Ian Simons, Avanade SA

Although unified communications-as-a-service is set to grow exponentially on a global scale, the SA market will need time to catch up

Market research firm Markets and Markets says unified communications-as-a-service (UCaaS) is a rapidly growing market. According to the research, UCaaS will be one of the key enabling factors that will drive the market for unified communications (UC), and the shift from on-premises to a cloud-based UC model will be the key driver for UC to grow in the future.

The study also reports the global UCaaS market is expected to grow from $2.52 billion in 2013 to $7.62 billion by 2018, at an estimated Compound Annual Growth Rate (CAGR) of 24.8% from 2013 to 2018. Telephony is the most used technology for now and will remain so in the coming few years.

However, according to Ian Simons, infrastructure transformation consultant for Avanade SA, the local market is still lagging behind the rest of the world from an adoption perspective, especially due to network bandwidth issues. “UCaaS is still relatively early in the ‘hype curve’,” he says. “However, it is a solid offering across the globe and cloud service providers are offering these services locally to the market, based on tried and tested UCaaS blueprints.”

He explains traditional telephony is almost a thing of the past as organisations leverage off their existing network connectivity and merge their telephony with their IT infrastructure. “Traditional telephony really only offers a ‘dial tone’ and not much else. Organisations are looking to incorporate all forms of communication into their business processes. This is also being driven by the advent of technologies like communication enabled business processes (CEBP), which is driving the development and integration of electronic communications into organisation’s line of business application.”

Karl Reed, chief marketing and solutions officer of Elingo believes although UCaaS is a solid new offering, it is not suited to every organisation. “Smaller organisations would benefit more than larger, more security-conscious companies that have access to larger funding and able to invest in technology that smaller organisations cannot afford,” he says.

He explains organisations looking to buy into this type of solution need to understand exactly what is offered by each option and each solution provider. “A detailed apples-for-apples comparison needs to be performed by the organisation on the offerings provided by the solution providers,” he advises.

According to Wayne Speechly, executive: communication services at Internet Solutions, there may be some confusion with regards to UCaaS in relation to UC. “In reality, there is nothing ‘new’ about UCaaS in principle. Over the years, the delivery of UC has evolved.

One of those evolutions has been that the service has embraced the delivery and licensing mechanism offered by cloud-computing, versus a client requiring an on-premise solution,” he explains.

TRADITIONAL VS UCAAS

Wayne Speechly, <a href=

Internet Solutions" />According to Simons, traditional UC differs from UCaaS in that traditional UC was hosted by the customer in their own datacentre, supported and maintained either by an outsource partner or in-house skills. “UCaaS is a cloud offering and differs from traditional UC by either being hosted on-premise or off-premise, depending on the cloud service provider. Customers essentially pay for a service and no longer need to concern themselves with hardware, software or even support costs. These are all integrated into the UCaaS offering. UC costs now move from capex to opex and the financial controller in an organisation is more likely to agree to an increase in opex than parting with capex. Typical ‘aaS’ offerings are based on a service catalogue and in many cases are feature limited and not at all open to customisation,” he explains.

Reed agrees UC today is very different from the traditional UC. “Today, communications entails the use of voice, voicemail, fax, e-mail, sms, IM, social media, etc. through a single interface, whereas traditional UC was just voice, sometimes voicemail and fax delivered through bolt on applications,” he says.

According to Speechly, UCaaS offers clients the typical benefits of cloud, including significant savings, and higher availability than an on-premise solution. “Generally, smaller enterprises will opt for a pure UCaaS solution, allowing them to escape the capital outlay and operational expenditure, whilst larger organisations might look at a hybrid model, moving certain functionality to the cloud whilst retaining control of other elements of the UC suite. So, while UCaaS (regardless of consumption model) has gained a fair amount of media traction, the principles remain the same for an on-premise or more traditional UC service. The coverage touting the benefits of UCaaS over the past few months, however, is far from hype and has the potential to mean something more tangible for business,” he explains.

COST-SAVING BENEFITS

Being cloud-based, according to Speechly, UCaaS dramatically reduces the capital outlay required by organisations for on-premise solutions. “This expenditure includes the costs of training staff, buying licences, and hardware, as well as developing the competency across a myriad of complex technologies. UCaaS offers a fully hosted and managed solution, thus making the implementation and on-going operation far more financially accessible for organisations. There is also now special appeal and accessibility for SMEs who were previously prejudiced. In addition, the licensing model is utility-based, meaning organisations can increase and decrease capacity as required.”

He says UCaaS technology has matured to the point where it can offer a quantifiable ROI. “Whilst this is a high priority discussion for many South African businesses, certain aspects specific to our market must be considered and more importantly must be used to ensure the update of these services is realistic in order to prevent hype and the chasing of vapourware,” Speechly explains.

Karl Reed, Elingo

Factors affecting uptake and the everyday utilisation of UC and the UCaaS model, Speechly says, include network quality, broadband accessibility, organisational customisation and reliability.

According to Simons, the benefits of UCaaS are similar to those of any cloud offering - customers only pay for what they use and do not have to own spending. UCaaS potentially eliminates this wasted expenditure. Upgrades and migrations to newer versions of UC can be avoided by moving from traditional UC to UCaaS. Smaller organisations can also leverage off the advantages of traditional UC without having to have the costs associated with traditional UC.”

He explains, as-a-service (aaS) offerings allow organisations to focus on their core business and to leave IT to the professionals. “Typically “aaS” offers an attractive price based on the provider leveraging economies of scale etc., which is not available in bespoke on premise solutions,” he says.

According to Reed, UCaas would suit organisations who don’t have their own IT department and who are less technology savvy. “The organisations who would generally not have the capital to buy such a solution or don’t have the money or understanding to support a UC platform would benefit from using a cloud-based solution. They will have access to top class technology at an affordable monthly cost,” he explains.

Also critically important with regards to UCaaS, as Speechly points out, are the policies and procedures which underpin how organisations evolve to consume such services. “Organisations cannot introduce a technology of this nature without planning for the culture around mobile productivity and application accessibility across a plethora of devices to change. The business culture in SA is risk averse, and users and management will overlook technologies they don’t trust. Historically, UC and associated technologies, such as VoIP have left user experience wanting. The industry needs to work toward mass market acceptance, trust and buy-in, which will result from a combination of improving infrastructure and successful use cases. Change management and policies and procedures are key elements here,” he says.

Furthermore, he continues, there is a pressing fear among CIOs that the introduction of UCaaS solutions will in fact increase spend, rather than reduce it. “The concern pertaining to unmanaged costs that may arise as a result of unmanaged, or unmanageable spend through the company network, is a valid one, and must be addressed through policies relating both to UCaaS and the associated BYOD trend. Without firm use policies and technology frameworks and roadmaps in place, organisations are likely to not realise the benefit UCaaS can bring, and experience all the potential pitfalls and disappointments,” Speechly explains.

THE WAY FORWARD

Simons believes UCaaS will continue to grow as an offering with many vendors adding additional features and technologies.” Bear in mind that UC is a continually changing set of technologies and will continue to evolve as a result. We are only at the early stages of development of this technology.”

He says Avanade has already increased its Unified Communications & Collaboration Managed Services (UC&CMS) offering to include messaging, telephony, presence, collaboration, video and mobile device management. “As network bandwidth quality improves and costs reduce, the adoption of UCaaS will increase here in SA.”

According to Speechly, while Internet Solutions and many other providers have invested heavily in network infrastructure, SA still has a way to go before we can boast a fully pervasive and everywhere connected Internet. “This is before we start considering costs. So, whilst a business might have a reliable fibre cable as its last mile connection, in order for UC to be used as an organisation’s primary telephony tool, the recipient of the communication must also have a high quality connection outside of the organisation. A stumbling block at this point in the local market is perceived poor quality Internet-based-VoIP and -videoconferencing calls due to the lack of capacity in fixed-line and mobile networks,” he explains.

As a result, he adds, the company is witnessing a strong local uptake in UCaaS-based services such as Microsoft Lync, where businesses are adopting UC for the benefits it offers to internal operations. “UCaaS offers measurable and significant improvements that extend way beyond cheaper telephony. The Information Week State of Unified Communications 2013 report states that improving employee collaboration and efficiency are the top business drivers to adopting UCaaS – and come in as vastly more important (59% and 56% respectively), than the cost savings that can be realised (17%). Here, real value is created by ensuring employees have access to the full depth of their organisation’s intellectual property, integrating services such as customer relationship management and enterprise resource planning, and providing true connectivity to mobile employees,” he says.

According to Forrester, Speechly continues, over one third of employees in the UK and US work from multiple locations, and over 50% of employees have multiple devices from which they are accessing the company network. “SA is not far behind the technology trends of these countries, and local business needs to start taking the adoption of UCaaS seriously,” he concludes.