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UC as a service emerging as a viable deployment model

Telephony expert Jon Arnold examines the emergence of UC in the cloud and discusses how its evolution is part of a growing shift toward cloud-based services for the enterprise.

When businesses are ready to seriously consider unified communications (UC), a fundamental decision emerges about the deployment model. The conventional path is to deploy a premises-based solution, much like what has been done with other communications technologies to date. This is the familiar model where an IT team prefers to own and operate the solution, but not every IT department can do that. In many cases, the expertise is lacking, and shrinking budgets dictate a more economical approach.

Unified communications as a service (UCaaS) is emerging now as a viable alternative for businesses of all sizes, regardless of the resources available to an IT team. The emergence of UC as a service speaks to the broader trend of hosting services and applications in the cloud. Instead of having the IT department manage the UC platform and host it on-site, the solution resides elsewhere in a data center used by the UC partner and managed by them.

In some cases it will be their own data center; in others it will be with a third-party provider that could offer UC in either a public or private cloud environment. These distinctions require further consideration, but the main point is that UCaaS is a cloud-based alternative to the conventional premises-based deployment model.

Tracking the evolution of UCaaS

Variations of UC as a service have been in the market for years, starting first with basic VoIP, offered either on a hosted or managed basis. The difference was based on whether the service was hosted off-site or if the management of the related network operations was included as well. VoIP is a subset of UC and relatively simple, so the decision to go hosted was not a difficult one.

UC, on the other hand, is a platform that integrates many applications, including VoIP. This presents more challenges for UC vendors, but also new opportunities once the complexities have been addressed.

A key reason why UC has been slow to gain acceptance is the difficulty of integrating not just the various communications applications -- such as voice, chat, video, email and fax -- but also the various elements that are supported by a network -- like the phone system; conferencing systems; and business applications such as Office, customer relationship management (CRM) and enterprise resource planning (ERP).

None of these were developed to interoperate with each other, but that is the product promise of UC. Vendors have worked hard to develop premises-based UC solutions that do this seamlessly, but that has proven to be difficult. As IT resources continue to be stretched, an easier approach was needed, and that brings us to UCaaS.

The "as a service" model has come into vogue mainly because hosted services are economically appealing, and the cloud has matured to the point where scale, security and reliability are pretty much enterprise-grade. These attributes may not be fully ready, but are close enough to have earned the trust of IT decision makers.

Communications applications have lagged with this trend as real-time modes such as voice and video are particularly challenging to support on a hosted basis. VoIP has been offered this way for some time, and, more recently, the other core UC applications have caught up, making UCaaS a viable alternative to premises-based solutions.

Another driver for UC as a service is the fact that many complementary applications that strengthen the value proposition are also hosted in the cloud -- often for quite some time. Prime examples include Salesforce for CRM, Dropbox for file transfer, Zendesk for customer support, and, on a broader scale, Office 365 for everyday desktop applications.

The common thread is that these applications are all offered on a subscription basis, where the enterprise does not own the software outright. In return, they receive ongoing updates, virtually 100% uptime, have the host manage the data storage, have variable scaling to always be right-sized, offer highly trained technical support, and provide on-demand access for employees from any broadband connection.

With so many UC-related applications already in the cloud, the pathway for UC as a service has become clearer. Not only has the technology been proven on a scale that enterprises demand, but the business model has gained enough currency to be used for UC.

Premises-based UC has mainly been offered by vendors with a telecom pedigree, and with that comes a strong product-based mindset. Over time, however, UC has increasingly become software-based, allowing it to fit more comfortably into the "as a service" model that most software offerings have now embraced.

How UCaaS is sold

The main takeaway is for businesses to be aware of how different the vendor landscape is with UCaaS.

Now that UC has almost fully evolved to being software-based, it can be offered "as a service" with few restrictions in terms of hardware. This means telecom vendors are not the only ones who can offer UCaaS. When call control can be managed from the cloud, the range of options for UCaaS providers opens up.

Since the core value now lies in providing a service rather than a proprietary phone system around which other applications must conform, service providers have become bona fide UCaaS players. Competitive operators have long been cloud-based -- namely competitive local exchange carriers (CLECs) and over-the-top (OTT) providers. For these providers, UCaaS is a natural extension of the hosted VoIP they are already selling to businesses.

As these operators continue to take market share from incumbent telecommunications providers, they too have become UCaaS providers. In most cases, these operators have partnered with third-party UC platforms that are then white labeled as their own brand of UCaaS. Along the same lines, system integrators have also entered the market, further demonstrating that you don't need to be a telecom vendor to offer UC.

This range of options is a radical shift in how communications technology is sold, and the main takeaway is for businesses to be aware of how different the vendor landscape is with UCaaS.

There are benefits to deploying UC as a service with each type of provider, and these need to be carefully considered. Enterprises will need more extensive preparation for a good buying decision, but, if there has already been success in using the "as a service" model with other applications, the research effort for hosted UC will be warranted.

Adoption drivers for businesses

Cost savings generally should not be a core driver for UC, whether it is premises-based or hosted. The main driver should be productivity gains, which, while difficult to quantify, have clear strategic value to management.

With UCaaS, the adoption drivers need to be built around the deployment model. In that regard, there are two prime considerations.

First will be the cash flow-friendly nature of UC as a service. With this model, UC can be entirely Opex-based, which is easier to justify for an IT department's budget than a premises-based offering. Not only does this reduce the risk associated with UC -- in terms of the ROI being difficult to quantify -- but it also allows for predictable cost control since licenses can easily be scaled up or down as needs dictate.

Second, UCaaS removes complexity from the equation, again reducing the risk of deploying a solution where the business benefits are not always entirely clear. Most IT teams will have challenges managing UC on their own. With a hosted provider, UC can be deployed more quickly, allowing those benefits to be realized early enough to validate the cloud as the right choice.

Furthermore, by letting the UCaaS provider manage all this complexity, IT departments can focus on other areas where they can add business value. Once this new equilibrium has been established, the business will be well-positioned to leverage the cloud as new applications come along and make UC an even more powerful enabler for collaboration.

Next Steps

Test your knowledge of UCaaS with our quiz.

Learn how the UCaaS market is growing for large enterprises.

Review how to make your cloud UC deployment easier.

Check out our predictions for growth in the UCaaS market.

This was last published in November 2015

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