Six UC Predictions for 2016
Here's my take on how unified communications will shape up this year.
Happy New Year, fellow UCers. We're more than halfway through January now, which means the NFL playoffs are well under way, tax season is looming, and it's time for my annual predictions.
1. UC gains momentum with line-of-business (LOB) managers
Despite the strong value proposition to end users, UC has primarily remained an IT purchase. In 2016, however, LOB managers will start purchasing UC services directly. This will become especially easy with the maturation of UCaaS offerings. In addition, UC vendors are now orienting their strategies around selling "business outcomes." In the past, if a UC vendor had an opportunity to meet with a C-level executive or LOB manager, it wouldn't have had anything to say -- but now it does. As Cisco and Microsoft jockey for the No. 1 position, the LOB adoption of UC will create opportunities for other vendors to penetrate these top accounts.
2. UC grows 10% to 15% in 2016
Despite the hype surrounding UC for the better part of 15 years, the technology's adoption has been sluggish. Year after year, UC has failed to live up to industry projections. This year will be different; the $20 billion market will grow at least 10%, and more likely closer to 15%. Cloud services, mobility, and the fact that UC is becoming much easier to integrate into business applications will be key contributors to the market growth. Also, almost every vendor has been focused on making UC products easier to use. This will lead to greater enterprise adoption, which will drive usage, which in turn will create more demand.
3. UCaaS goes upstream
I've read many "UCaaS will grow in 2016" predictions, and to those soothsayers I say, "No kidding." UCaaS has been red-hot over the past few years, with most of the growth coming from U.S.-based small and midsized organizations. This year large organizations will realize the cloud offers a better way of deploying UC then the traditional premises model. Many will begin adopting UCaaS for branch offices, remote workers, or as noted above, within the LOB, and some organizations will shift entirely to UCaaS.
4. UC analytics rises
One of the challenges enterprise IT has faced with UC is the inability to show clear return on investment since much of the value is from "soft" factors such as increased worker productivity or faster decision making. So, how do you take something that historically has been unmeasurable and make it measurable? The answer, "With data and analytics." Expect to see more vendors offer tools that analyze utilization and consumption data they've captured from their products. With such analytics capabilities, enterprise IT buyers should find an easier task of quantifying UC's value. In addition, the rise of analytics will create opportunities for channel partners to develop consulting services aimed at helping customers gather and analyze UC data, and then determine the best actions to take based on the results.
5. Workstream communications and collaboration (WCC) acquisition activity
WCC hit the market in a big way in 2015. In addition to the multitude of tools from WCC startups, Unify Circuit and Cisco Spark went into general availability this past calendar year. RingCentral acquired Glip, bringing another mainstream vendor into the fold. I'm expecting to see at least two WCC acquisitions in 2016, with the most likely targets being HipChat and Redbooth. You might ask, "What about Slack?" Slack certainly has a great brand, but in April 2015 the company's valuation was estimated to be a shade under $3 billion. At the premium price that would be required for a purchase, most vendors would likely find Slack too expensive a target. The one wild card is Oracle, which despite dropping billions on infrastructure, is still just a minority player in the UC industry. Slack would give Oracle one of the top vendors in this red-hot market.
6. Communications-enabled applications go mainstream
It has been my thesis for years that most workers really don't want UC as a standalone application. Users have enough applications on their desktops, and having to flip between business applications and UC tools is inefficient and annoying. Having UC functionality built into the applications we already use would be a much better approach. This is the main reason why, for almost a decade now, the UC vendor community has been building APIs that can enable integration. However, despite the efforts of the solution providers, the expense and complexity of having to rack and stack premises-based equipment have made it prohibitive for developers to build UC-enabled applications. As a I pointed out in my year-end blog, communications platform as a service (CPaaS) offers developers the ability to create integrated applications via a cloud-based platform. This will open the doors to large software companies, corporate developers, and the tens of thousands of small ISVs out there today.