Gartner: Big Changes Afoot for UC
Which of today's UC vendors will own the future? It's anybody's guess.
As always, the Gartner "Magic Quadrant for Unified Communications (UC MQ) report, published July 13, is a concise summary of the UC marketplace and vendors. Well-established Gartner UC experts Bern Elliot, Steve Blood, and Megan Marek Fernandez authored the report, with a focus on on-premises UC for large enterprises (Gartner covers midmarket UC and UC as a service in separate MQ reports).
This year's UC MQ takes on increased importance, as Gartner has discontinued the Magic Quadrant for Corporate Telephony. The IT analyst firm felt a separate telephony MQ was no longer needed since UC capabilities have become the primary planning and procurement criteria, Gartner sources have indicated. This results in "an emphasis on vendors' telephony capabilities" for 2016, the Gartner analysts noted in the UC MQ.
"The primary goal of all UC solutions is to improve user productivity and to enhance the business processes related to communications and collaboration," the UC MQ states. This aligns with the long-held UC Strategies definition of UC: "Communications integrated to optimize business processes."
As always in an MQ, the Gartner analysts categorized vendors into four quadrants. This year's breakdown is:
- Leaders - Cisco, Microsoft, Mitel, Avaya
- Challengers - NEC, ALE, Huawei
- Visionaries - Unify
- Niche Players - ShoreTel, Interactive Intelligence
And here's a look at the dynamics of the relative positioning since 2015:
- Cisco has held its leading position
- Microsoft has declined slightly based on the effects of its evolution to Office 365 cloud voice and Gartner's increased emphasis on telephony in this UC MQ
- Avaya has declined slightly in ability to execute, but remains in the Leader's quadrant
- Unify has moved from Niche to Visionary, while ShoreTel has moved the opposite way
- Huawei has advanced from Niche to Challenger based on the increasing strength of its UC portfolio and geographic coverage
- IBM has departed the UC MQ based on its shifting emphasis to work stream collaboration via the IBM Connections offering, in lieu of a continued emphasis on voice telephony
- Mitel, NEC, and Interactive have remained essentially the same year to year
However, even as Gartner places an increased emphasis on telephony, much of the report points to a future direction that is far removed from that discipline. "Adjacent markets play a critical role in how UC is evolving," as the Gartner analysts state in the report.
Given the critical importance of moving into adjacencies, you will see that most vendors are urgently hedging their bets against the declines in revenues, margins, and unit volumes in the rapidly consolidating corporate telephony market space. Here are a few points that jump out for me:
- Cloud and Hybrid - This is huge. Beware those that simply host their on-premises solutions in the cloud. Rather look for the innovators that can transform business processes based on what they offer or that can redefine the economics based on multitenant or microservice offers.
- Work stream collaboration - This is a very interesting topic, as No Jitter editor Beth Schultz described in last week's post, "Adding Next-Gen Messaging Into the Mix." However, only one of this years' UC MQ leaders is also a leader in this space, if you use the Gartner's "Magic Quadrant on Social Software in the Workplace" as the guide (see related post, "Business Social Networks Leading the Way for Decades," and note that this is where IBM went with Connections, rather than staying with UC/telephony.)
- Video as a Service (VaaS) and Web Conferencing - Gartner highlights the ability of VaaS to connect users with differing video endpoints. This will be increasingly important as we learn how to be video consumers, even if it's a narrow niche since video apps providers can solve this for us. However, this points back to the conferencing capability that Gartner designates as one of the six mandatory requirements for UC vendors. Only two of the 10 UC MQ companies, Cisco and Microsoft, are also in the Gartner MQ for Web Conferencing (both in the Leaders quadrant). Most Web conferencing is entirely separate from IP PBXs and corporate telephony; Web conferencing apps on mobile devices may well become the enterprise communications platform.
- Communications platform as a service (CPaaS) - These platforms are the breeding ground for future communications apps. While half of the UC MQ vendors have offerings in this area, the native Internet CPaaS companies have already shown their leadership, as evidenced in the success of Twilio's recent IPO
- Megabundles - This may be the financial future of UC. Many of the UC MQ vendors offer enterprise agreements, but the big change is signaled by the bundles that essentially include UC as part of enterprise agreements for networking technology (Cisco, Huawei), enterprise productivity software (Microsoft), cloud productivity apps bundles (Microsoft), Web conferencing (Cisco, Microsoft), or data center management (Unify, via new parent Atos). UC may evolve to be a feature of data center and networking technologies or of cloud application suites (and UC is better placed as an app than as infrastructure, IMHO). IP telephony vendors without a strong adjacent market may be shut out of this trend (or may embrace it, as Unify did by joining Atos).
Clearly, big changes are afoot, and there is no assurance that the IP PBX-based UC players (all of them except Microsoft) in this year's UC MQ will own the future. In general, it seems the best strategy for most enterprises over the next few years is to focus their UC investments on pilot projects linked to specific usage profiles that leverage these emerging forms of communications, precisely directed toward optimizing business processes or producing measurable user productivity. This will still be UC, but a new kind of UC, for sure.
May you have great success in transforming your organization with UC.