Buying UCaaS/CCaaS: If You Don't Evaluate Beyond Features You Could Be Making a BIG Mistake

By Kirk Waddell, EVP of Technology, One Source

As many businesses are now being forced to migrate away from premise-based voice solutions both due to carrier’s increasing rates for traditional POTS/TDM services to premise-based manufacturers discontinuing production of parts for their respective premise-based hardware, the immediate thought is to evaluate based on pricing, features, and platform. However, if your evaluation stops there you could be making a bad choice for you and your business.

Many UCaaS and CCaaS providers experienced a business BOOM thanks to COVID as IT and business leaders scrambled to support a newly distributed workforce. This cash windfall led to many of these providers over-investing in head count and marketing to support business growth. Coupled with the high market demand during this time, the UCaaS/CCaaS providers became entangled in a price war to obtain market share (due to similarities in features and technology) in addition to providing indirect sales channels with commissions and financial incentives well above industry standard. Now that the wave of “COVID adopters” has waned, many of these providers are feeling significant financial pressures. This has led to a trim of the workforce supporting these platforms as well as consolidations/mergers of UCaaS and CCaaS providers, both of which have negative consequences for the customer. If you are a customer caught in either scenario, you could see elongated service requests and mean time to repair, as well as possible service interruptions due to consolidation of platforms as the result of mergers and acquisitions, which are completely outside of the control of the customer.

In addition to workforce reduction and mergers to maintain financial viability, they are also re-evaluating existing products and partnerships with other providers to maximize EBITDA and improve financial position. For example, many UCaaS providers originally partnered with pure play CCaaS providers to fill this gap in their product portfolio and avoid the capital investment needed to build out their own platforms. However, as these same partners have felt the downward financial pressures referenced previously, they have had to change their pricing to these UCaaS providers. This has led to messy “divorces” in which UCaaS providers make the decision to either build their own platforms or look at more cost-effective CCaaS partner. The end result is the customer being caught in the middle and experiencing degraded support and/or being forced to go through a platform conversion due to the dissolvement of these previous partnerships.

Bottom line is, if you are currently evaluating UCaaS and CCaaS solutions for your business (and if you are not you need to start TODAY) you need to partner with a trusted technology advisor that has visibility of the market beyond just the pricing and feature set of the providers and has a pulse on what’s going on “behind the curtain” or you could be making a critical mistake in procurement for what many call the lifeline of their business.