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UCaaS Market 'Overbloated,' More Consolidation to Come

By Claudia Adrien | April 17, 2023
Conferencing and collaboration

It’s no mystery that the pandemic supercharged the demand for UCaaS solutions. For Allan Jaffe, vice president, technology, Top Speed Data Communications, setting up these solutions was the simple piece. The human element was more complicated during the pandemic.

“I always thought that when the pandemic started, the more challenging issues had less to do with technology and more to do with HR,” Jaffe said. “So, in other words, if we're working from home, you could abuse your work time. On the other hand, your employer can also really abuse you. We saw some very public abuses.”

Living through COVID-19 also meant the explosion of the number of UCaaS providers.

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“Everybody provides UCaaS, whether it’s their platform or white label or somebody else’s brand. There are a lot of choices for technology that advisors like us have to make for clients to narrow down the field,” Jaffe said.

These realities in the UCaaS market are just some of the topics that a panel will tackle during the discussion, "The Present & Future State of the UCaaS Channel: Meet Today’s Challengers," May 2, at the Channel Partners Conference & Expo in Las Vegas.

Four panelists will discuss the opportunities for channel partners looking to work more closely with UCaaS providers. They will also touch on topics such as consolidation in the industry and factors forcing cost reductions.

Top Speed Data's Allan Jaffe

TeamKC Telecom's Cynthia Ferrell

“I do not see UCaaS slowing down at all. And it's not just because of my blind faith in the solution,” said panelist Cynthia Ferrell, vendor agnostic technology consultant at TeamKC Telecom.

However, there is a caveat.

“There's going to be consolidation,” Ferrell said. “[UCaaS] is an 'overbloated' market. It's like what we're seeing with cybersecurity right now.”

The panelists agreed the UCaaS market was rapidly changing post pandemic.

“We saw significant hiring and spending from the UCaaS providers during COVID, chasing more revenue and trying to continue that growth trend. It was a systematic flaw throughout the industry,” said Robert DeVita, CEO and founder, Mejeticks.

DeVita added: “We also saw record spiffs being offered. It’s not a sustainable business model, and we are now seeing the ramifications of those decisions. We are seeing fewer resources dedicated to the channel and a shift from channel to direct. There are some specific examples I can share on this in regard to 8x8 and RingCentral. For example, RingCentral has increased its commissions to the direct sales teams for non-channel deals. I think we will see more of this in the future.”

Mejeticks' Robert Devita

Bluewave's Kate Jaffe

For Kate Jaffe, business development consultant at Bluewave Technology Group, the future is promising for UCaaS.

“AI, ChatGPT and application integrations will continue to develop,” Jaffe said. “However, I believe some of the last holdouts of premise-based PBX companies will finally come to fruition. I am seeing some of my longtime, never-leaving-Avaya customers start to agree they need to look at UCaaS.”

Tags:
Channel Partners Conference & Expo, UCaaS