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The unified communications market continues to heat up, and the area that will likely see the most rapid growth in the coming years is hosted services. There are several key players in that space, including Fonality, Alteva, RingCentral, and many others. I recently had a chance to speak with the folks at 8x8 to get an update on the company and why they’re seeing such success in the market.
According to Joan Citelli, Director of Corporate Communications, 8x8 serves over 30,000 business customers and over 200,000 seats. In a year when many premise-based UC vendors are reporting declining revenues, 8x8 posted fiscal year first quarter revenues (June 2012) of $25.3 million, a 36% increase in revenue over the same period last year. During the quarter, 8x8 added 1,242 net new business customers. Not too shabby for a company that most people haven’t even heard of!
The vision driving 8x8’s business is “Empowering Conversations” through the cloud. This includes turning static, isolated communications into dynamic and productive conversations; harnessing the power of cloud technology to incorporate enhanced collaboration tools, workflow processes and data within the context of an interaction; and enabling users to initiate a variety of communication modes and related content from IM to voice to web and video conferencing.
When asked about the company’s competitive advantages, Citelli noted that 8x8 uses its own platform rather than a third party such as Broadsoft. By developing its own software, it’s easier to integrate and add new technologies, capabilities, and customizations, without having to wait for a third party to do this. It also eliminates the need to pay a licensing fee to the third party, which helps to keep costs down.While there are certainly benefits to using its own platform and software rather than a third party's, it also means that 8x8 needs to continually innovate and invest in R&D in order to provide new capabilities that customers require.
8x8 focuses on four pillars: cloud-based voice and UC, cloud video, cloud contact center, and information integration. The hosted offering provides a suite of 20 cloud-based services, including contact center, cloud-based security, Internet fax, virtual room video conferencing, and cloud back up.
Virtual Office is a cloud-based PBX with UC capabilities. Every Virtual Office extension user gets UC functionality, providing integrated VoIP, chat, presence, visual voicemail, call forwarding controls, a video softphone with dial in/out features, as well as mobile apps that act as extensions. Every extension gets UC functionality: visual voice mail, integrated VoIP, chat, presence, call forwarding rules, video softphone. Contacts can be imported from Outlook, Gmail, Facebook, or Twitter, enabling users to chat through those applications. Every user also gets access to the mobile app, which currently supports IOS and Android, and provides simultaneous ring, and displays the workers' office phone even when placing a call from the mobile app. iPad support was recently released, and video will be added to both IOS and Android devices shortly.
The next level up from Virtual Office, Virtual Office Pro, adds a Virtual Meeting service, including video conferencing, content sharing, chat, whiteboarding and annotation, as well as fax over IP. These capabilities are all integrated with the user's corporate directory, so users can drag and drop contacts from a corporate or personal directory to do a "click to conference."
Another enhanced capability is the Virtual Contact Center, based on 8x8's acquisition of Contactual in September 2011. The on-demand, multimedia contact center offering supports chat, skill-based and skill-level routing, call recording, real-time monitoring, historical reporting, and case management. 8x8 is one of the few hosted providers that offers this level of contact center capabilities – among similar types of hosted providers, Fonality is the only other vendor that offers full contact center services.
8x8 is predominantly US-based today, but is expanding to Canada at the end of the year, followed by the UK at the beginning of next year. While focused on SMBs, 8x8 is gaining more mid-market customers, with more customers that have regional offices or branch offices signing up for the service. Customers include companies with branch offices around the country, such as New York Life, Intel, Unison, McKesson, Sony, American Express, and many more. The company also has a Federal "Cloud First" Initiative to enable government agencies to move to the cloud.
8x8 is showing strong momentum, but needs to expand beyond the U.S., and compete with better-known companies such as Comcast and Verizon, as well as other cloud-based providers, and the premise-based vendors that have introduced hosted offerings. Fortunately, there's a huge untapped opportunity for cloud-based vendors, and there'll be enough business for the foreseeable future as SMBs as well as larger organizations transition to the cloud. I'm not as bullish as some of my colleagues when it comes to the cloud, and I expect to see a backlash as some companies recognize that hosted solutions cost more than premise-based solutions in the long run, and that it's harder to guarantee the quality for these services. That being said, the trend today is toward the cloud, and 8x8 is in a strong position in this growing market. 8x8 has shown good momentum and should continue to grow and expand as more companies move to the cloud.
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Communications Integrated to Optimize Business Processes.
UC integrates real-time and non-real time communications with business processes and requirements.
Uses presence capabilities for coordination, and presents a consistent unified user interface and experience across multiple devices and media types.
Learn more at What is Unified Communications all about?