As On-Premise PBX Market Moves to the Cloud, Microsoft Jumps to #2 in UCaaS

RENO, NV, June 9, 2021

New data from Synergy Research Group shows that the installed base of on-premise PBX users continues to erode as UCaaS and hosted PBX solutions gain favor and eat into the market. While the on-premise PBX share of total users is only dropping by half a percentage point per quarter, that represents strong growth for the much smaller UCaaS and hosted PBX segments. In Q1 the UCaaS user base grew by 46% from the first quarter of 2020. The biggest beneficiary of that growth has been Microsoft who is now ranked second in terms of UCaaS revenues, having been the fifth ranked company just two quarters previously. RingCentral continues to lead the market by a wide margin, while the other leading UCaaS providers are Mitel, 8x8, Vonage and LogMeIn. Ranked by subscribers rather than revenues, Cisco, Zoom and Fuze all feature more prominently. Total UCaaS subscriber numbers are now over 17 million and have doubled since the end of 2018. While growth is strong in all regions, the worldwide market continues to be dominated by the US which accounts for over three quarters of all UCaaS subscribers. Market development is still in the early days in most other countries, with only the UK, Germany and Canada having a reasonably substantial base of UCaaS subscribers.

“While RingCentral remains in a field of its own, there is a battle going on among the chasing pack of UCaaS providers. Microsoft was late to the party but is now growing strongly and is doubling its UCaaS subscriber base every six months,” said Jeremy Duke, Synergy Research Group’s founder and Chief Analyst. “The other two particularly high-growth providers are Zoom and Fuze. While neither of them make the top six when ranked by revenue, they both passed the one million subscriber mark this quarter. The good news for all of the vendors is that this is still early days for UCaaS and there are many years of high growth ahead as the vast PBX installed base gradually transitions to cloud-based services.”