Unified Communications (UC) has come of age. We’ve been talking about the power of Unified Communications now for years but now business is experiencing first hand the value of having the new voice applications at work in their office. I was inspired by an article I read written by Khali Henderson in Phone+ Magazine this week that mentioned SimpleSignal. I’ve pulled out sections of her article and written this blog entry around them.
Businesses have begun to adopt a business strategy that includes voice applications at a stunning pace. Market projections show significant adoption over the next five years. Here’s some stats:
In its worldwide forecast published in June, Wainhouse Research found hosted Unified Communications will grow from $200 million today to $1 billion in 2011 and more than $5 billion in 2014. A competitive report, released by Radicati Group Inc. in May, similarly projected the market would reach nearly $5 billion by 2013 while its 2009 estimates are at $2.9 billion. North America Hosted Unified Communications revenue is expected to grow at a compound annual growth rate of 400 percent between 2009 and 2013. That is actually a very small number since most true hosted Unified Communications deployments started only last fall; thus the incredible revenue growth rate projection. Hosted Unified Communications seat growth for North America has a similar trajectory, climbing 273 percent over the forecast period.
Based on interviews with analysts and service providers, Unified Communications at a base level must include three elements — telephony, messaging and presence — integrated into a single interface. Beyond those core capabilities, consensus breaks down. The most common add-ons mentioned are mobility (i.e., fixed mobile convergence or FMC), collaboration and conferencing, and integration with business software applications, such as CRM.
The pitch for Unified Communications must necessarily go beyond the cost-savings discussion that has been fairly successful at convincing companies to migrate premises-based point solutions like IP PBXs and e-mail to hosted versions. Communicating the business benefits of Unified Communications is key.
While cost may not be the only reason for outsourcing hosted Unified Communications, there’s a great story to tell here, providers say, and it’s resonating well with companies of all sizes during the recession. Simply put, it just costs less money to install a hosted Unified Communications solution than buy a piece of equipment and put it in a closet in your office.
For instance, Microsoft’s OCS requires 12 servers by itself without tying it to a PBX. Adding other applications, such as Web conferencing and secure chat, only serves to drive the cost higher. The capital requirements are massive if you want to take this on, this doesn’t even address the soft costs of personnel to manage and maintain it. And the demands for knowledgeable IT staff don’t end once the system is deployed. Depending on the vendor of your Unified Communications platform, you do need a level of expertise to appropriately manage it, and that level of expertise increases as your enterprise size increases as well. Using SimpleSignal takes the worry away. Our highly trained technical staff manage all the complexities of running the Unified Communications platform. So outsourcing hosted Unified Communications can not only offer a company the benefits of the technology faster, it can offer the scalability required to meet growing —or shrinking—needs.
Another consideration is the cost of having a backup location in support of business continuity. SimpleSignal’s Unified Communications applications include all the accoutrements of a data center, including backup power, site redundancy and high-capacity bandwidth connectivity.
An additional “hidden” cost is keeping up with technology migration. New revs are coming faster and faster — not all of them are software, some are hardware — and those costs are unpredictable about when they are going to come and how much they are.
Wise companies are considering the reality that because technology is changing so fast, companies are increasingly worried about taking on the “capital risk” of a hardware solution and looking for ways to “future proof” their voice infrastructure.
The opex picture for hosted Unified Communications also looks pretty good when considering that just subscribing to point solutions like Web conferencing alone can be $60-plus per month per employee. Compare that to SimpleSignal’s fully loaded $59 per month per employee price tag for a hosted Unified Communications configuration including unlimited voice calls, conferencing, PBX, unified messaging and hosted Exchange server (email).
Money isn’t the only thing businesses need a lot of to implement Unified Communications on their own. Deploying a best-of-breed solution takes expertise in spades, and since it’s newer technology, that means research and time. A hosted Unified Communications provider has brought together myriad solutions, such as Microsoft OCS, Cisco Unified Communications Manager, integration with CRM like ACT! and Salesforce.com, Microsoft Exchange, Google Apps and more.
What SimpleSignal really does is solve the complexity issue. We’ve made it “simple” for a business to deploy Unified Communications. When you go with a hosted solution, it really is an on-demand type of relationship. We can have a full Unified Communications application in a four-week period instead of an 18-month period (for an on-premises solution).
This mind shift along with increased resource (people and cash) restraints due to the recession may be the reason that increasingly larger companies are moving to hosted Unified Communications.
This past weekend I met with the CEO of Broadsoft Mike Tessler. He shared with me that he knows of very large multi-location customers have started to dramatically change to the hosted model. This trend for hosted to go “upstream” is new in 2009. We’ve not seen that before. We were mainly focused on small and medium businesses (under 50 employees). Now, the very large customer who, because of these economic times, are forced to focus on a smarter, more efficient, less capital-intensive way to get their voice and Internet services are considering SimpleSignal.
It seems that our biggest problem is awareness. Most businesses aren’t really aware, especially if they are smaller companies, that hosted Unified Communications is an option. Now is the time for our great company to come to the aid of our country. 
