G11.2012 caa s_magic quadrant for unified communication as a service caas north america

G00238492
Magic Quadrant for Unified Communications as
a Service, North America
Published: 19 November 2012
Analyst(s): Daniel O'Connell, Bern Elliot
UCaaS is a cloud-based delivery of integrated UC capabilities spanning
voice, messaging, conferencing and presence. Businesses of up to 5,000
employees are starting to deploy UCaaS, with expansion to larger accounts
expected in 2013 as offerings from larger UCaaS suppliers mature.
Market Definition/Description
Unified communications as a service (UCaaS) supports the same types of functions as its premises-
based counterpart. Only the delivery model is altered. Therefore, Gartner uses the same six broad
communications functions for both:
■ Voice and telephony. This area includes fixed, mobile and soft telephony, as well as the
evolution of PBXs and Internet Protocol (IP) PBXs. This also includes live multimedia
communications, such as video telephony.
■ Conferencing. This area includes separate audioconferencing, videoconferencing and Web-
conferencing functions, as well as converged unified conferencing capabilities.
■ Messaging. This area includes email, which has become an indispensable business tool, voice
mail and unified messaging (UM) in various forms.
■ Presence and instant messaging (IM). These play an increasingly central role in next-generation
communications, enabling the aggregation and publication of presence and location information
from and to multiple sources. This enhanced functionality is sometimes called "rich presence."
■ Clients. Unified clients enable access to multiple communication functions from a consistent
interface. These may have different forms, including thick desktop clients, thin browser clients
and mobile PDA clients, as well as specialized clients embedded within business applications.
■ Communication applications. This broad group of applications has directly integrated
communication functions. Key application areas include consolidated administration tools,
collaboration applications, contact center applications and notification applications. Eventually,
other applications will be communication-enabled. When business applications are integrated
with communication applications, Gartner calls these "communication-enabled business
processes."

Mobility, through smartphones and tablets, now plays a prominent role in the UCaaS ecosystem.
The more advanced mobility offerings provide PBX features into the mobile endpoints, obviating
traditional handsets in certain cases.
Magic Quadrant
Figure 1. Magic Quadrant for Unified Communications as a Service, North America
Source: Gartner (November 2012)
Vendor Strengths and Cautions
8x8
Northern California-based 8x8 is a publicly held company with 10 years of cloud voice over IP
(VoIP)/unified communications (UC) experience delivered over an internally developed platform. The
company's focus has traditionally been on small or midsize business (SMB) cloud VoIP. Starting in
2010, it offered a richer UC suite of services, and in the past 12 months, it has been targeting larger
accounts in the 1,000-employee range. The current mobility offering supports both smartphones
and tablets (iPhone/Android), PBX features, single-number reach, and unified messaging. In the
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third quarter of 2011, 8x8 acquired cloud contact center specialist Contactual to fulfill market
demand for integrated cloud UC and contact center solutions.
Most 8x8 users leverage the company's existing broadband infrastructure (that is, DSL or cable
modem). While providing a lower-cost basis, UCaaS delivered via broadband typically lacks the
reliability and service quality demanded by enterprise clients. As 8x8 seeks to expand into the
midsize market, the company has started to deliver services over more robust carrier-grade
networks (such as the customers' existing IP Multiprotocol Label Switching [MPLS] and Ethernet
networks).
The core 8x8 offering is branded as Virtual Office. The richer Virtual Office product includes Web
conferencing and multiparty videoconferencing, Internet fax and call recording. Services are
available across the U.S. 8x8 is preparing for a Canadian launch in the fourth quarter of 2012, with a
planned European launch in 2013. Supporting approximately 250,000 end users, 8x8 is one of the
largest North American suppliers of UCaaS. However, 8x8 is just starting to crack the 1,000-plus
employee barrier.
Consider 8x8 if you are a small or midsize enterprise looking for a cost-effective UCaaS solution.
Strengths
■ Pricing is very competitive as 8x8 has traditionally focused on the price-sensitive SMB market.
■ The company is experienced at automated, low-touch, self-service provisioning. Most users
activate themselves with a limited amount of remote support, which facilitates shorter 12-month
contracts.
■ The company has a role-based portal that supports self provisioning, moves, adds and changes
(MACs), bill paying, and individual employee management.
■ The company offers a broad UC suite of services that includes VoIP, IM/presence, UM, mobility
and conferencing. The multiparty videoconferencing and Web-conferencing offerings are
particularly strong for an SMB solution.
Cautions
■ The contact center functionality (acquired from Contactual) is not yet fully integrated into the
8x8 UCaaS solution. Gartner expects an integrated contact center functionality by the third
quarter of 2013.
■ The company has only recently been delivering business-grade services over IP MPLS
networks with committed SLAs. 8x8 has traditionally supported its price-sensitive customers
over broadband (for example, DSL and broadband).
■ 8x8 has traditionally been SMB-focused and is just starting to secure accounts in the 1,000-
employee range.
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■ 8x8 does not have a strong brand, despite supporting approximately 250,000 cloud UC
endpoints.
AT&T
AT&T is a global communications service provider (CSP) headquartered in Dallas, Texas, while the
UC group supporting business accounts is based in New Jersey and Massachusetts. AT&T has
more than five years of experience in cloud telephony through its BroadSoft-based Voice DNA
service targeted to SMBs. This solution is VoIP-centric, with limited UC functionality, such as
mobility and UM.
The cloud UC solution evaluated in this research is based on the Cisco Hosted Collaboration
Solution (HCS) platform, complemented with AT&T's internally developed UC infrastructure. It is
marketed to larger-enterprise accounts and is marketed in the U.S., Canada and 46 countries. AT&T
is now in a "controlled introduction" of its next generation of UC products as of the fourth quarter of
2012. This AT&T terminology means that there are active and paying customers, with sales focused
on a select base of accounts.
The new AT&T UC Services offering comes in two variations, both of which are based on the
underlying Cisco HCS platform:
■ UC Voice — This is a cloud-based alternative to a premises-based IP PBX.
■ UC Central — This is a downloadable client for PCs, Macs and mobile devices that offer a full
UC suite, including presence, IM, conferencing (audio, Web and video) and UM, in addition to
the voice and telephony functionality of UC Voice.
AT&T also offers a range of UCaaS-related services, including hybrid configurations of UC,
integrations with on-premises PBXs, and managed IP PBXs for Cisco and Avaya.
Consider the AT&T UC solutions if you have an existing strong relationship with AT&T; however,
Gartner strongly recommends you obtain and verify references who have deployed the same
functionality that you will be deploying.
Strengths
■ AT&T has strong brand-name recognition and global data centers that the UCaaS offering
leverages.
■ The company has robust wireless capabilities that are integrated into the UCaaS offering. The
recently introduced AT&T Toggle (bring-your-own-device mobile management with separate
work and business personas) further enhances its mobile portfolio.
■ AT&T possesses a large base of existing business telephony accounts that represent an
attractive target market for AT&T UCaaS.
■ The AT&T UCaaS solution includes significant amounts of internally owned and developed
functionality (for example, Web conferencing, presence and messaging, much of it from the
Interwise acquisition) that helps lower its cost structure. Alternatively, the AT&T back-end

infrastructure can also work with the market-leading UC clients — namely, Cisco Jabber and
Microsoft Lync.
Cautions
■ AT&T has been very slow in bringing its UCaaS offering to market (which Gartner believes is
partly due to a broader AT&T operations support system/business support system upgrade
delay). AT&T is in a controlled introduction in the fourth quarter of 2012. This lag to market
reduces its ability to compete effectively, and users should expect AT&T functionality to lag
behind that of other vendors that are faster to market.
■ Gartner was able to secure only one AT&T UCaaS reference (VoIP-focused) as part of this
research. However, AT&T states that it possesses numerous paying customers (controlled
introduction), as well as customer trials, both in North America and globally.
■ While having its own AT&T UC Central client allows incremental functionality and better
margins, R&D on the AT&T client may not be sufficient to allow it to remain as attractive and
functional versus those of competitors, which are using Cisco and Microsoft UC clients (which
AT&T UC Voice also supports).
■ AT&T currently lacks a complementary cloud contact center offering.
Azaleos
Note: As this report was being published, Avanade announced its intention to acquire Azaleos.
Avanade, also based in Seattle, is a global business technology solution and managed service
provider. Accenture is the majority owner of Avanade. The announcement indicated that Azaleos will
fold in under the Avanade brand and will operate as an Avanade business unit, providing Avanade's
current and future clients with the existing full set of managed service offerings for Exchange,
SharePoint and Lync.
Seattle-based Azaleos focuses on cloud and managed support of Microsoft applications, led by
Exchange, SharePoint, Active Directory and Lync. Azaleos has offices and network operations
centers in Seattle, Washington, and Charlotte, North Carolina. Azaleos provides managed services
in private cloud, on-premises or mixed hybrid architectures.
Azaleos is one of Microsoft's top partners. When Azaleos offers the products in an on-demand
model, it has a solution similar to, and somewhat in competition with, Microsoft Office 365. Because
Azaleos uses standard enterprise versions of these products, operated with Azaleos' own
management (ViewX) and virtualization tool, the feature functionality is comparable to that available
in the Microsoft on-premises releases. The Azaleos managed services for Lync, SharePoint and
Exchange are currently available in all global markets. Telephony (but not IM/presence and
conferencing) is a new (and therefore smaller) part of the Azaleos business. Azaleos' telephony
offering is based on Lync technology, through both on-premises PBX integrations and its cloud
offering.

Consider the Azaleos solution if you are looking for UCaaS versions of the Microsoft Lync,
SharePoint and Exchange solution suite.
Strengths
■ Azaleos has a strong Microsoft partnership, with extensive experience operating and managing
the Microsoft solution set for both small and large companies.
■ Azaleos is experienced in integrating UCaaS Lync, SharePoint and Exchange with the on-
premises infrastructure.
■ Azaleos is able to offer the full Exchange and Lync feature set, including IM, presence,
videoconferencing, UM, mobility and VoIP. These offerings provide greater customization and
control capabilities than what is available with Office 365.
Cautions
■ When offering Lync, Azaleos must rely on third parties that offer Session Initiation Protocol (SIP)
trunks, E911 support, data centers and network services. Furthermore, these third parties also
might be offering UCaaS.
■ Azaleos competes with Microsoft's Office 365, and while in the near term Azaleos is well-
positioned to differentiate, longer term, the distinctions may be reduced, and price may become
a factor.
■ Full UC solutions will require two contracts — one for Microsoft licensing and a second for
Azaleos support (including the platform, network, service management and data center).
■ Although quite experienced with IM, presence and conferencing, Azaleos has less experience
offering the full Lync solution — including mobility, video and telephony.
CSC
CSC is based in Virginia, U.S., and is one of the world's largest IT outsourcing companies. CSC has
$16 billion in annual global revenue, and it offers a broad and varied set of services through multiple
business units. In the area of UC, CSC offers managed services and private cloud across such
vendors as Avaya, Cisco and Microsoft. CSC is also one of the earlier companies to market with a
Cisco HCS-based UCaaS deployment and has multiple referenceable clients. This Cisco UCaaS
solution includes a strong mobility capability, although actual mobile implementations are in the
early stages. CSC's solution is a global offering available in regions beyond North America.
CSC plans to offer a Microsoft Lync UCaaS solution in late fourth quarter of 2012 (too late to be
evaluated in this Magic Quadrant). There is a professional services organization for assisting with
multivendor UC environments (for both cloud and customer premises equipment [CPE]), particularly
across the Avaya, Cisco and Microsoft platforms. UCaaS customers opting for CSC network
services are supported with an underlying Sprint IP MPLS network. In addition to providing UCaaS,
CSC offers video, contact center, collaboration and email as a service.

Consider the CSC UC solution if you want an established global service provider with a solution
based on Cisco HCS.
Strengths
■ CSC is a well-established hosting, managed services and cloud infrastructure provider with
data centers and customers around the globe.
■ CSC has a growing base of referenceable UCaaS customers on the Cisco HCS platform. Some
CSC customers have more than 1,000 activated users, with plans to expand to 50,000 users
over two years.
■ The company offers a good product road map and will be offering contact center with HCS
when this functionality is released as part of HCS 9.0.
■ CSC promotes its ability to port on-premises Cisco UC customers to an HCS UCaaS solution
and to facilitate license transfers. This is accompanied with professional services expertise for
working in a multivendor UC environment (for example, Avaya, Cisco and Microsoft).
Cautions
■ The CSC customer portal remains limited as it is focused on VoIP. Integrated portal support for
the broader mix of UC functions is expected in the second half of 2013.
■ UCaaS is a new offering to CSC as well as to Cisco. As a result, both are still learning and
adapting this new offering.
■ CSC customers report inconsistent customer service (often because various CSC business
units are not well-integrated), with a mix of satisfied and unsatisfied customers. This
characteristic is not specific to CSC UCaaS, but across CSC's IT support services in general.
Google
Google offers a rich set of UC and collaboration capabilities through Google Docs, Gmail, Google
Talk, Google Voice and Google+ Hangouts. Low-cost email remains the anchor application that is
driving adoption, with advanced email capabilities available (for example, encryption and archiving
for an additional fee) for more rigorous IT requirements.
Selected business customers have adopted Google Docs as a cost-effective replacement for
Microsoft Office Suite. IM and presence (via Google Talk) are embedded in Google Calendars and
Google Docs to promote collaboration across the business. A multiparty video capability is now
available through Google+ Hangouts. Google offers an integrated mobility capability for both
Android and iPhone devices. However, mobility is tied to Google Voice, which is not integrated into
the enterprise environment. Nonetheless, the UCaaS bundle is deep (outside of voice) and includes
IM, presence, Web conferencing, videoconferencing, mobility and email.
During the past year, Gartner has witnessed increased Google commitment to the enterprise
segment, as evidenced by a series of high-profile wins (for example, the Department of Interior and

the National Oceanic and Atmospheric Administration). However, Google has unorthodox customer
support and provides limited guidance on product road maps. Some popular Google products lack
deep enterprise IT administrative control (for example, Google Voice and Google+ Hangouts).
Businesses accept these limitations in return for significant cost savings.
Consider Google UCaaS if you seek a low-cost solution, have alternative methods of securing
enterprise voice, and have an IT department that is comfortable securing support through Google
partners (as opposed to Google directly).
Note that Google did not respond to requests for supplemental information, although Google did
review the draft contents of this document before publication. Gartner's analysis is therefore based
on other credible sources, including public information, Gartner analyst experience with Google
offerings and more than 10 discussions with users of this product suite.
Strengths
■ Service pricing remains very competitive. Users secure a broad set of IT capabilities for a single
annual fee of approximately $50 to $75 (with value-added services) per user.
■ Google's consumer legacy has provided it with a delivery architecture with a proven capability
to support large environments of more than 25,000 employees.
■ Google has a fast pace of innovation, as exemplified by multiparty desktop video and Web-
conferencing capabilities that are now part of Google+ Hangouts.
■ The company is strong in the public-sector vertical, and it offers dedicated infrastructure to
public-sector customers to fulfill regulatory requirements.
Cautions
■ Google Voice is a consumer offering that cannot be integrated into the enterprise IT
management. In addition, Gartner has seen less promotion of Google Voice, as evidenced by
the nonoccurrence of a previously planned European launching.
■ Traditional enterprise telephony support is the notable weak link with Google UCaaS. Google
relies on partners such as Esna for integration with business PBXs and cloud telephony (for
example, BroadSoft).
■ The Google UCaaS product suite is complex for businesses to understand. Businesses must be
careful to identify what products are generally available (as opposed to "preview") and what
products support enterprise controls.
■ Enterprises may find that consumer products (often free) that they are counting on to be offered
in a business version may instead be terminated with limited notice. Google is not shy about
terminating products that fail to secure market adoption or are incompatible with Google's
evolving technical direction.
■ The Web-conferencing capability available with Google+ Hangouts is adequate for internal team
usage. However, it lacks the scale and feature richness of the industry stalwarts.

Microsoft
Microsoft Office 365 provides cloud delivery of the firm's IT software applications originally
designed for on-premises deployment. The offering consists of four core applications: Exchange
Online, SharePoint Online, Lync Online and Office Professional. There are also a range of support
applications and mobility options. Office 365 is now supported in 88 markets and 32 languages,
with two or more data centers in each of the North American, European and Asia/Pacific regions.
While Microsoft Office 365 does experience isolated service incidents, a number of customers
report that the Microsoft Office 365 service availability actually exceeds what they could provide via
their internal staff.
This UCaaS assessment focuses on the two Office 365 applications that provide UC functionality —
Exchange Online and Lync Online. Exchange Online offers email and can store unified messages
that are forwarded to it from voice mail and email systems. Lync Online provides rich presence, IM,
Web conferencing, limited videoconferencing and limited VoIP. Current mobility capabilities include
single-number reach, UM and IM/presence integration (but do not include VoIP).
Users of Office 365 can acquire services directly through Microsoft or through channel partners that
offer value-added services. Gartner believes that direct support is the most efficient model in North
America. Channels will provide more value in the future, as Microsoft matures its real-time
applications and partners add network capabilities and E911 support.
Microsoft announced enhancements to the on-premises version of Lync — Lync Server 2013 —
which will be available in late fourth quarter of 2012. It has indicated plans to incorporate (Gartner
estimates the first half of 2013) some of these features into the Lync Online portfolio. Similarly,
Microsoft has indicated plans to integrate Skype with Lync Online — initially with basic IM/presence
and talk capabilities between the two. These are forward-looking statements, and actual availability
remains to be determined.
While the Exchange and SharePoint elements of Office 365 are suitable for businesses of all sizes,
most Lync Online adoptions appear to be from smaller distributed enterprises. Deployments focus
on IM/presence, Web conferencing and peer-to-peer voice. Use of telephony with Lync Online,
even via integration of Lync Online with on-premises Lync or with partner telephony deployments,
remains very limited. As this Magic Quadrant research was being finalized, Microsoft announced
that the Lync product team will now be merged and led by the Skype unit that Microsoft acquired in
2011, which Gartner expects to facilitate future integrations of Lync and Lync Online with Skype.
Consider the Office 365 UCaaS solution if you can accept the telephony, video and mobility
limitations. Many customers will opt to select a few proven cloud products that Microsoft has
shown to excel at via the cloud (for example, messaging and IM/presence).
Strengths
■ Office 365 is a strong brand, and Microsoft is marshalling significant corporate marketing,
technical, support and channel resources toward the UCaaS elements of the portfolio. The
company has largely met its product release commitments and has a solid product road map.

■ Gartner expects that when Lync Server 2013 functionality is available in the Lync Online offering
(estimated for the first half of 2013), this offer will both enhance telephony capabilities and
include limited Skype integration capabilities.
■ Business users are attracted to Office 365 for multiple reasons, including the pricing model,
ease of administration (for example, with Active Directory) and employee familiarity with
Microsoft applications.
■ User adoption has been significant; led by Exchange Online, and then with additional interest in
SharePoint Online; and the IM, presence and Web-conferencing functions in Lync Online.
■ Exchange Online is already supporting many large accounts of more than 25,000 employees,
both in North America and in other regions.
Cautions
■ Lync Online telephony is the least mature of the services in the Microsoft UCaaS portfolio. The
use of Lync Online for voice beyond pure Lync-to-Lync calling is limited, and enterprises should
not expect strong telephony functionality from Office 365 at this time.
■ Enterprises planning to migrate from on-premises Lync Server 2010 to Lync Online (cloud)
should carefully evaluate the features, functions and road maps. Some users have reported that
Microsoft has not explicitly articulated these details.
■ Customers continue to report that problem escalation can be sluggish (which Gartner attributes
to the recent high adoption), and complex problem resolution can be challenging.
■ Lync Online (limited PBX feature set) offers less functionality than is available with Microsoft's
on-premises version.
Mitel
Ottawa-based (Canada) Mitel uses the Freedom brand to promote consistent UC services across
devices and delivery (cloud or CPE). The core business focus is on small and midmarket accounts
of up to 3,000 employees. A virtualized architecture based on VMware allows applications to be
shared on CPE and cloud. At present, Mitel's cloud offering, branded as Mitel AnyWare, does not
include the full base of functions available with the CPE version.
Mitel AnyWare capabilities include telephony, UM, mobility, audioconferencing/Web conferencing
and contact center. A forthcoming cloud release will include IM, presence and video (at which time
it will have feature parity with Mitel CPE). Mitel runs and operates its UCaaS platform. Sales are
conducted both directly and through the existing base of CPE channels (often in a co-selling
arrangement). This model relieves Mitel channels from the complexity and costs of running their
own UCaaS platform. The Mitel UCaaS solution is available across the 50 U.S. states as well as in
other global regions (Europe and Asia/Pacific).
Consider the Mitel solution if you are looking for a UCaaS suite from a newly established UCaaS
provider. While larger enterprises can be served, current North American Mitel clients to date are
small to midsize.

Strengths
■ The Mitel UCaaS suite is based on virtualizing its established on-premises product. It includes
strong telephony and can also incorporate contact center functionality.
■ Mitel has an existing base of CPE channels, giving it the potential to quickly scale and reach a
broad market base.
■ Mitel AnyWare includes a Web portal to enable enterprises to manage users, profiles, call
handling and telephony customization.
Cautions
■ Mitel is new to the North American software as a service (SaaS) market, and while it
understands the technology well, it will have to prove that it can advance in this competitive
new market.
■ A segment of Mitel's existing CPE channels are unlikely to make the transformation to cloud
delivery (which possesses a different business model and requires a different technical
expertise).
■ The Web-conferencing (limited integration) and mobility (does not yet include PBX features)
elements of the Mitel AnyWare product are limited.
■ The current UCaaS feature set is not as deep as the CPE feature set.
PanTerra Networks
PanTerra Networks is a California-based, privately held UCaaS supplier that operates a proprietary
platform branded as WorldSmart. The company focuses on supporting the SMB market with a
cloud UC solution that is low touch (specifically, does not require extensive IT support). WorldSmart
is especially practical for highly distributed organizations that have remote sites with low employee
concentrations (that is, below 10 employees). Throughout the years, PanTerra has expanded the
feature set, which now includes VoIP, UM, IM/presence, mobility, conferencing, Web collaboration,
videoconferencing and contact centers.
Notable new capabilities offered by PanTerra since 2011 include multiparty video and a stronger
mobile offering for smartphones/tablets (including PBX feature sets, IM/presence and UM). In the
second half of 2012, PanTerra introduced a managed service capability that can be integrated with
carrier-class networks (IP and Ethernet). Finally, there is an ancillary cloud storage capability
designed to strengthen the SMB bundle.
Consider PanTerra if you are an SMB seeking a competitively priced, self-administered solution.
Most current PanTerra customers secure network connectivity via broadband.
Strengths
■ The new multiparty video capability supports both UC users and contact center agents.

■ PanTerra has a reputation for competitive pricing and strong customer service.
■ The WorldSmart UCaaS suite is intuitive and well-suited for businesses with limited IT
resources. Special emphasis is directed to Web-based (thin) clients to minimize the required IT
support.
■ Customers value PanTerra's call center functionality (with call recording), which provides
sufficient functionality for many SMB accounts.
Cautions
■ PanTerra lacks brand recognition in a highly fragmented UCaaS market.
■ The PanTerra solution focuses on SMB accounts, with limited customer accounts above 300
employees.
■ The multipronged distribution strategy — inside sales, master agents, value-added resellers
(VARs) and competitive local-exchange carriers — has yet to enable PanTerra to distinguish
itself in the marketplace.
■ The PanTerra Web-conferencing component has a limited feature set. Many users prefer to use
it mainly for internal communications, and they rely on a third-party Web conference tool for
external usage.
ShoreTel
Northern California-based ShoreTel acquired New York City-based UCaaS provider M5 Networks in
the first quarter of 2012 for $168 million. The core objective of the acquisition was to provide parent
ShoreTel with a cloud delivery option for the increasing base of customers requesting UCaaS. The
former M5 unit is now branded as ShoreTel Sky. Key benefits that the ShoreTel parent company
bring to ShoreTel Sky are a stronger brand, a larger sales force (particularly on the West Coast in
the U.S.), and a richer set of UC features that can be ported (that is, ShoreTel CPE functionality can
potentially be enabled on ShoreTel Sky). UCaaS is now delivered out of three U.S. data centers. A
fourth data center in London is scheduled to be on board in the first quarter of 2013.
ShoreTel Sky is one of the more experienced UCaaS suppliers with 12 years of operations. Starting
with a cloud VoIP and contact center foundation, ShoreTel Sky now has IM, presence, UM, mobility
and videoconferencing. Through the past year, ShoreTel Sky has been securing a larger account
base. Gartner estimates that ShoreTel Sky now supports approximately 10 accounts with more than
1,000 employees and supports some in the 5,000-employee range.
Consider ShoreTel Sky if you are a small to midsize enterprise of up to 5,000 employees seeking a
combined cloud UC and contact center capability.
Strengths
■ Users are attracted to ShoreTel Sky's complementary contact center capability. Areas of
contact center strength are analytics, automated call flow implementation, and support for
customer service and sales agents.

■ The ShoreTel integration is proceeding well. ShoreTel Sky has already integrated the ShoreTel
Mobility offering (previously Agito).
■ ShoreTel Sky is one of the larger and more experienced North American UCaaS providers. The
company has invested heavily in network tools for automating the provisioning process and
supporting a high-quality network.
■ The company has a tradition of strong customer service.
Cautions
■ The current video capability is only single-party (that is, between two people), with Video
Graphics Array (VGA) quality.
■ ShoreTel Sky lacks a Web-conferencing capability. Gartner expects that ShoreTel Sky will
secure the Web-conferencing functionality from the parent company's CPE platform in the first
half of 2013.
■ ShoreTel Sky's offering has traditionally been priced at a premium as the company focuses on
high-end customer service.
■ ShoreTel Sky's offering and ShoreTel's CPE offering are two separate platforms. Users
therefore have to evaluate the features and functionality of each platform separately.
Thinking Phone Networks
Thinking Phone Networks is a Massachusetts-based, privately held UCaaS provider. It uses a
proprietary platform that includes open-standards-based Web APIs to facilitate UC application
integration. UCaaS is branded as ThinkingSuite, which is offered across North America. There is
now a U.K.-based data center supporting European sites of North American accounts. The majority
of customers have been secured through an internal sales force. In the past 18 months, Thinking
Phone expanded its base of channel partners, including CSPs, VARs and master agents. Channels
will be used to reach Europe-based companies starting in 2013.
Thinking Phone has a VoIP and contact center legacy. Customers are supported over carrier-class
networks as opposed to broadband. The company has invested significant resources in tools to
facilitate customer provisioning, network performance management, customer MACs and other
back-office capabilities. This has resulted in a solid customer service and support track record.
Thinking Phone has historically focused on midsize accounts. In the past year, it has started to
support a few clients of above 5,000 endpoints (Gartner estimates six to eight clients above 5,000
endpoints).
Consider Thinking Phone Networks for midsize deployments seeking a broad portfolio of UC
services based on a proprietary platform.

Strengths
■ The Thinking Phone UCaaS offering is strong in mobility (with PBX feature set and IM/presence
extended to smartphones/tablets) and videoconferencing (six-way desktop videoconferencing).
■ The integrated analytics capability leverages business data in such areas as workforce
scheduling, agent productivity tracking, best-practice identification and related business
processes.
■ Thinking Phone provides a strong combined cloud VoIP and cloud contact center value
proposition.
■ Web-based APIs enable integration with multiple CRM systems — for example, salesforce.com,
Microsoft Dynamics CRM, SugarCRM and SAP CRM.
■ During each of the past three years, Thinking Phone has increasingly shown the ability to
support larger accounts (Gartner estimates six to eight clients of above 5,000 endpoints).
Cautions
■ Thinking Phone has limited brand recognition, despite its ability to support midsize enterprise
accounts. Some potential prospects prefer branded solutions from the better-known vendors
(for example, Cisco and Microsoft).
■ Thinking Phone Networks' channel partners have yet to make a noticeable impact in expanding
market awareness. A number of partners are also supporting other cloud UC options.
■ The UCaaS offering does not currently offer an internally supported Web-conferencing
capability (but is expected to in the first quarter of 2013). Currently, Thinking Phone UCaaS
integrates with third-party tools — Citrix GoToMeeting, Cisco WebEx and IBM Sametime.
Verizon
Verizon is a global CSP headquartered in New Jersey. Its lead UCaaS offering is with the Cisco
HCS platform for midsize to large accounts. There is also a cloud VoIP offering (using the BroadSoft
platform) targeted to SMBs. This Magic Quadrant analysis concentrates on Verizon's Cisco HCS
offering because of its enterprise focus.
Verizon initially struggled to get the Cisco HCS offering to a market-ready status, in part due to the
challenges in operationalizing and automating the back-office toolsets (both Cisco's and Verizon's).
From a "glass half-full perspective," these challenges appear to be resolved because the Cisco
HCS offering is both generally available in North America and possesses active accounts with an
expanding pipeline. Gartner expects Verizon to introduce the HCS offering to Europe in 2013.
The BroadSoft platform, now branded as Virtual Communicator Express (VCE), focuses on VoIP
services for the SMB market. VCE also includes a limited base of UC functionality in the areas of
mobility, IM/presence and third-party integration with Google UC applications.

Enterprises seeking a branded Cisco cloud UC offering with strong mobility capabilities should
consider Verizon UCaaS.
Strengths
■ The Verizon Cisco HCS UCaaS offering is now generally available, with more than 10,000
enterprise customer endpoints (across multiple accounts) activated and deployed.
■ Verizon possesses a strong base of complementary skills and assets that have the potential to
make Verizon a formidable UCaaS supplier — global footprint, wireless solutions, IP/Ethernet
networks, Terremark data centers, security and financial strength.
■ Verizon has a strong product road map, particularly in the areas of global delivery and wireline/
wireless integration.
■ The company has more than eight years of cloud VoIP/UC experience, which can be leveraged
with the newer Cisco, and existing BroadSoft, UCaaS solutions.
Cautions
■ Verizon continues to have a methodical product development process prone to scheduling
delays. Early UCaaS indicators reveal that competing system integrators and application
specialists are faster at introducing new services.
■ Gartner remains skeptical as to whether Verizon can effectively support multiple parallel cloud
UC offerings based on Cisco and BroadSoft.
■ Customers report complexity in getting various Verizon support groups — for example, sales,
project management, field installation and customer service — across the delivery chain to
operate synchronously. This is particularly true for midsize accounts.
■ The company has experienced a fair amount of management and workforce turnover as Verizon
leadership seeks to transform the company from a legacy network provider to an IT solution
provider.
West
West is based in Omaha, Nebraska, and it now offers three distinct UCaaS solutions across a single
delivery platform. The first is the Smoothstone solution (West acquired Smoothstone in the second
quarter of 2011 for $120 million), branded as VoiceMaxx. This is the most mature solution, with
roughly a decade of experience supporting cloud UC customers. Gartner believes that West is one
of the top North American suppliers of cloud UC endpoints in terms of market share (Gartner's
estimate is 150,000 or more total endpoints). In the past year, West has recently integrated its
InterCall conferencing functionality to its platform.
The second solution is based on Cisco HCS, branded as VoiceMaxx CE, and has been generally
available since the fourth quarter of 2011. West now has a few thousand endpoints operating with
VoiceMaxx CE, and it is aggressively looking to build the sales funnel. The third solution is based on

Microsoft Lync, which will be generally available in late fourth quarter of 2012. All three UCaaS
solutions share a common delivery platform, architecture and set of data centers. This Magic
Quadrant rating will focus on the first two (as the Microsoft Lync offering was too late for inclusion in
this research).
The company prefers to supply its customers with a bundled data network (many accounts rely on
West for its IP/MPLS and Ethernet services), complemented with Cisco routers and handsets to
deliver greater control and better performance. West has traditionally focused on clients above 250
employees and has been a UCaaS pioneer relative to supporting larger UCaaS deployments of
more than 1,000 employees, with some (Gartner estimate of five clients) now exceeding 5,000
employees.
In addition to its UCaaS solutions, West offers a collection of communications solutions for
automated alerts/notifications, emergency communications solutions, contact center/interactive
voice response (IVR) services, social media interaction and mobile solutions. These solutions have
largely been run as parallel businesses and are not part of this evaluation.
Consider West as an experienced supplier, especially for midsize to larger UCaaS deployments,
including those that may require integrated contact center functionality.
Strengths
■ The VoiceMaxx (Smoothstone) offering is a mature and stable cloud UC solution. Starting with
VoIP and contact center as the foundation, it now supports IM/presence (the AMP client), Web
conferencing (via West InterCall), UM and mobility.
■ Midsize accounts value the combined cloud UC with contact center functionality, which also
includes IVR, analytics and workforce optimization.
■ West UCaaS customers report satisfaction with customer service. A single support
representative can often address Levels 1 through 3 support issues.
■ West has proved to be an agile UCaaS supplier to date. It is able to bring new products to
market faster than many of its competitors.
Cautions
■ It is difficult to understand the full portfolio of West solutions (spanning conferencing, UCaaS,
emergency communications, among others). To date, the portfolios have largely been run
independently, with limited product integration.
■ Gartner is concerned about West's ability to support, maintain and evolve three parallel UCaaS
solutions: Smoothstone, Cisco HCS and Microsoft Lync.
■ The West (from the Smoothstone acquisition) mobility capability (Mobile Connect) is serviceable
but is not leading-edge. For example, it presently does not offer tablet support or provide a rich
PBX feature set (West does support Cisco and Microsoft clients to meet the more-advanced
needs).

■ West has a reputation for slightly higher pricing than market averages as it focuses on strong
technical support and a robust underlying network.
Vendors Added or Dropped
We review and adjust our inclusion criteria for Magic Quadrants and MarketScopes as markets
change. As a result of these adjustments, the mix of vendors in any Magic Quadrant or
MarketScope may change over time. A vendor appearing in a Magic Quadrant or MarketScope one
year and not the next does not necessarily indicate that we have changed our opinion of that
vendor. This may be a reflection of a change in the market and, therefore, changed evaluation
criteria, or a change of focus by a vendor.
Added
Azaleos, CSC, Mitel and 8x8 were added. ShoreTel has replaced M5 Networks (which ShoreTel
acquired in the first quarter of 2012).
Dropped
BT, Cisco, Cypress Communications and Siemens Enterprise Communications were dropped.
BT was not included because the North American focus of this research does not reflect BT's
UCaaS strengths in its core European market and other global regions.
Cisco was removed because its main go-to-market strategy is to deliver a partner-led cloud UC
technology platform.
Cypress was removed because its new parent company, Broadvox, has changed its business
focus.
Siemens Enterprise Communications was removed because its cloud UC focus for the North
American enterprise market is on private UC cloud infrastructure.
Inclusion and Exclusion Criteria
For inclusion in this Magic Quadrant, solution providers must support the following capabilities:
■ The UCaaS delivery model. Typical characteristics include a multitenant or virtualized UC
infrastructure that is owned, maintained and hosted by the provider. Users then purchase a
service (often paid via the SaaS model) based on a per-user, per-month fee.
■ A UCaaS offering with significant market presence that includes VoIP, with integrated
conferencing (audio, video and Web), IM/presence, and messaging.
■ The UC functions must be well-integrated; specifically, VoIP-centric solutions will not be
considered.

■ Email may be provided separately, but UM is a core service.
■ A significant market presence in North America. This can be demonstrated in one or more of the
following ways:
■ UCaaS annual revenue exceeding $25 million.
■ Differentiating service innovation and mind share with North American enterprises (3,000
employees and above).
■ Proven ability to support enterprise accounts nationally.
■ Sufficient sales, revenue and operational presence to support market objectives.
■ Services over a large segment of North American geographic regions (suppliers limited to
pockets of North American regions will not be included).
■ The ability to supply a complete UCaaS portfolio, even if the parts are offered via partnerships.
■ Demonstrable UCaaS portfolio with references.
■ References should use a broad set of UC capabilities.
■ The ability to generate significant interest by leading client market segments.
Note that UCaaS resellers that do not offer significant value-added capabilities/services (beyond the
UCaaS offering that they represent) are not considered for this Magic Quadrant analysis.
Evaluation Criteria
Ability to Execute
Gartner analysts evaluate UCaaS providers based on the breadth, quality and overall maturity of
their applications, processes, tools and procedures that enhance individual, group and enterprise
communications. Ultimately, UCaaS providers are judged on their ability and success in capitalizing
on their vision (see Table 1).

Table 1. Ability to Execute Evaluation Criteria
Evaluation Criteria Weighting
Product/Service High
Overall Viability (Business Unit, Financial, Strategy, Organization) High
Sales Execution/Pricing Standard
Market Responsiveness and Track Record Standard
Marketing Execution Standard
Customer Experience Standard
Operations Standard
Completeness of Vision
Gartner analysts evaluate UCaaS providers based on their ability to convincingly articulate logical
statements on current and future market directions, innovations, customer needs and competitive
forces and how well these map to Gartner's overall understanding of the marketplace. Ultimately,
UCaaS providers are rated on their understanding of how market forces can be exploited to create
opportunities for providers and their clients (see Table 2).

Table 2. Completeness of Vision Evaluation Criteria
Evaluation Criteria Weighting
Market Understanding High
Marketing Strategy Standard
Sales Strategy Standard
Offering (Product) Strategy High
Business Model Standard
Vertical/Industry Strategy Standard
Innovation Standard
Geographic Strategy Standard
Quadrant Descriptions
Leaders
Vendors in the Leaders quadrant have been delivering complete UCaaS solutions for more than a
year, have clients with more than 1,000 subscribers and have more than 100,000 total endpoints in
service. These vendors offer comprehensive and integrated UCaaS solutions that directly, or with
well-defined partnerships, address the full range of market needs, including the ability to service
large accounts. These vendors have defined migration and evolution plans for their products in core
UCaaS areas and are using their solution sets to acquire new clients, as well as to expand their
footprints in their client bases to new functional areas.
Challengers
Vendors in the Challengers quadrant have the potential to deliver to large national enterprises, and
are poised to move into the Leaders quadrant but have not yet done so. They have yet to bridge
this gap because their UCaaS solution is missing selected elements, they are unable to provide
references on the full suite, or they are still evolving their customer support.
Visionaries
Vendors in the Visionaries quadrant are close to, or are already, delivering differentiating UC
functionality or services but have not yet established themselves in the market (for example, support
accounts above 1,000 endpoints). For instance, a vendor may have added useful social or
collaboration functionality to its portfolio, or a vendor may have unique mobile UC capabilities, or a

vendor may differentiate with video or with exceptional customer service. All of these may make a
provider visionary.
Niche Players
Vendors may be in the Niche Players quadrant for different reasons. Some may have major
elements of their portfolio not unified or may lack important functionality in their solution. Others
may be in the Niche Players quadrant because they are an on-premises UC vendor that is largely
unproven in the UCaaS market. Finally, some vendors are in the Niche Players quadrant because,
despite their full UC solution, they do not have the brand recognition or marketing ability to sell
nationally (that is, beyond their core territory).
Context
The North American UCaaS market has evolved significantly through 2012 in three core areas: the
emergence of branded CPE platforms now supporting UCaaS; the maturity of selected UCaaS
platforms; and limited adoption by the Fortune 1000 community. First, Cisco is the lead branded
CPE vendor supporting UCaaS through some 20 active channel partners (many of which are
evaluated in this Magic Quadrant). Microsoft now offers UCaaS directly via Office 365, while also
supporting a cloud-enabled version of Lync for channel partners (this model shares multiple
similarities with that of Cisco HCS).
First, all prominent CPE UC vendors now support UCaaS in some shape or fashion — Alcatel-
Lucent, Avaya, Interactive Intelligence, Mitel, NEC, Siemens Enterprise Communications, ShoreTel
and Toshiba, to name a few. These traditional CPE vendors believe it is essential to support both
premises and cloud UC to maintain market relevancy. In parallel, larger customers tend to reveal a
preference for UCaaS delivery via the major CPE vendors, particularly Cisco and Microsoft.
Second, a number of UCaaS suppliers are now in their third or fourth product release. This is
particularly true of the application specialists that operate with homegrown infrastructure. The 2012
generation of video, mobility and contact center functions are more capable and integrated. Users
report that portals have also improved in the past year in terms of ease of use, reporting capabilities
and management controls. User adoption of richer UCaaS functions has picked up from 2011,
when a higher proportion of users focused mainly on VoIP. Gartner estimates that more than 75%
of UCaaS accounts now implement UC functionality beyond VoIP. A number of UCaaS offerings
now support multiparty high-definition video, a notable improvement from 2011's single-party VGA
quality video. Mobile users can increasingly secure PBX feature set functionality integrated with
their smartphones, while in 2011, they settled for single-number reach and simultaneous ringing.
Third, Fortune 1000 companies are cautiously adopting UCaaS via staged rollouts. In many cases,
these rollouts are limited to a specific business unit, functional group or geographic location.
Gartner expects that broader, global rollouts will occur after these initial forays have proven
successful. Larger Fortune 1000 organizations require such proof points before making
corporatewide technology commitments. In addition, they generally prefer working with branded
vendor solutions from larger delivery partners.

UCaaS still has two barriers to overcome. First, it has few proven success stories for large
enterprises. The back-office provisioning tools for onboarding 10,000 or more endpoints are still
maturing and not fully proved. Second, many of the accounts of more than 1,000 employees that
have opted for UCaaS are initially only deploying cloud VoIP (as opposed to the broader array of UC
functions). Today's deployments are primarily regional, spanning a single country or geographically
neighboring countries. There are few panregional implementations (for example, supporting a
multinational corporation's operations in North America, Europe and Asia/Pacific).
Although this is the fourth year of Gartner's North American UCaaS Magic Quadrant, this is the first
year in which any participants have achieved a position in the Leaders quadrant. These participants
bring to market a broad mix of UC functions while demonstrating the capacity to support enterprise
accounts exceeding 1,000 endpoints (sometimes into the 5,000-employee range). User feedback
reveals positive experiences with mobility functions that provide PBX functionality to smartphones
(primarily iOS and Android). A small but growing segment (estimated at 5% for new North American
UCaaS deployments) of users no longer even use hard phones, instead relying solely on mobile
devices and softphones.
Gartner's expectations for UCaaS in 2013 are twofold. First, UCaaS will start supporting global
deployments spanning multiple regions. Many of the UCaaS participants in this Magic Quadrant
already have infrastructure in North America, Europe and Asia/Pacific as a first step. Second,
today's Fortune 1000 UCaaS users will adopt the service across broad swaths of the organization.
However, for either of these events to transpire, UCaaS suppliers must demonstrate effective back-
office toolsets that offer automated support of large installations.
Market Overview
UC offers businesses the ability to enhance how individuals, groups and companies interact,
perform and, if applied wisely, improve profitability. The majority of UC deployments continue to be
via premises-based solutions. IT culture and real or perceived infrastructure control requirements
both favor premises-based deployments. However, cloud UC (known as UCaaS) continues to gain
customer mind share as the technology matures. Gartner has experienced a significant uptake in
UCaaS inquiries, with some clients starting out with the premise of "Why not the cloud?"
With UCaaS, the provider owns, manages and hosts the UC infrastructure in its facilities. The
infrastructure is typically multitenant or virtualized to allow customers to share hardware resources
(and thereby reduce system cost structure). Users pay subscription fees for UC services (typically
monthly) rather than making capital investments for dedicated infrastructure. Another UCaaS benefit
is that the user does not incur the technology risk of purchasing infrastructure from a vendor that
later exits the market (for example, Nortel).
The majority of UCaaS deployments to date have focused on a single platform vendor (with email
being the exception). UCaaS suppliers have yet to demonstrate strong interest in cross-vendor
interoperability. Higher licensing costs also hurt the business case for multivendor UCaaS.
UCaaS implementations typically leverage existing Microsoft Exchange (premises-based or Online)
and, to a lesser extent, Google, for email. These two companies' dominant email position and

associated low costs make it unprofitable for other UCaaS vendors to offer their own solutions.
Both Microsoft and Google provide open interfaces to enable efficient UCaaS UM.
Key Participants
The UCaaS participants in this 2012 Magic Quadrant emanate from four primary sources:
■ Application specialists
■ CPSs
■ Technology vendors
■ System integrators
Application specialists are typically private or small public companies that focus on UCaaS
delivery. 8x8, PanTerra Networks, Thinking Phone Networks and West (formerly Smoothstone) are
the Magic Quadrant participants grouped into this category. They have been the pioneers of UCaaS
and continue to lead the market through 2012. They typically started from a cloud VoIP business
model, migrating to UCaaS application specialists focusing on strong customer service.
Through 2012, the application specialists have been expanding to larger accounts, in some cases
up to 5,000 employees (see Note 1). They have also experienced moderate success in getting their
account base to deploy a richer UC feature set (a combination of VoIP, UM, IM/presence,
audioconferencing and mobility). Integrated contact center functionality has also proved to be a
compelling feature (for example, a 1,500 user UC deployment that also supports 75 contact center
agents).
Many application specialists operate with an internally developed UC infrastructure. They then
integrate with corporate IT tools, such as Outlook (Microsoft Calendar), Internet Explorer (Microsoft
Web browser), iPhone (Apple smartphone) and Androids (Google smartphones). To date, the use of
proprietary UCaaS platforms has not been a major inhibitor to adoption in the SMB sector. The
application specialists have a reputation for strong customer service and support, which is viewed
as a competitive differentiator against the larger players entering the market.
CSPs are the large, legacy telephone carriers that now seek an expanded IT and cloud delivery role.
AT&T and Verizon are the Magic Quadrant participants grouped into this category. In addition,
Sprint entered the market in mid-2012 with a wireless-focused UCaaS offering leveraging Cisco
HCS infrastructure (although this offering was too new to qualify for review in this Magic Quadrant).
The CSPs bring a foundational base of carrier-grade network services, data centers and wireless
assets, and through 2012, this group has remained committed to the UCaaS market. They typically
leverage third-party vendor platforms, led by BroadSoft, Cisco and potentially Microsoft.
The CSPs' financial clout, strong brand and experience in real-time communications make them
logical candidates for UCaaS market leadership. Through 2012, the CSPs have been signing
contracts with midsize and larger enterprise accounts. The midsize accounts are starting to get
activated. The larger enterprise accounts are often in the early stages of a multiyear integration.

Technology vendors are selected, well-branded technology vendors that are also service
providers. Google, Microsoft and ShoreTel (via the M5 acquisition) have migrated their premises-
based platforms to support direct cloud delivery (note that Cisco's cloud platform is designed to be
delivered through channel partners, not directly served by Cisco).
Microsoft leads with its Office 365 offering, which consists of a broad suite of Microsoft business IT
services, of which UCaaS is one. The Office 365 delivery model allows users to purchase cloud
UCaaS either directly from Microsoft or through channels. Most UCaaS participants view Microsoft
as both a potential partner and a potential threat. The threat perspective became more prominent
following Microsoft's fourth quarter of 2011 acquisition of over-the-top provider Skype.
System integrators are the most recent addition to the UCaaS market. They have traditionally
provided managed UC services and are now entering the UCaaS space. CSC is the lone system
integrator in this UCaaS analysis, but Gartner expects more active UCaaS participation from such
system integrators as HP, Dimension Data, IBM, Presidio and Xerox in 2013 and beyond. System
integrators focus on larger accounts serviced over carrier-grade networks.
Pricing
Market pricing for UCaaS varies widely. Key factors influencing price include deployment size,
contract duration, the specific UCaaS supplier, features subscribed to, and any additional
customized services included. Many UCaaS suppliers bundle a WAN service (such as IP MPLS)
with UCaaS to ensure better network performance. Pricing for a rich UCaaS offering (that is, all
features subscribed to) typically ranges from $30 to $45 per user per month. Simpler VoIP-centric
solutions range from $13 to $22 per user per month. Gartner expects annual price erosion as the
market matures, more vendors enter the market, service delivery becomes more efficient, and users
gain market savvy.
Hybrid Deployment
Many enterprises with more than 1,000 employees, particularly those above 5,000 employees,
prefer hybrid implementations. The hybrid model calls for some UC functions to be supported in the
cloud, with others on-premises. The main factor driving hybrid implementations is the need to fully
depreciate on-premises assets, such as an IP PBX purchased two years ago. Other reasons that
businesses require a hybrid architecture include the preference to maintain certain functionality on-
site (for example, email and concern about reliability of selected UC function(s)).
A hybrid deployment (see Note 2) is typically based on either a functional or geographical
segmentation. A functional segmentation example is a deployment in which messaging and VoIP
are delivered via the cloud, while IM/presence and conferencing are delivered on-site. In contrast, a
geographical segmentation example is where the headquarters location is served by an on-
premises IP PBX, with regional locations supported by cloud VoIP.
UCaaS suppliers indicate that enterprise requirements for hybrid deployments can result in
elongated and expensive integrations. A significant amount of planning is required between the
enterprise and UCaaS supplier to define the hybrid architecture (that is, getting the old to work with
the new). The UCaaS supplier must then implement this customized hybrid environment via manual

processes that result in significant professional services costs. Re-creating corporate dial plans in
hybrid architectures have shown to be particularly difficult.
The complexity of tackling hybrid requirements is one reason why larger enterprises (above 5,000
employees) have been slow to adopt UCaaS. The ensuing professional services costs can destroy
the UCaaS business case. We expect this hurdle to gradually be reduced (although not fully solved)
a little bit each year during the next five years, as legacy infrastructure becomes more outdated, the
user community becomes more comfortable with alternative UCaaS technology, and UCaaS
providers secure automated tools to support hybrid environments.
Recommended Reading
Some documents may not be available as part of your current Gartner subscription.
"Magic Quadrants and MarketScopes: How Gartner Evaluates Vendors Within a Market"
"Best Practice: Pricing for Unified Communications as a Service and for Outsourced UC"
"Magic Quadrant for Unified Communications"
"Cisco's Cloud UCC Offering"
"SWOT: Microsoft, Unified Communications as a Service, Worldwide"
"What You Need to Know to Succeed in the UCC Market"
"A Technology Framework for Enterprise Unified Communications"
"Toolkit: How to Develop an Effective Unified Communications and Collaboration Road Map"
"UC 'in the Cloud' and On-Premises: Examples of Hybrid Solutions"
"What You Need to Know to Succeed in the UCC Market"
Note 1 Deployment Size
Cloud UC deployments supporting more than 5,000 employees remain more the exception than the
rule. Larger deployments above 5,000 tend to focus on a limited set of UC services. We expect
larger, richer UCaaS deployments through 2013.
Note 2 Hybrid Deployment
This Magic Quadrant analysis considers hybrid implementations as long as the majority of
functionality is delivered via the cloud. However, vendors leading with hybrid implementations have
their ratings reduced for not being fully cloud-enabled. Cisco, Google and Microsoft are all branded
vendors capable of supporting large installations where hybrid is their lead delivery model. Google

and Microsoft are full cloud solutions, but the resulting voice service is inadequate for most
business environments.
Evaluation Criteria Definitions
Ability to Execute
Product/Service: Core goods and services offered by the vendor that compete in/
serve the defined market. This includes current product/service capabilities, quality,
feature sets and skills, whether offered natively or through OEM agreements/
partnerships as defined in the market definition and detailed in the subcriteria.
Overall Viability (Business Unit, Financial, Strategy, Organization): Viability includes
an assessment of the overall organization's financial health, the financial and practical
success of the business unit, and the likelihood that the individual business unit will
continue investing in the product, will continue offering the product and will advance
the state of the art within the organization's portfolio of products.
Sales Execution/Pricing: The vendor's capabilities in all pre-sales activities and the
structure that supports them. This includes deal management, pricing and negotiation,
pre-sales support and the overall effectiveness of the sales channel.
Market Responsiveness and Track Record: Ability to respond, change direction, be
flexible and achieve competitive success as opportunities develop, competitors act,
customer needs evolve and market dynamics change. This criterion also considers the
vendor's history of responsiveness.
Marketing Execution: The clarity, quality, creativity and efficacy of programs designed
to deliver the organization's message to influence the market, promote the brand and
business, increase awareness of the products, and establish a positive identification
with the product/brand and organization in the minds of buyers. This "mind share" can
be driven by a combination of publicity, promotional initiatives, thought leadership,
word-of-mouth and sales activities.
Customer Experience: Relationships, products and services/programs that enable
clients to be successful with the products evaluated. Specifically, this includes the ways
customers receive technical support or account support. This can also include ancillary
tools, customer support programs (and the quality thereof), availability of user groups,
service-level agreements and so on.
Operations: The ability of the organization to meet its goals and commitments. Factors
include the quality of the organizational structure, including skills, experiences,
programs, systems and other vehicles that enable the organization to operate
effectively and efficiently on an ongoing basis.

Completeness of Vision
Market Understanding: Ability of the vendor to understand buyers' wants and needs
and to translate those into products and services. Vendors that show the highest
degree of vision listen to and understand buyers' wants and needs, and can shape or
enhance those with their added vision.
Marketing Strategy: A clear, differentiated set of messages consistently
communicated throughout the organization and externalized through the website,
advertising, customer programs and positioning statements.
Sales Strategy: The strategy for selling products that uses the appropriate network of
direct and indirect sales, marketing, service and communication affiliates that extend
the scope and depth of market reach, skills, expertise, technologies, services and the
customer base.
Offering (Product) Strategy: The vendor's approach to product development and
delivery that emphasizes differentiation, functionality, methodology and feature sets as
they map to current and future requirements.
Business Model: The soundness and logic of the vendor's underlying business
proposition.
Vertical/Industry Strategy: The vendor's strategy to direct resources, skills and
offerings to meet the specific needs of individual market segments, including vertical
markets.
Innovation: Direct, related, complementary and synergistic layouts of resources,
expertise or capital for investment, consolidation, defensive or pre-emptive purposes.
Geographic Strategy: The vendor's strategy to direct resources, skills and offerings to
meet the specific needs of geographies outside the "home" or native geography, either
directly or through partners, channels and subsidiaries as appropriate for that
geography and market.

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