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Service Provider Leverage in Emerging Collaboration Markets

How can service providers participate in the booming cloud collaboration and communication market?

The rapidly growing cloud market and the significant shifts in the voice and data services marketplace have created unprecedented challenges and opportunities for service providers. While the challenges presented to service providers are numerous and of strategic significance, in the interest of brevity, I will focus on opportunities specific to cloud collaboration.

The Collaboration Market

Business OTT services like UC, UCC, and social collaboration are experiencing a surge in demand (Gartner predicts the collaboration market with grow to $21 B by 2018), and offer much greater margins than consumer OTT services, which are harder to monetize. As PWC observed in its recent report, service providers are especially well positioned to serve the business market given their preexisting relationship in business IT departments, and ownership of networks and infrastructure which allows them to offer best-in-market SLAs.

Three key drivers determine the success of cloud solutions and in particular cloud collaboration solutions  – 1) rapid adoption, 2) ease of use and 3) value, determined by a ratio of feature and functionality to price.

Point collaboration solutions (single application solutions) may offer ease of use and rapid adoption for a specific application, but they certainly lack value as compared to unified applications that offer multiple applications and capabilities. In addition point collaboration solutions challenge the notion of ease of use and adoption in the context of using technology in support of specific business processes. Improving any workflow through collaboration and communication requires the use of multiple applications – email, calendaring, document management, project management, social collaboration, im and presence, click to call and conferencing applications. Ease of use and rapid adoption are negatively impacted when users have to deal with multiple applications with different user interfaces, different login requirements and information silos while collaborating and communicating.

Collaboration and communication systems with tightly integrated applications, a unified user interface and consistent behavior across all applications, channels and devices without compromising ease of use and rapid adoption deliver the best value for businesses.  A typical business customer can deploy a single unified collaboration and communication system (UCC) and support a wide range of business processes critical to their operations and team members.  Users of these systems will need to learn only one user interface and adopt one system as they seamlessly navigate across applications, information sources and devices. There is no need to deal with a new user interface and a new information silo every time the user needs to work with a different application.
Service providers benefit from offering unified collaboration and communication systems that deliver a tightly integrated and unified user interface across applications, channels and devices because:

1.  A well Unified Collaboration and Communication system satisfies the 3 key drivers to the success of any cloud collaboration solution – 1) rapid adoption, 2) ease of use, and 3) value

2. Service providers can consolidate a number of point collaboration and communication solutions into one

3. UCC systems with the right architecture can serve as a platform for offering additional services

So how can service providers participate in the booming cloud collaboration and communication market?

The initial reaction has been to forge partnerships with prominent OTT services like Google and Microsoft and benefit from the demand built by them. This approach is shortsighted. It is tantamount to seeding the market for a potential competitor and accepting a greatly reduced role in the future. It gives service providers little more than short-term profits in the form of minimal “reseller” margins.  A more strategically sound approach is for service providers to launch their own OTT services, to take control of their customers’ data and to offer them branded OTT services aligned with their strategic and financial goals. By leveraging their own brand and their sales and marketing strength, service providers will get a much larger share of the revenue pie while protecting their customer base.

While service providers have network expertise, operational experience and sales and marketing prowess, they are understandably anxious about developing their own OTT applications. The risks of building a cloud based, scalable, simple to use and successful software product, under budget and in time to take advantage of a rapidly moving market are significant. To mitigate these risks, service providers should partner with innovative technology companies focused on specific OTT applications, with proven products and without any competitive threat. A number of service providers around the world have successfully adopted this strategy and are working with companies like HyperOffice. A provider of cloud based UCC, Social Collaboration, Federated Collaboration and Mobility, HyperOffice enables service providers to roll out high margin, private labeled cloud services deployed in the service provider infrastructure, HyperOffice infrastructure or any third party.

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More Stories By Pankaj Taneja

An MBA by qualification, Pankaj Taneja has more than six years of experience in the SaaS and web collaboration industries. Having seen SaaS grow from a niche sector to the next big thing in enterprise technology, he has a great enthusiasm and passion for the sphere. Pankaj has been working for many years at HyperOffice, one of the earliest players in web collaboration since 1998, an industry which now includes solutions from Google, Microsoft, IBM, Cisco, Oracle, Adobe and more. It is amazing being part of a pioneer in collaboration, riding a wave which only promises to grow.

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