The News: Wainhouse has released our year-in-review summary of the on-premises and cloud-based calling market including insight from buyers and market size, combined with and our analysis. This study includes our estimate of the market size for 2022 and ranks the top 10 providers worldwide and in each major region.
Analyst Take: In Wainhouse’s release of its 2023 State of the Market Report on Enterprise Calling, it’s clear that Enterprise Calling is in the process of a massive consolidation. Just four vendors: Cisco, Avaya, Mitel/Unify, and ALE, will soon control the majority of on-premises licenses and hold the greatest opportunity for theses legacy licenses as they migrate to the cloud calling.
Vendors without these huge on-premises bases (i.e. Microsoft, Zoom, GoTo, Dialpad, 8×8, and Intermedia, all of whom have different value propositions), will still thrive, but for other reasons. Microsoft’s success is perhaps the best example here on the benefit of being natively cloud-based versus many of the legacy vendors who never really made the cloud conversion (but are now doing so through reselling RingCentral).
RingCentral stands alone having the privilege of straddling the legacy market migration through their critical partner relationships with Avaya, Mitel, Unify, and ALE — and the future market as an organically native cloud calling platform provider.
And most importantly, we see that after three years of video meetings, users want and need to use enterprise-sanctioned calling services for both in-app, desk phone, and mobile phone calling.
Without question, 2023 will likely shape up to be the year that defines the next two to three years, and we expect to see new and engaging cloud calling features, blockbuster consolidation, and the final year of rationalization of those millions and millions of online meeting licenses acquired during the pandemic.
Wainhouse estimates the cloud calling market grew by 22M licenses in 2022 while legacy on-premises dropped by 23M. Wainhouse has Q1 through Q3 data and have estimated Q4 2022, and actual numbers will come out in the Q4 2022 Enterprise Voice SpotCheck in March of 2023.
Nearly every multi-tenant cloud calling vendor has made impressive license gains throughout 2022. The large incumbent on-premises vendors have thrown in with RingCentral, including Avaya, Mitel, ALE, Atos, and others. To further consolidate the on-premises to cloud vendor migration, Mitel is in advanced talks to acquire Altos’ Unify calling base – including their RingCentral business.
Combined, Mitel and Unify have over 75M licensed users for voice, with a very small fraction as multi-tenant cloud-based (the RingCentral offering). The 75M+ voice clients resident in the Mitel/Unify user base match the 75m+ at Cisco. Wainhouse estimates Cisco’s Webex Calling base at YE 2022 to be ~9M, making their cloud conversion 10-15% of their legacy base – and offering huge upside for Cisco.
To be sure, 2023 likely holds some more surprises we are not yet seeing or thinking about. That said, cloud calling has become the critical win for each workplace communications platform vendor, and we are likely to see more moves from the vendors to differentiate and drive customer value and productivity.
This report explores user desires and preferences, the market, the ranking of vendors by region, and some thoughts about 2023.
For further insight on and/or access to this report, and to learn more about Wainhouse coverage of the entire workplace communications and collaboration market contact clientservices@wainhouse.com. In addition, you might be interested in a demonstration of our interactive intelligence portal, including coverage of five domains with intelligence reports, and 10 interactive visualization dashboards of datasets for workplace communication markets and total market opportunity. We’d love to walk you through it.
Disclosure: Wainhouse Research, part of The Futurum Group family of companies, is a research and advisory firm that engages or has engaged in research, analysis, and advisory services with many technology companies, including those mentioned in this article. The author does not hold any equity positions with any company mentioned in this article.
Analysis and opinions expressed herein are specific to the analyst individually and data and other information that might have been provided for validation, not those of Wainhouse Research as a whole.
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Image Credit: Webex
The original version of this article was first published on Wainhouse Research.Â
Author Information
As the Head of Futurum Intelligence, Marc works with The Futurum Group's talented pool of expert analysts and data scientists to deliver deep, accurate, and insightful intelligence the digital technology and services market relies on for critical decisions that drive growth.
Prior to The Futurum Group, Marc found and led Wainhouse, the leading industry research firm focused on workplace communications and collaboration. In August 2022, The Futurum Group acquired Wainhouse.
Marc began his career in Boston as an early member of PictureTel which eventually grew to $490M in revenues. In the early 1990’s Marc joined the founders of Polycom (now Poly/HP) in San Jose which eventually grew to over $1B in revenues and set the standard for high quality conference phones and group video conferencing systems. At PictureTel and Polycom Marc held roles in business analysis, product management, sales management, and business development.
Marc holds a Bachelor of Arts in Economics from Gordon College.
