UCaaS Market Sees Growth, Recurring Revenue Streams


Long-term growth, high margins, and recurring revenue streams make the UCaaS market a captivating opportunity for Managed IT Service providers.

Although it’s forecasted to grow by double digits through 2023, it’s not just the size of the UCaaS market that makes it attractive to MSPs. The North America voice landscape is in the middle of a radical disruption that is allowing smaller, emerging players positioning cloud-based solutions to compete and win against traditional voice incumbents.

Customers are moving away from conventional capital technology purchases and embracing new consumption-based models. The pay-as-you-go nature of UCaaS fits the bill perfectly — requiring minimal upfront investment, it’s quick to deploy, expand and upgrade.

Enterprise customers are also choosing to focus more on their core businesses and less on managing technical infrastructure. UCaaS moves much of that infrastructure management to the provider, allowing for the reallocation of staff and budget resources to more strategic initiatives.

MSPs are also embracing other key advantages of the UCaaS market:

  • UCaaS remains a largely untapped opportunity — Gartner estimates that on-premise solutions still account for 70% of the solutions sold to enterprise customers. At the same time, Gartner reports that “UCaaS capabilities now exceed those available from premises-based UC solutions.”
  • While selling premise-based voice solutions is capital-intensive, UCaaS requires significantly less financial investment and involves a much shorter sales cycle.
  • UCaaS generates recurring revenue for MSPs, typically for 6-10 years. Growth in user counts and the integration of new features and applications create an ongoing customer engagement, making UCaaS a truly ‘sticky’ solution.
Many customers are streamlining supplier relationships and embracing ‘one-stop shopping.’ Once embedded with UCaaS, MSPs can position and consolidate other managed security, cloud, and infrastructure solutions.

If you are currently selling UCaaS solutions or thinking of selling Cloud-Based Unified Communications we need your input. Please participate in the second Annual MSP UCaaS Survey to help us identify main challenges and pain points that MSPs face. The results of the survey will help MSPs compete and win the UCaaS market in the evolving channel.

Go To Survey >>