The CPaaS Opportunity for Service Providers
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Raúl Castañón MartínezSuivre
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The CPaaS Opportunity for Service Providers
20 Jul 2018•0 j'aime•1,339 vues
7 j'aime
Soyez le premier à aimer ceci
afficher plus
vues
Nombre de vues
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Sur Slideshare
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CPaaS has been around for over a decade but in the last three years it emerged as one of the fastest-growing segments within business communications. Service providers have been an integral part of the value chain from the beginning but the market has been largely defined by CPaaS providers. In this webinar we look at the CPaaS competitive landscape and the implications for service providers looking to benefit from this opportunity.
Raúl Castañón MartínezSuivre
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The CPaaS Opportunity for Service Providers
- The CPaaS Opportunity for Service Providers Raul Castanon Sr. Analyst Workforce Productivity and Collaboration
- 451 Research is a leading IT research & advisory company 2 Founded in 2000 250+ employees, including over 100 analysts 1,000+ clients: Technology & Service providers, corporate advisory, finance, professional services, and IT decision makers 50,000+ IT professionals, business users and consumers in our research community Over 52 million data points published each quarter and 4,500+ reports published each year 2,000+ technology & service providers under coverage 451 Research and its sister company, Uptime Institute, are the two divisions of The 451 Group Headquartered in New York City, with offices in London, Boston, San Francisco, Washington DC, Mexico, Costa Rica, Brazil, Spain, UAE, Russia, Taiwan, Singapore and Malaysia Research & Data Advisory Events Go 2 Market
- 3 • Background and Operational Definition • Competitive Landscape • Market Opportunity • What role do CSPs play in the value chain? • Key Takeaways Agenda
- 4 • CPaaS has been around “officially” for about 10 years. • It is typically associated with the emergence of cloud-based providers of telecom APIs like Twilio and Nexmo. • This narrative puts the spotlight on cloud-based providers even though CPaaS was initially defined in terms of PSTN connectivity. A bit of background information on CPaaS
- 5 CPaaS is used to identify a wide range of approaches for delivering voice, video, chat and messaging APIs
- 6 CPaaS Market Segmentation Source: 451 Research “Four categories defining the competitive landscape for communications PaaS”, 2018 Connectivity Geographic coverage API offering Go-to-market • PSTN access • US-only: Bandwidth • Horizontal focus: Twilio • CPaaS enablement: TeleStax • IP-based services: BlackBerry • Global: Twilio, Nexmo, CLX, Infobip, Plivo • Specialized CPaaS (vertical): Vidyo, Voxeet, TokBox • CPaaS: Twilio, Nexmo, CLX, Infobip, Plivo
- 7 4 Major categories in CPaaS competitive landscape Source: CPaaS Preliminary Market Revenue Summary, 451 Research (2018) 18+ Vendors tracked in 451 Research’s CPaaS market monitor database 31% Projected CAGR for CPaaS for the next five years Competitive Landscape
- 8 • CPaaS is emerging as one of the fastest growing categories in business communications. • CPaaS plays a critical role when it comes to digital transformation, redefining how organizations create and deliver value. • CPaaS will provide the underlying infrastructure for emerging technologies driving business communications: mobile-native communications, digital assistants, voice commerce. Market Opportunity
- 9 Market Opportunity: 29% of companies have a formal strategy for digitizing their businesses
- 10 Improving the customer experience is the top driver for software investments
- 11 • Platform model • Pay-as-you-go • Zero Marginal Cost • Value based on supply-demand interaction • Developer-focused • Strong investment in R&D CPaaS Competitive Landscape
- 12 • Strong focus on engineering and development of new products, features and functionality and enhancements • Turning the traditional SaaS model upside down: • R&D team is nearly 50% of company’s headcount of ~1,000 employees • R&D expenses for 2017 were $120.7m or 30% of revenue • Sales and marketing organization has 358 employees Twilio
- 13 CPaaS Evolution CPaaS Pure Play Enterprise Communications CSP + CPaaS Enablement • Twilio • CLX / Xura / Sinch / Mblox • Bandwidth • TeleSign / BICS • Freespee • Cisco / Tropo • West / Flowroute • IntelePeer • Alcatel-Lucent / Sipwise • Mitel / ShoreTel • TeleStax • Embedded RTC • Enterprise
- 14 • Real time communications are emerging as a critical component for digital transformation. • The enterprise segment presents different challenges to the traditional CPaaS market of developers and startups. • CPaaS providers have defined the space but CSPs are uniquely positioned to benefit from this opportunity. • The key question is where do CSPs choose to play in the value chain. Key Takeaways
- Thank you! Raul Castanon @rcastanonm
Notes de l'éditeur
- 0:45 Hello everyone! Welcome to the webcast. Thank you for joining us today. Let me kick it off with a quick overview of the topics we will be covering: We will start with a quick background information and an operational definition for CPaaS We will then look at the competitive landscape for CPaaS, IOW who is going after this opportunity? Next we will talk about the role that CSPs can play in the CPaaS value chain, and why we believe they should pay attention to the market opportunity We will close the first part of the webinar with key takeaways I will then hand it over to Kevin, who will tell us a bit more about how TeleStax and CPaaS enablement.
- 1 min 30 sec Let’s start our discussion with some background information on CPaaS: CPaaS has been around for over 10 years. The term was initially associated with the emergence of cloud-based providers of telecom APIs such as Twilio and Nexmo. To be more precise, providing APIs for accessing the PSTN has been around even longer (20 years) with a number of initiatives from vendors and TELCOS. But the industry mostly agrees on placing the emergence of CPaaS around 2008 (which is the year Twilio was founded). The interesting part about this story is that it leaves out the role that service providers have played from the beginning. It also puts the spotlight on cloud-based providers, rather than TELCOS, even though in its early days CPaaS was defined in terms of PSTN connectivity.
- 45 sec So with this background information, where are we ten years later? This question brings us to the second topic in our intro, which is a baseline definition for CPaaS. The definition for CPaaS that we use at 451 Research refers to vendors that provide technologies (APIs, SDKs, and libraries) that enable developers and enterprises to integrate real-time communications into their web and mobile applications.
- 2:12 A problem with this definition (and with CPaaS in general) is that this is a segment largely vendor-defined. By this we mean that it is widely used by vendors looking to articulate their value proposition. The term is used somewhat loosely to identify a wide range of approaches for delivering communication APIs. This is not a bad thing in itself. This is a segment that is still emerging and rapidly evolving so it makes sense to articulate their value proposition in terms that will be more familiar to their audience. The problem is when we try to compare these vendors side-by-side. To address this problem we recently published where we map the competitive landscape for CPaaS. We identified a total of 18 vendors (and there are many more) and defined a framework that builds on four major criteria to identify how vendors define their product and go-to-market strategies. More importantly, it helps us understand who is going after this opportunity? The four criteria are: Connectivity: Does the vendor provides PSTN access, IP-based services, or both? Geographic coverage: Basically segmenting into US and ROW API offering: Does the vendor focus on specialized APIS (like video-only) or offer a wide range of communications APISs? Go-to-market: Is the G2M strategy based on partnering with CSPs? CPaaS enablement is an interesting development in this segment that we believe can be a game changer.
- 3:00 I’d like to share with you the preliminary results for a report that 451 Research will publish later this month. Our Market Monitor report looks at the CPaaS segment to identify key players and provide a market forecast and analysis. As I mentioned these are preliminary results so keep in mind the final report will look slightly different to what I’m showing you today: We have identified four major categories to define competitive landscape We currently have identified 20+ vendors The methodology for our MM report is a bottom up analysis which entails looking at key vendors, revenue, projected growth and aggregating all data into our forecast Our projected CAGR is 31%. $1.6bn in 2017, growing to over $6bn by 2022. This does not include aggregating which is largely commodified. Rather we are looking at services and interactions that are mission-critical and require enterprise-grade reliability.
- Let’s talk about why we believe CPaaS is emerging as one of the fastest growing categories in business communications. The early definition of CPaaS, in terms of PSTN connectivity, has been surpassed. The definition has been augmented, given the broad range of services now available. What hasn’t changed: CPaaS plays a critical role when it comes to digital transformation, enabling companies to redefine how they interact with partners, customers and employees. Think about how companies like Airbnb, Lyft and Uber have disrupted verticals such as hospitality and transportation by leveraging P2P and A2P communications to enable interactions between suppliers (drivers) and consumers (riders). These companies have redefined not only the end user experience but how organizations create and deliver value. These companies are largely the reason why CPaaS vendors have grown so much in the last five years. We are now starting what can be considered as the second stage in the evolution of CPaaS (some refer to it as CPaaS 2.0). A key driver for this stage will the enterprise segment (in contrast to the initial adopters which were mainly developers and startups).
- 45 sec How do we look at this market opportunity? Companies like Uber, Lyft, Airbnb, WhatsApp are the early adopters but we believe these are just the tip of the iceberg when it comes to the CPaaS market opportunity. We expect significant growth in the next five years as a result of more organizations launching digital transformation initiatives. I’d like to share with you a couple of data points from 451 Research’s VoCUL survey on digital transformation. This is a quarterly survey with a panel of 1,500 IT decision-makers, looking at business technology buying plans. Survey results show that only 29% of organizations have a formal strategy while a majority are either in the planning stage or have not yet started. We believe this indicates that we are in a transition point between the early adopters to more mainstream users.
- 20 sec What does digital transformation mean and what is the market opportunity for CPaaS and CSPs? Our VoCUL survey results show that the top priorities for organizations are improving the customer experience and reducing costs through operational efficiencies. What this means is that enterprises are looking for technologies that will help them solve business problems. We don’t typically come across companies that are looking for CPaaS as such but rather, technology that will help them improve the customer experience for example using push notifications, voice and video click-to-call capabilities, two-factor secure authentication.
- Let me go back to the competitive landscape topic for a bit. We talked about how the market will grow in the next five years, with the enterprise segment as a key driver. We believe this opens up an interesting opportunity for CSPs. A key aspect to consider is that there is a fundamental shift in the way in which communication services are delivered and consumed. CPaaS vendors are prepping for the shift but the market is also changing for them. CPaaS providers are largely considered a threat, but they are also paving the way for CSPs to redefine their business strategy, providing a framework for delivering and monetizing real-time communications. We believe this framework represents a compelling option for them. The evolution of enterprise communications has a number of risks and opportunities for CSPs. We believe the key will be getting the business models and go-to market motion right. The model will look similar to what CPaaS vendors look like now but it will have to be adapted to both the enterprise and the CSPs strengths.
- Let’s take Twilio as an example of what the CPaaS competitive landscape looks like. Twilio has been around for over 10 years and it’s fair to say that it has almost single-handedly defined the segment. It is interesting to note that in its early years the company defined its value proposition centered on connectivity to the PSTN.
- The main point I’d like to make is that while the platform model has worked really well for CPaaS vendors like Twilio and Nexmo it is now shifting. The main reason is the market opportunity that the enterprise segment represents. The way we see the segment evolving is: First, players are diverging into two large camps. The CPaaS pure play, which is how Twilio has defined its strategy. Other vendors following their lead include CLS with the acquisitions of X, Y, Z, Bandwidth, and emerging vendors like Freespee. The other camp is where vendors like Cisco / Tropo are gravitating and includes others like ALE with its acquisition of Sipwise, as well as MITEL. Vendors like IntelePeer kind of fall in between but the lines are somewhat blurry anyway. A third camp is where we see CSPs playing, in partnership with CPaaS enablement providers. This is actually a more recent development but with huge potential, given their position as providers of enterprise communications. We think that for CSPs to play in this space they will have to adapt the platform business model by adopting some practices that may be even counterintuitive to their traditional game. This is where CPaaS enablement comes in. So more than the technology itself, we see CPaaS enablement as a key component for CSPs to redefine their business model and monetization strategy, and insert themselves higher up in the CPaaS value chain. The fact that Bandwidth and Flowroute are both competitive local exchange carriers (CLEC), which makes the landscape even more interesting for CSPs. It’s all about how embedded RTC will transform the enterprise.
- Conclusions: there is a huge market opportunity. But there are other companies (with deep R&D pockets) going after the same enterprise opportunity. However you are closer than you think enablement. The heavy lifting work has been done by the enabler. They already have SLA, relationship with customer, network all of this gives them a headstart. To wrap up this part of the webinar, I’d like to share key points and takeaways. (Read out) -- I will now hand over to Kevin who will share. Kevin– over to you.