Report:

Magic Quadrant for Unified Communications as a Service

Top Vendor Products for Unified Communications as a Service in 2023

• 8x8
• Cisco
• Microsoft
• RingCentral
• Zoom

Unified Communications as a Service Vendor Product Comparisons 2023

• 8x8 - Leader
  

  Pros:

  • 8x8 remains well aligned to organizations that want to bundle UCaaS and CCaaS solutions without advanced contact center requirements (typically less than 300 contact center agents). 8x8 offers PSTN replacement in 58 countries worldwide and is one of the vendors offering native calling plans most extensively across global regions, including China (added last year).
  • 8x8 is well-positioned to deliver UCaaS and CCaaS to organizations that have already adopted Microsoft Teams for messaging and meetings, but require advanced telephony features. 8x8 is still one of very few UCaaS vendors to currently offer a natively integrated Microsoft Teams contact center solution.
  • 8x8 reports a balanced customer base across all market segments, has strong adoption in North America and the U.K., and is one of the leading vendors to have a relatively strong presence in APAC and LATAM.

  Cons:

  • 8x8 customers have indicated, through Gartner Peer Insights reviews, challenges in obtaining timely customer service and support, and mixed customer satisfaction experiences with the intuitiveness of 8x8's admin portal during deployments.
  • 8x8 has enhanced its capabilities to support midsize (up to 300 agents) and larger contact centers in the last 12 months, including native workforce management, quality management, and speech and text analytics services. Prospective buyers with large customer service requirements — or with advanced feature or integration requirements — should check that 8x8's feature set meets the needs of their customer services business unit.
  • Sylebra Capital, a 12.37% owner of 8X8, changed its status to "Active Investor" in 2023, which may affect the company's long-term direction. Existing customers and potential buyers should regularly monitor 8x8's product roadmap.


• Cisco - Leader
  

  Pros:

  • Cisco is one of the few UCaaS vendors — and the only vendor classed as a Leader by Gartner — that can deliver a complete, self-developed UC portfolio, including phones, headsets, cameras, personal meeting endpoints, room meeting systems, gateways, analog terminal adapters (ATAs) and session border controllers. It also provides data networking and security infrastructure.
  • Cisco has a long track record as a UC/UCaaS vendor with deep expertise and investments in security, regulatory, and industry-specific capabilities and certifications. Organizations seeking UCaaS in highly regulated industries or sectors (including healthcare, financial services, public sector, government and public utilities) are well served by Cisco Webex, whether the regulatory requirements emanate from the U.S., U.K., Europe or Asia.
  • Cisco's recent investments in Webex Control Hub for unified management have included localizations for an extensive set of countries; development of a global partner ecosystem; configuration options that combine cloud services with on-premises infrastructure (for less-developed regions or countries where telecommunications are highly regulated); and survivability capabilities. These investments have made Webex a competitive option for large and/or highly distributed multinational organizations with a complex mix of use cases.

  Cons:

  • Gartner client perception is that Webex's offering is more expensive than its competitors, including other Leaders in this Magic Quadrant. In response, in 2021, Cisco introduced a more competitively priced suite offer, which includes eight different workloads including AI. Gartner client feedback over the last 12 months indicates that competitor pricing is still perceived to be more aggressive.
  • Webex Contact Center is an effective option for organizations that need a unified communications solution bundled and integrated with a small or midsize contact center solution (up to 250 agents). Organizations seeking large, high-volume solutions (more than 1,000 agents) still prefer the leading stand-alone contact center providers.
  • Organizations that are Cisco customers using Unified Communications Manager (UCM) regularly adopt collaboration capabilities from competing UCaaS providers. When organizations give their collaboration business to competing UCaaS vendors, and primarily seek cloud telephony, the benefits of the full UCC Webex offering are less compelling.


• Microsoft - Leader
  

  Pros:

  • Gartner still sees Microsoft Teams as the most popular choice in the UCaaS market, especially for organizations that are already using Teams for messaging and meetings. Microsoft Teams' telephony capabilities satisfy the requirements of the majority of organizations due to the enhancements made over the past year, as well as changing trends in the preferred modalities of users of business communications (more collaboration, less telephony).
  • In the past year, Gartner has observed increased adoption of Operator Connect services as Microsoft continues to invest in telecom partner relations. As of this publication, Microsoft has added approximately 70 telecom operators covering almost all geographies.
  • Microsoft has created significant interest with SMBs by expanding its footprint of calling plans in 35 countries. It has also added support for much-requested pay-as-you-go calling plans to entice organizations with extremely low PSTN outbound call volumes.

  Cons:

  • The addition of the Teams Phone Mobile along with pay-as-you-go calling plans and Operator Connect program for PSTN connectivity for Teams remains an area of uncertainty among organizations about which PSTN connectivity option is a best fit for their situation. Gartner clients often indicate that they are not clear about the Operator Connect offering, and how it differs from Direct Routing or Microsoft Calling Plans.
  • Organizations that have advanced telephony use cases find gaps with Microsoft Teams Phone. For advanced telephony features (such as multiline hunt group capabilities, attendant consoles, advanced call queuing, interactive voice response, and advanced call recording), organizations are often deployed using third-party telephony solutions that integrate with Microsoft Teams. Third-party telephony deployment can be limited to the specific group of users that needs such features if that group is small, or to the entire organization if a majority of users need such features.
  • Gartner clients are often uncertain about their call center options when using Microsoft Teams Phone. Clients report being confused when Microsoft initially introduced a first-party voice channel contact center offering with Dynamics 365, and later introduced Microsoft Digital Contact Center Platform, which integrated Dynamics 365, Teams and Nuance. However, as of this report, Microsoft has not yet offered a self-developed Microsoft Teams call center option, reflecting lack of internal coordination across various product teams.


• RingCentral - Leader
  

  Pros:

  • RingCentral continues to invest in third-party application integration to enable the delivery of advanced UCaaS capabilities via no-code, low-code and pro-code. This capability aligns well to UCaaS buyers that have customization and programmability as a priority.
  • RingCentral's release of its natively developed RingCX contact center solution enables the provider to align with growing business requirements for consolidated UCaaS/CCaaS services. This would benefit UCaaS buyers seeking UCaaS bundled with integrated CCaaS developed by the same provider.
  • RingCentral continues to differentiate through reliable UCaaS service delivery. The vendor has provided 19 consecutive quarters of uptime as of this evaluation, and provides an availability SLA target of 99.999%.

  Cons:

  • RingCentral's core market differentiator is associated with telephony, a segment of customer communications that is driving fewer decisions. Although the company's repositioning of its Microsoft Teams integration (offering less of its broader UCaaS capabilities and focusing on telephony-only integration) offers a possible future entry point to RingCentral's fuller UCaaS suite, it creates an additional challenge for RingCentral to get customers to adopt the fuller collaboration value proposition.
  • The self-developed RingCentral Video solution still trails the solutions from other leading UCaaS providers in areas such as brand recognition, user familiarity, support for large groups, and advanced capabilities (including 1080p full HD video, polling and industry-specific features).
  • RingCentral has invested with legacy UC technology partners to gain access to customers. Some providers, notably Avaya, Atos/Unify, and Alcatel-Lucent have not contributed to RingCentral's customer growth as much as initially forecasted, and the relationships may no longer be exclusive.


• Zoom - Leader
  

  Pros:

  • Since the last Magic Quadrant was published, Zoom has achieved growth of 90%, outpacing most of its competitors. Zoom added more UCaaS users (with telephony) in the last year than in any previous year. Zoom still offers strong incentives to buyers and highly competitive pricing to drive new business.
  • Zoom's investments in Zoom Contact Center — among the areas of highest priority for new features on its roadmap — have significantly advanced its functionality. Gartner has observed significant adoption of Zoom Contact Center over the past year, and expects Zoom to continue adding more advanced capabilities in the next 12-18 months.
  • Zoom is among the UCaaS vendors that have most deeply infused their offering with AI in the past year. This includes Smart Compose for chat and email, Smart Meeting Summaries, Zoom Revenue Accelerator, bidirectional language translations, gesture recognition and smart meeting recordings.

  Cons:

  • Despite the strong growth in its user base, Zoom had a workforce reduction of 15% over the past year, which caused some concern with Gartner clients. This action is not seen by Gartner as a significant sign of business risk, but warrants occasional checking to confirm Zoom's business continues to operate healthily.
  • In prior years, Zoom was the most aggressive vendor in terms of price and promotions. Over the past year, Gartner has observed a tempering of this approach, and some clients are receiving renewal proposals with more moderate discounts relative to their prior terms. Buyers — especially existing Zoom customers — should be aware of this trend when negotiating renewal terms.
  • Zoom is strongly promoting its Zoom One platform, which is a licensing bundle that entitles customers to the full spectrum of Zoom functions. Although Zoom One is a suitable approach for some organizations, many Gartner clients — especially those that have collaboration or contact center tools from competing vendors — may be better off licensing individual components based on their specific needs.


• Dialpad - Visionary
  

  Pros:

  • Dialpad's strategic partnership and deep integration with Google Workspace expands access to customers and product innovation. Dialpad appears on the Google Workspace Marketplace and Google sales channels are compensated for Dialpad solution sales. On the product side, Dialpad's connection to Google gives the company unique access to Google Vertex AI (Google's foundational LLM) and other generative AI innovation resources.
  • Dialpad's AI engine is used across its telephony, messaging, meetings, contact center, and sales capabilities extending useful productivity enhancements, most notably coaching and insights associated with customer support and sales interactions.
  • Dialpad's user and management interfaces are intuitive and generally receive positive feedback from Gartner Peer Insights reviewers for ease of use.

  Cons:

  • Dialpad has limited visibility and brand recognition compared to leading UCaaS providers. This means Dialpad UCaaS services have lower-than-average consideration among IT planners making communications and collaboration decisions.
  • While Dialpad's capabilities align well for most business users, some meeting functionality lags behind competitors, including lack of support for virtual assistants, survey/polling, live translation, online meeting storage integration and full HD video resolution (currently capped at 720p).
  • While Dialpad can support enterprise customers, it has no significant expertise in supporting very large multinational organizations (more than 5,000 users).


• Google - Challenger
  

  Pros:

  • Google's integration of UCaaS capabilities (such as Gmail, Google Drive, Google Docs/Sheets/Slides/Forms) into the broader Google Workspace is well-designed and effective. Users have access to UC services (message, meet, call and collaborate) directly within the other Google applications, improving adoption and user experience. This has been a factor in positive customer feedback from Gartner clients in inquiry.
  • Organizations that already use Google Workspace can, in most cases, realize a lower total cost of ownership when adopting Google's UCaaS capabilities, given many of the UC capabilities needed by organizations are included as part of their Workspace entitlements.
  • Gartner rates Google as "Strong Positive" in financial health. Strong financials indicate that the vendor has the resources to invest in enhancing its offerings and roadmap over the long term, and will likely remain a relevant competitor in the UCaaS market for the foreseeable future.

  Cons:

  • Although Google's telephony feature set can meet the requirements of most organizations with basic telephony requirements, it is important that buyers confirm that any features that are critical to their users or operations are supported.
  • Google's availability SLA target for all Workspace services — including meet, chat and voice — remains at 99.9%, which is considerably lower than most of the UCaaS market (most competing providers offer 99.95% or better).
  • Google does not currently offer a bundled contact center as part of Google Workspace, which is a common requirement for many organizations, especially those with 100 agents or less.


• GoTo - Niche Player
  

  Pros:

  • GoTo's UCaaS services offer intuitive end-user and management interfaces as part of a consolidated desktop and mobile solution set.
  • GoTo's bundled GoTo Connect (telephony, meetings and messaging) and Customer Engagement (consolidated multichannel messaging) align well for resource-constrained, small organizations, especially those looking to implement crowdsourced customer service elements.
  • GoTo is well-positioned in the automotive and education verticals with deep industry integrations and capability alignment with the communications, support and processes in those segments.
  • GoTo generally receives positive feedback in Gartner Peer Insights for onboarding and installation. Customers are typically onboarded via self-serve channels but dedicated project managers, engineers and trainers are available via professional services.

  Cons:

  • GoTo Connect lacks some capabilities required by large organizations. While GoTo has expanded its service footprint, full PSTN replacement is only localized to 14 countries, potentially a limiting factor for multinational organizations. Meeting support is limited to 250 participants (GoTo Webinar supports up to 3,000).
  • Although GoTo's UCaaS offering currently serves (and is suitable for) midmarket organizations, over 90% of its UCaaS customer base is composed of small organizations (under 100 users).
  • GoTo receives mixed reviews for its mobile app with some Gartner clients reporting an inconsistent user experience.


• Sangoma - Niche Player
  

  Pros:

  • Sangoma's UCaaS offering is priced competitively, and has a new bundling strategy that offers many services, including contact center.
  • Sangoma is one of the few vendors that can deliver a complete UCaaS solution that includes both cloud services and hardware (such as desk phones, headsets, and survivable branch appliances).
  • Sangoma has added CPaaS capabilities to its UCaaS offering, which allows organizations to access programmable communication options from their existing UCaaS vendor to enhance operations, increase customer satisfaction, improve safety and add other similar CPaaS benefits.

  Cons:

  • Sangoma has undergone executive leadership changes in 2023, which reduces the certainty of its business priorities, strategy, and roadmap. Existing customers should monitor service levels, account management and support responsiveness closely to identify any potential issues as early as possible.
  • Although Sangoma's offering includes all the foundational components of UC (message, meet, call, contact center), it is strongest in telephony. The collaboration features and user experiences (especially meetings and messaging) receive mixed feedback from end users compared to that of leading UCaaS competitors.
  • Sangoma's brand recognition is low among Gartner clients. As the UCaaS market continues to consolidate, vendors with better-established brands continue to see increased adoption at the expense of their lesser-known competitors. This could present significant business challenges to providers that the market is less aware of.


• Vonage - Niche Player
  

  Pros:

  • Vonage consistently receives positive Gartner Peer Insights feedback from customers on service and support resolution. The vendor offers customer success managers and uses customer service software to proactively obtain data that supports the customer base at no additional charge (without the need for premium support).
  • VBC is tightly integrated with the Vonage Contact Center. Organizations with contact center and UCaaS capabilities can benefit from a consistent user interface, single sign-on, common call controls and a common directory. The UCaaS market has seen a marked increase in demand for a bundled contact center, mostly in the SMB segment, which is Vonage's target market.
  • Vonage has a very strong positioning in the CPaaS market. It uses the same microservices-based platform to integrate UC services with business applications as it does to create customizations and integration opportunities that are not easily realized with vendors that do not have CPaaS capabilities.

  Cons:

  • Ericsson's acquisition of Vonage has the potential of deemphasizing focus on UCaaS. The Vonage acquisition has shown promising growth from CPaaS services, which are already being leveraged and integrated into Ericsson's 5G wireless (cellular) infrastructure. Although Ericsson has stated it intends to power Telcos and CSPs with UCaaS, Ericsson could change the priority of the UCaaS offering given consolidation in the UCaaS market.
  • Vonage Meetings lags behind competing vendors in suitability for advanced use case requirements, especially for large enterprises. The solution supports only a maximum of 200 participants, and does not natively support automated transcription or language translation, large events, polling, or room integrations.
  • Vonage's year-over-year growth has been flat when compared to leading UCaaS providers. It has struggled to increase adoption and develop brand awareness outside of North America. Some VBC customers noted difficulties with support outside of North America.


• Wildix - Niche Player
  

  Pros:

  • Wildix has a very strong user base in the European market, with 70% of its total customers based there. The remaining 30% are in other geographies including North America.
  • Integration with Microsoft Teams and more enhancements on IM presence updates offered by Wildix are well-suited to SMBs looking for Teams-integrated UCaaS.
  • Semantic analysis of telephony and meetings recordings enhance the experience for call and meeting analysis.

  Cons:

  • Despite having a reported base of users larger than some competing vendors, Wildix has the lowest revenue among all the vendors surveyed in this report, which may cause additional scrutiny and pause among UCaaS buyers.
  • Wildix's core differentiation is a web-based approach that is designed for sales and support roles. This is a considerably different roadmap priority and positioning than competing UCaaS providers where the design approach is meant to address the business communication requirements of all users in an organization.
  • The vendor's focus and positioning of its offering as a sales tool limits its reach in the broader UCaaS market. Wildix lacks market brand awareness among Gartner clients that are seeking UCaaS solutions.

Reference

• Gartner, Magic Quadrant for Unified Communications as a Service, 28 November 2023, ID G00783580

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