Cloud/Hosted Communications Providers: Survey ResultsCloud/Hosted Communications Providers: Survey Results

Among other results, we found that a large number of providers were not ready with advanced Unified Communications capabilities.

The genesis of this survey occurred when a consulting project required creating lists of potential cloud/hosted based communications providers. Many partial lists were located, but these had erroneous and/or outdated information. A complete guide to the providers and their offerings could not be found. This survey attempts to fill the gap of service descriptions and offerings for cloud/hosted based communications providers.

Reducing costs is almost always the primary driver for considering a cloud/hosted solution. The first benefit is a controlled and predictable cost. Because the cloud/hosted site is shared with many other subscribers, the overall hardware, software and operations costs can be prorated over the subscribing organizations.

However there are other advantages that can accrue to the subscriber of cloud/hosted communications services;

* Flexible sizing--The cloud/hosted solution can expand or reduce the number of seats very quickly. This is especially useful when the number of active seats varies by season or for special events or situations, or emergencies.

* Business continuity/reliability--The cost of high availability (99.999%) may be beyond most budgets. Maintaining continued operations, and/or rapidly recovering communications services when a disaster occurs, is more affordable with a cloud/hosted solution than if the enterprise tried to produce the same level of business continuity on the enterprise site(s).

* Staffing--The enterprise IT staff responsibilities are significantly less with a cloud/hosted solution. The IT staff can be smaller and will not require expensive certification training to support premise based/owned systems. IT personnel handle service administration.

* Software--The enterprise does not have to deal with and pay for software subscription fees and licensing costs.

* Management--The enterprise does not have to allocate significant time to managing the solution. Enterprise management will deal with a contract that can have very specific deliverables and Service Level Agreements (SLAs).

* Features and functions--The enterprise can gain access to features and functions that are not available on their existing system/service or that are too expensive to implement.

Our survey provides material for understanding and appreciating the cloud/hosted communications market and providers. The survey was sent to 210 providers who promoted their communications services on their websites. A total of 60+ providers responded to the survey between late December 2010 and March 2011. The survey included 20 questions. A Sourcebook covering the details of each provider’s responses to the survey is available at http://content.webtorials.com/2011-uc-services-sourcebook.

The provider offerings are described in this article in a number of charts. The entries in all of the charts were taken from the provider responses--not from their websites--to ensure accuracy. No pricing information is provided because the cost of each provider’s services, features and function offered are too varied for a fair comparison.

This article presents seven of the 21 questions asked in the survey and the statistics of the provider responses with additional comments, to help understand what the responses mean to the enterprise.

The number of service providers that offer wholesale services was a bit more than 29%. 58% did not offer wholesale services. 13% considered the answer to be proprietary information. Some providers that were wholesalers also provided services directly to enterprises. Most of the providers that responded to the survey sold only to enterprises.

2010 saw a number of mergers, acquisitions and consolidations in this market. It appears that these business actions were directed towards creating larger and stronger providers. Nearly 13% experienced a merger, acquisition or consolidation. 78% did not change while 9% considered this to be proprietary information. There are still many small providers in this market, so it is very probable that the mergers and acquisitions will continue. A market served by 210 providers is probably not sustainable. Expect more mergers and acquisitions and possibly some bankrupt providers.

What name(s) describe your service?

These are generic names for the provider services, used as descriptive names, not the actual service name that is unique to each provider. As can be seen, many providers called their services by more than one name, which can be confusing for their customers. Providers even have different definitions for cloud and hosted services. Eight of the respondents used other names not listed for their services.

The survey found that 75% of the providers offered basic telephony services, 79% of the providers offered PBX services and 79% offered voice/audio conferencing services. When it came to video conferencing, only 37% offered this service and only 29% offered web conferencing, significantly less than expected. Unified Messaging was offered by 60% of the providers, Unified Communications was offered by 58% of the providers with mobile access support at 52%. The more sophisticated enterprises will discover that nearly half of the providers are not yet ready with these features (UC, UM and mobile access). This reduces the number of candidate service providers that can be considered by the enterprise.

When it came to call center services, the responses were widely distributed. For example, only 19% offered predictive dialing. At the other extreme, 77% offered Auto Attendant services. When an enterprise looks for cloud/hosted call center services, there appears to be no consistent definition of what these call center services should include.

As expected 96% of the providers have access through the Internet. The survey found that there are other network technologies available for the service access--35% through private lines, 44% through MPLS/ATM/Frame Relay and 56% through other IP based services (not the Internet).

There are several considerations when selecting the service network access technology. If the access is through the Internet, then the Service Level Agreement (SLA) has the customer demarcation point at the provider's site, not the customer’s location. Network performance is not included in the SLA. Secondly, some providers offer MPLS access to ensure voice quality, and the demarcation point moves to the customer site. Network performance is included in the SLA. Those services using the Internet cannot guarantee voice quality. Thirdly, private line access may be more expensive but ensures voice quality. Security is an issue for all access technologies but can be solved through a VPN or MPLS or private line access.

The phone is included in the service only by the 8% of the providers. The customer provides the phone in 21% of the services while 71% of the providers will mix provider and customer supplied phones. In some cases, the service only works with a specific manufacturer phones such as Cisco or Mitel phones. Other providers support a range of SIP based phones.

What is the geographic coverage for your service?

The geographic coverage outside of North America was specified in the survey as 12 different geographic territories. This international coverage varied considerably by provider. For example, one provider only supported one central European country, the U.S. and the Middle East. On-site maintenance and support was offered by 16% to 22% of the providers, depending on the geographic area. Premise equipment, such as phones, was offered by 18% to 40% of the international providers.

Conclusion
Overall, the survey was successful in generating a significant number of responses. Many potential responders (over 100) could not be reached (no replies to e-mail or phone calls) or the correct person was not identifiable. Some providers chose to opt out of the survey. Some of the websites were poorly developed and were confusing. I mentioned some of the problems locating the provider information in my blog, Hosted Voice Communications Providers Don't Communicate.