Avaya-RingCentral Partnership: Cloud Wins!

Avaya-RingCentral Partnership: Cloud Wins!

Strategic partnership reflects the growing adoption of UCaaS and CCaaS, and is a positive move for both companies.

The strategic partnership Avaya and RingCentral announced last week (see No Jitter coverage here and here) is remarkable in many ways, but perhaps most of all, reflects the growing market strength of cloud-based UC and contact center offerings.

In Nemertes’ recent “Workplace Collaboration: 2019-20 Research Study,” we noted that one third of the 645 participating organizations were either using UCaaS alone for their calling needs, or were using UCaaS coupled with on-premises platforms. On the contact center side, almost half (45%) of respondents have adopted cloud-based services.

Our study also showed that the move to the cloud is accelerating: 43.2% of respondents currently using on-premises platforms said they’re either evaluating or planning to shift to UCaaS, while 62.6% of those using hosted, single-tenant solutions are considering or planning to move to UCaaS. On the contact center side, cloud adoption will grow to 55.3% by the end of 2020.

RingCentral’s $500 million investment in Avaya reflects this shift, and the growing market strength of cloud providers. RingCentral, with around two million announced endpoints, enjoys a market capitalization of $10.5 billion while the market cap for Avaya, with more than 100 million endpoints, sits at around $1.3 billion. The growth trajectories for pure-cloud solutions enable RingCentral to make an investment in Avaya, rather than the other way around (though it’s worth noting that one of RingCentral’s earlier investors was Cisco).

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