Connections Survey Results 2015



Connections Survey Results 2015
An Industry Perspective on the Future of Work
Connections Survey Results 2015
© 2015 BroadSoft. All Rights Reserved.
Dear Friend,
Each year in October for the past 16 years,
BroadSoft has hosted the premier industry event
for cloud communications called BroadSoft
Connections, which is attended by more than
1,000 top service providers and industry leaders.
Today, BroadSoft sells cloud communications
and collaboration software to over 700 service
providers, out of which 26 are amongst the top
30 global providers. These BroadSoft-based
providers deliver services to almost 70% of
global business users, putting BroadSoft into the
#1 position for global hosted IP telephony and
UCC services, according to Frost & Sullivan.
Taher Behbehani
Chief Marketing Officer
With all this expertise in one place, we
conducted a survey at our October 2015
Connections event in order to capture attendee
thoughts on the rapidly shifting business
communications landscape.
We think you’ll be surprised with the gamechanging insights, and future market predictions
found inside this eBook.
© 2015 BroadSoft. All Rights Reserved.
Executive Summary
Overall the survey illustrated a very positive outlook for the growth of cloud-based
communications and collaboration over the next five years.
Of particular note was the prediction that there would be a rapid shift from premise PBX
systems to cloud communications, across all market segments - small, medium and large.
The chart below shows a summary of attendee predictions out to 2020 (top bar, darker color)
vs. current shipments of cloud VoIP/UC in 2015 as estimated by BroadSoft (lower bar, lighter
For access to the full survey results, click here.
Keep in mind that today, market share by business size (for
communications in general, meaning both premise and cloud) is
segmented into roughly:
51% small business
42.5% medium business
6.5% large business
© 2015 BroadSoft. All Rights Reserved.
Key Drivers to Changing Business
The marketplace for business communication services is undergoing a
radical transformation.
For starters, employees are “going rogue” when it comes to what applications and services
they are using for business communication and collaboration. As you can see by the chart
above, business phones are actually fading in relevance – a new approach beyond “just voice”
is clearly needed.
© 2015 BroadSoft. All Rights Reserved.
The tools businesses use today are poorly suited to their challenges.
Communications, notifications and information are scattered across a wide range of devices
and applications. Existing collaboration tools are typically limited in scope, which leads to
ineffective conference calls and meetings. Most troubling of all, business processes and
workflow are fragmented – causing productivity to plummet as employees switch among
multiple applications and tasks. The cumulative financial impact of this dysfunction is costing
businesses billions annually.
© 2015 BroadSoft. All Rights Reserved.
Today’s workforce is changing – and so are
technology preferences.
Millennials have grown up with technology at their fingertips, and they are quick to bring
their preferences to the workplace. While other demographic groups have been convinced
of the merits of a cloud-based delivery model, for Millennials it is a more “natural” choice
and solidly in their wheelhouse. It should be no surprise that as they have begun to move
into management positions and make business-impacting decisions, cloud adoption is
accelerating across organizations of all sizes.
© 2015 BroadSoft. All Rights Reserved.
Communication service providers are facing
a perfect storm of their own.
Traditional, fixed-line telephony revenues are falling. To compound the issue, revenues for
cellular and broadband services have begun to plateau, with stiffer price competition and
lower margins. Customer churn remains a costly and pervasive issue as well, with both
consumer and business customers jumping from carrier to carrier in search of a better deal.
© 2015 BroadSoft. All Rights Reserved.
Market transformation is opening up
emerging opportunities.
Data from both BroadSoft and industry analysts shows strong growth in cloud-based
communication services. Businesses are using hosted PBX services and UCaaS (Unified
Communication as a Service) to replace an aging installed base of premises equipment, and
they are turning to new cloud-based unified communication and collaboration services to
help them work more productively from anywhere, with less complexity and expense.
© 2015 BroadSoft. All Rights Reserved.
But what do service providers and industry
leaders think?
We surveyed nearly 130 participants out of the 1000 top service providers that attended
Connections 2015, on how they believe the marketplace will evolve over the next five years
and how they plan to respond.
How bullish are they about cloud-based services as a
strategy for boosting revenues and slowing costly churn?
Following are the survey results!
© 2015 BroadSoft. All Rights Reserved.
What market position will cloud vendors attain by 2020?
Service providers are bullish on the cloud.
Service providers expect significant growth in hosted PBXs and unified
communications as a service, projecting market-shifting increases in cloud
revenues by 2020. That growth crosses all segments of the business market, from
sole practitioners to the largest of global enterprises. It also is expected to propel
cloud vendors like BroadSoft to a top five market position – displacing premises
PBX providers as the momentum shifts to the cloud.
© 2015 BroadSoft. All Rights Reserved.
What is your strategic, lead and preferred technology solution
The cloud is changing how service providers sell.
More than nine out of 10 service providers currently lead any sales opportunity
with cloud-based solutions. Only ten percent continue to see traditional premisesbased PBXs as their market gateway.
© 2015 BroadSoft. All Rights Reserved.
In five years, what percentage of hosted PBX/UCaaS market share
do you believe cloud solutions will capture in the Small Business*
Small businesses prefer cloud.
Cloud communications solutions are already on the radar screen for many small
firms, and the momentum is building. Service providers believe the cloud will a
major player in the market for small business communications by 2020.
(*under 100 employees)
© 2015 BroadSoft. All Rights Reserved.
In five years, what percentage of hosted PBX/UCaaS market share
do you believe cloud solutions will capture in the Medium Business*
Adoption rates among mid-sized businesses will explode.
Service providers also expect over a 7x gain among mid-market companies. Over
half of all respondents believe that cloud solutions will capture at least 37 percent
of the mid-sized business communications market, which aligns with projections
from industry analysts.
(*100 - 999 employees)
© 2015 BroadSoft. All Rights Reserved.
In five years, what percentage of hosted PBX/UCaaS market share
do you believe cloud solutions will capture in the Large Enterprise*
Cloud adoption will move “up market.”
Service providers are confident they will make newfound share gains among
even the largest global enterprises. These large firms are being lured away from
their current premises-based PBX infrastructure by the superior cost, scalability,
mobility and multi-site capabilities the cloud delivers.
(*1000+ employees)
© 2015 BroadSoft. All Rights Reserved.
In five years, what proportion of UC interactions will occur on
mobile devices?
UC and mobility will become synonymous.
Increasingly large percentages of unified communications interactions will
take place over mobile devices, service providers say. That means viable cloud
solutions must be optimized for mobile devices, not just desktop PCs and phones.
© 2015 BroadSoft. All Rights Reserved.
In five years, what percentage of small businesses will use 100%
mobile/cellular only Hosted PBX/UCaaS cloud solutions?
Small businesses will cut the cord.
With compelling cloud offers to choose from, service providers believe a
significant percentage of SMBs will build on the emerging mobility trend and
eliminate premises PBXs and wired telephones entirely. Instead they will adopt an
all-cellular approach to business communications.
© 2015 BroadSoft. All Rights Reserved.
Will email solutions be disrupted by enterprise integrated
messaging and team collaboration and communication tools such
as HipChat, Glip, Slack, etc.?
Email ... Really!?!?
With a host of new cloud-based integrated messaging, communication and
collaboration tools, service providers believe enterprise email is becoming an oldschool technology and soon will be displaced. Only 18 percent believe it has true
staying power.
© 2015 BroadSoft. All Rights Reserved.
What approach do you consider to be your biggest strategic threat?
Service providers see competing cloud solutions as their biggest
Only five percent believe premise-based, IP PBX solutions will represent true
competition. Instead, the cloud is expected to win the day.
© 2015 BroadSoft. All Rights Reserved.
In three years’ time, what percentage of your installed base will
BroadSoft Hosted PBX/UCC service represent (users)?
They are banking on BroadSoft.
In just three years, service providers believe BroadSoft will power a significant
portion of their installed base – primarily by displacing premise PBX solutions.
© 2015 BroadSoft. All Rights Reserved.
Would you like to see an integrated view of the market that
combines PBX and cloud data to highlight the transition to cloud?
They want one market view.
Industry analysts typically track PBX and cloud hosted communications market
data separately. But service providers see real value in combining the two into a
single report – helping them better monitor marketplace shifts and the speed at
which businesses are transitioning to the cloud.
© 2015 BroadSoft. All Rights Reserved.
3 Key Survey Take Aways
Rapid shift from premise PBX and IP-PBX to
cloud communication solutions across all market
segments - small, mid-market and large
Cloud UC (Unified Communications) and mobility are
considered synonymous – many SMBs will simply go
100% mobile
Email is going to face challenges, as a host of new
cloud-based tools becomes available
Are you ready to make the most of emerging
communication trends?
BroadSoft’s next-generation cloud communication and collaboration solutions unleash
benefits that can ripple across the value chain to help Communication Service Providers
capture market share, reduce churn and build their bottom line.
Interested in learning more?
Contact us at:
[email protected]
© 2015 BroadSoft. All Rights Reserved.