Simcon3 2020, Are We There Yet? Alan Quayle
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"Are we there yet? Telecom Services' slow migration to IP." - Most of the marketing noise is utter bs - Basic landscape and sizing - CPaaS history, current status, and what matters - UCaaS history, current status, and what matters - Its all about the services - solving the core business communications problem (business phone systems), and locking that service in through solving specific business problems (programmability).
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Simcon3 2020, Are We There Yet? Alan Quayle
- 1. Are we there yet?
- 2. I want to tell you a story…
- 3. But Max never said that
- 4. Most ‘70s / ’80s TV was awful But what choice did we have?
- 5. It did get better by the ‘90s Thanks to competition & choice.
- 6. I want to tell you a story…
- 7. Its about a young-ish engineer working at BT on broadband access. Trying to change an incumbent’s intransigence.
- 8. FTTH Business Case 2-3k per home passed! NO WAY DSL Business Case But were selling E1 lines for 10k today! And anyway, is DSL future proof? Deer in Headlights Cycle
- 9. Let’s remember how low the UK was in VoIP That’s 1%, Eastern Europe was doing better
- 10. Thanks to DSL, competition & choice, things began to improve
- 11. Thanks to broadband, competition & choice, things also began to get more complex
- 12. Though people seemed happy to pay more for less thanks to bundles / buckets
- 13. In 2018 North American SIP Trunking finally exceeded TDM/Legacy VoIP 2015 2016 2017 2018 2019 2020 Legacy VoIP 12% 10% 8% 6% 4% 2% TDM 55% 50% 45% 39% 33% 28% SIP 33% 40% 47% 55% 63% 70% 0% 20% 40% 60% 80% 100% 2015 2016 2017 2018 2019 2020 CAGR Total # trunks (M) 37.5 36.7 36.4 35.8 35.5 35.3 -1% SIP Trunks (M) 12.4 14.7 17.1 19.7 22.4 24.7 15% SIP Trunk Revenue ($M) 3400 4000 4500 4900 5200 5400 10% Average Revenue per trunk ($) 275 272 263 249 232 219 -4%
- 14. VoIP is the horse to bet on!
- 16. Who Pays the Analysts?
- 17. Industry Noise is Dominated by a Few Companies, And Most of it is Utter Bollocks DIGITAL TRANSFORMATION 5G US LARGE ENTERPRISE NEEDS CLOUD API ECONOMY AI RCS UCAAS & CCAAS & CPAAS MITEL & AVAYA 2+1.8 = 5 DIGITAL BLOODY EVERYTHING PAY TO PLAY AWARDS BIASED QUADRANTS FASHIONABLE THEORIES INFLATED EXPECTATIONS FALSE WARS: MESSAGING BABS-ARTISTS
- 18. We’ve got a ‘Bit’ of an Unlevel Playing Field!
- 19. However, Numbers are our Friends in Understanding the Playing Field
- 20. Public CPaaS Communication Enabling Software and Platforms / Open Source Projects Business Messaging In-App Comms Enterprise Channel (Gamma, WWT, Verizon, AT&T, etc) Customer Communications. Contact center, messaging, trust, .. Programmable Telecoms/Comms Landscape Automation Technologies (bots, speech rec, analytics, workforce management, knowledge management, conversational interfaces, marketing automation) Employee Communications. Unified Comms, business telephony, phone systems, messaging, collaboration
- 21. Open Source Telecom Projects Enterprise Communications Democratized
- 22. Public CPaaS – those that identify as + do more than SMS © Alan Quayle 2019
- 23. Public CPaaS 2018 Revenue2019 Growth2020 Growth2021 Growth2022 Growth SIP Trunking Core API / Aggregation / Routing (voice and messaging) / minutes and messages / IVR / VASBusiness Messaging / Marketing2FA / Identity / Authenitcation / Fraud ManagementIoT CCaaS (Customer Comms / Collab - voice & video / chat)UCaaS (Employee Comms / Collab / messagEmployees Simple Descrip 2600Hz / Kazoo 10 30% 30% 25% 25% 10% 70% 20% 40 Refocused on C 46elks 8 25% 25% 20% 20% 100% 8 Swedish CPaaS Aculab 25 25% 25% 20% 20% 40% 20% 10% 15% 15% 80 Long establishe AeriaLink 5 45% 45% 40% 40% 60% 40% 20 Landline messa Amazon 180 75% 70% 65% 60% 50% 20% 20% 10% 145 Simple Notifict Apeiron (bought 2019 Konatel) 2 40% 40% 35% 35% 100% 3 Couple of years Apifonica (Dzinga) 10 35% 35% 35% 35% 15% 65% 20% 25 European CPaaS aql 20 35% 35% 35% 35% 60% 20% 10% 10% 80 Long establishe babl.biz 10 35% 35% 35% 35% 20% 60% 20% 20 UK-based CPaa Bandwidth 165 30% 30% 25% 25% 20% 75% 5% 400 NAR-focused vo BrightLink 20 40% 40% 35% 35% 10% 20% 35% 35% 30 Cloud based PB Callfire 25 40% 40% 35% 35% 100% 90 Voice/SMS cust Callr 5 35% 35% 35% 35% 15% 75% 10% 8 Paris-based CPa Cequens 45 35% 35% 35% 35% 10% 30% 45% 5% 5% 5% 125 MEA focus Cloudonix 1 100% 80% 70% 60% 100% Cloud based As CM 25 20% 20% 15% 15% 40% 50% 10% 100 Dutch Business CYDNE 15 35% 35% 30% 30% 65% 25% 10% 80 Notification ser Exotel 15 35% 35% 35% 35% 100% 120 India based CPa Flowroute (West) 15 35% 35% 35% 30% 40% 60% 50 NAR-focused SI FoneDynamics 5 25% 25% 25% 25% 100% 20 Australian CPaa hoiio 25 65% 65% 60% 55% 20% 60% 20% 45 Singapore base Infobip 400 10% 10% 10% 10% 25% 65% 10% 1800 Original A2P SM Intelepeer 170 25% 25% 25% 25% 20% 30% 15% 10% 15% 10% 240 CPaaS products Kaleyra 100 20% 20% 20% 20% 10% 40% 40% 10% 200 Roll up of busin Messagebird 95 40% 40% 35% 35% 15% 60% 15% 10% 180 Dutch aggregat MITTO 30 45% 45% 45% 45% 90% 10% 50 Swiss based B2 Mobtexting 10 25% 25% 25% 25% 40% 50% 10% 50 Indian business NTH 5 25% 25% 25% 25% 60% 40% 25 GUI based CPaa Plivo 32 40% 40% 40% 40% 15% 65% 10% 180 Voice/SMS API PlumVoice 20 30% 30% 30% 30% 70% 20% 10% 60 Cloud IVR expan RingCaptcha 2 50% 50% 50% 50% 100% 4 Voice/SMS auth RouteMobile 80 30% 30% 30% 30% 5% 25% 40% 10% 10% 10% 400 Indian business SAP 500 0% 0% 0% 0% 30% 60% 10% 1000 Legacy Sybase A Signalwire 10 100% 90% 80% 70% 100% 25 FreeSwitch's CP Simwood 10 50% 50% 50% 50% 20% 70% 10% 15 ITSP Enabler gr Sinch (CLX) 450 15% 15% 15% 15% 45% 40% 10% 5% 400 Swedish roll-up Syniverse 600 0% 0% 0% 0% 80% 20% 1400 Legacy A2P agg Bottom-up Build of Market Size Yes, I know these growth figures are conservative compared to your business plan, but reality!
- 24. CPaaS Market Sizing 0 2000 4000 6000 8000 10000 12000 14000 16000 2018 2019 2020 2021 2022 Public CPaaS Revenues SIP Trunking Core API Business Messaging Authenitcation IoT CCaaS UCaaS Total IDC Market size estimate is $2B in 2017, $11B in 2022
- 25. Employee Communications UC, business telephony, phone systems Messaging and collaboration This is not complete, limited by who I know, please let me know what I’m missing, thx. There’s a load more providers, this is just a sample.
- 26. 2018 revenue either published or guestimate Growth either based on published #s or guestimate %aaS / hosted guestimate Employees based on published numbers or guestimate Employee Communications % aaS (includes hosted) UC / Enterprise Telephony 2018 Revenue2019 Growth2020 Growth2021 Growth2022 Growth 3CX 22 25% 25% 25% 25% 10% 4Com 20 20% 20% 15% 15% 15% 8X8 280 20% 20% 20% 20% 100% Aircall 18 55% 50% 45% 40% 100% ALU Enterprise / Sipwise 380 0% 0% 0% 0% 10% Amazon Chime 25 45% 45% 45% 45% 100% AMP Telecom 1 20% 20% 20% 20% 100% Audiocodes 50 10% 10% 10% 10% 20% Avaya 1200 -10% -10% -10% -10% 5% Birchills Telecom 1 10% 10% 10% 10% 100% Blueface / Star2Star 260 20% 20% 20% 20% 15% Broadview / Windstream Enterprise 220 0% 0% 0% 0% 10% Broadvoice 45 15% 15% 15% 15% 50% Centile (part of Within Reach) 15 20% 20% 20% 20% 100% Cisco 800 5% 5% 5% 5% 10% Crexendo 15 10% 10% 10% 10% 80% Dialpad 50 40% 40% 40% 40% 100% Digium 30 15% 15% 15% 15% 50% Dzinga 5 50% 50% 50% 50% 100% EvolveIP 55 25% 25% 25% 25% 80% Flat Planet Phone 1 15% 15% 15% 15% 100% Fuze 125 25% 25% 25% 25% 100% Grasshopper (bought by Citrix/GoTo) 30 15% 15% 15% 15% 100% Huawei 650 20% 20% 20% 20% 5% Intelepeer 180 20% 20% 15% 15% 80% Intermedia 125 10% 10% 10% 10% 50% Intulse 3 25% 25% 25% 25% 100% ipcortex (bought by Aerial Direct) inc Aerial Direct #s18 18% 18% 18% 18% 50% Jive Communications (bought by Citrix/GoTo)80 35% 35% 35% 35% 100% Magicjack (for business) 30 18% 18% 18% 18% 100% Megapath 32 15% 15% 15% 15% 35% Microsoft 700 20% 20% 20% 20% 20% MightyCall 20 15% 15% 15% 15% 100% Mission Labs (CircleLoop) 1 200% 150% 100% 80% 100% Mitel 300 10% 10% 10% 10% 20% Natterbox 15 35% 35% 35% 35% 100% NEC 230 5% 5% 5% 5% 5% net2phone 10 5% 5% 5% 5% 100% Nextiva 140 20% 20% 20% 20% 100% Univoip (OfficeConnect) 25 10% 10% 10% 10% 100% onsip 13 15% 15% 15% 15% 100% ooma 55 18% 18% 18% 18% 100%
- 27. UC Market Sizing 0 2000 4000 6000 8000 10000 12000 14000 16000 18000 2018 2019 2020 2021 2022 Enterprise Voice / UC Total Large Small • But wait a minute, UC market is $33B in 2021! – Telcos, mobile PBX, list is not complete (especially smaller players), doesn’t include channel margin – At least 50% of the UC market is up for grabs from the telcos! • Of small players approx 80% use open source telecom software. Average age of companies is 6.5 years old. • For small players 50% of revenue is from cloud/hosted services • For large players 30% is from cloud/hosted because legacy revenues tend to be on-prem
- 28. • RingCentral, Microsoft, Cisco, Zoom, 8X8 are not destined to own UC – Unless you’re a large US corporation with loads-a-money – Be opportunistic with these ecosystems, store brand and ‘named’ brand offers • Most businesses do not want UC, it’s called a bloody phone system • Most businesses do not have an IT department, hence a local person they can trust that makes it easy for them matters • Most people are frugal, saving money >> long lists of features Beware False Narratives Ignore the Noise, focus on your customers
- 29. Who’s Your Customer? All Your Businesses Survive Because of Diversity
- 30. • Open source telecom software underlies the majority of the Programmable Communications Market ($100B+ revenue) – 82% of web app servers are open source – the same be true for Programmable Telecoms (for small / medium players) • Open source community is the best defense for smaller providers – Raising all boats in the open source tide – Employee Communications for small players $4B (2018) growing to $8B (2022) – Likely $10B up for grabs in the coming decade by focusing on the customer: trust, local, easy, price Beware False Narratives Ignore the Noise, open source works at scale
- 31. Open Source Opportunity Cost Time spent earning $$$ on your core business Time spent having fun updating to the latest release to save $$ Over time Costs Saved (can be) < Revenue Forgone Because its not core to your business
- 32. • Everyone’s talking CPaaS, so I need a CPaaS offer! – Twilio has won, Google / AWS define developer expectations – HOWEVER – Most businesses want solutions to business problems • Faster, cheaper, better – Which means most customers want services not APIs • They need to alert customers, not integrate a SMS API – research, define the service, hire a developer, project, time, money, support – Most channels can’t use an API, their customers can’t use an API. • Why focus on APIs? • You need a partner that does the API stuff, so you can focus on your customer with appropriate services Beware False Narratives Ignore the Noise, focus on the services
- 33. Its all about the services
- 34. No, seriously. Stop focusing on the tech and Analyst BS Its all about the services
- 35. OK, but which services? • Great value phone system backed by unmatched local support • Programmable (configuration or APIs) to solve your customers’ specific problems Ignore the Noise, focus on the specific services your customers need
- 36. Are we there yet? No, but the path is getting clearer
- 37. Just don’t go too local