Communications-as-a-service is starting to take hold worldwide and
will rope in a total of $251.9m by year's end, according to
forecasts released by Gartner.
The $251.9m total is a jump of 37.6% over last year and an
indicator that the market for communications-as-a-service will
continue to climb as providers learn more of the particulars.
Gartner predicts that the communications-as-a-service market will
hit a whopping $2.3bn by 2011, representing a compound annual
growth rate of more than 105% for the period.
One reason communications-as-a-service isn't exploding out of
the starting gate, however, is lack of provider knowledge.
According to the report, providers are still trying to determine to
whom to define, package and market services as a value-added IP
telephony offering.
In the report, titled "Emerging Communications Services (Hosted
IP Telephony, IP Centrex and CaaS), Worldwide, 2006-2001," Gartner
defines communications-as-a-service as IP telephony that is located
within a third-party datacenter and managed and owned by a third
party. The assets are not carrier-grade, the service is not in the
network, and the assets are multi-tenant in terms of usage, Gartner
says.
But the growth of communications-as-a-service within
corporations will take off once users find its true usability,
according to Eric Goodness, research vice president at Gartner. It
will grow further as companies realise they won't run the risks
associated with having their own in-house communications
systems.
"Users will begin to embrace communications-as-a-service more
enthusiastically in 2009, attracted by predictable costs for fixed
telecoms," Goodness said. "Users will also be attracted to
communications-as-a-service as a means of shifting technology risk
to the service provider. Technology obsolescence will be more
easily managed by a scalable third party."
The largest growth for communications-as-a-service will occur
between 2010 and 2011, when the market jumps from $1.2bn to $2.3bn.
In the years leading up to the market's boom,
communications-as-a-service will grow gradually, hitting $576.2m in
2008 and $742m in 2009.
Communications-as-a-service's slow start will be compounded by a
longer sales cycle, Goodness said, as users need time to get used
to higher, but better consolidated, pricing.
"A single bill that consolidates telecom services with equipment
infrastructure will gain acceptance," he said. "Providers are
bullish about communications-as-a-service's potential because of
the opportunity to bundle more new features and capabilities to
avoid service commoditisation."