

Companies in the unified communications market adopt several inorganic and organic strategies, such as product innovation and partnership. Alphabet Inc., Cisco Systems, Microsoft Corporation, NEC Corporation, and Zoom Video Communications are key players in the unified communications market. With the strong growth in demand for unified communications, numerous companies have established partnerships to expand their offerings in digital solutions. For instance, in June 2023, RingCentral announced plans to offer fully compliant cloud phone services in India after it cleared critical regulatory verifications by the Telecom Regulatory Authority of India (TRAI) and the Department of Telecommunications (DOT). RingCentral had been granted a Unified Licence for providing a UCaaS service by the Indian government initially. Since receipt of the same, the vendor has continuously developed its infrastructure in the country and passed government security inspections to achieve its regulatory verification. The launch is expected to allow multinational organizations to access cloud phone capabilities, empowering smoother communication with various stakeholders and improving RingCentral’s market share. A few recent key unified communications market developments are listed below:

• June 2023 – Oculum VC announced the release of OmniUC, a white-label video conferencing and unified communications platform designed for the telecom industry. Fully developed on WebRTC, the new product is a turnkey solution that is layered into existing voice applications with minimal development, requires no apps, plug-ins or downloads and is compatible across all modern browsers and mobile devices.
• April 2023 – Vodafone partnered with RingCentral to launch Vodafone Business Unified Communications in Italy. The new solution allows enterprises of all sizes to adopt a hybrid modality of functioning easily by omitting traditional point-to-point fixed connections and replacing them with agile, reliable, and secure cloud services that employees can access from multiple locations.
• February 2023 - Zoho Corporation, a leading technology company, launched its unified communications platform, Trident. It also strengthened its collaboration technologies to offer enterprises an easier mode of communicating across channels and improve an organization's overall digital adoption.
• July 2022 – Telefonaktiebolaget LM Ericsson acquired Vonage Holdings Corp and is expected to allow the former to develop a full suite of communication-related solutions, including Communications Platform as a Service (CPaaS) and UCaaS.