Cloud Telephony Services Market Size, Share & Growth [2031]

Report Description

The global cloud telephony services market size was USD 19.2 Billion in 2022 and is likely to reach USD 52.5 Billion by 2031, expanding at a CAGR of 11% during 2023 – 2031. The market growth is attributed to the surging adoption and demand for cloud telephony services for marketing, sales, communication, conferencing, and other applications.

Cloud telephony is referred to as cloud calling, a type of unified communications as a service that offers voice communication services through a third-party host. It provides on-demand services that enable an organization to run the business through a phone system enabling voice and data communication.

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Many business enterprises used cloud services to operate their business through phone systems instead of conventional call methods. The users do not require a physical connection with those network providers as it hosts multiple functions in a virtual model such as video calling and conferencing, voicemail, sending text messages, fax, and call recording.

Cloud services are considered to be the most convenient tools as it helps companies to operate functioning effectively. It also offers other advantages such as high flexibility, increase storage capacity, availability of services 24/7, and others.

The emergence of the COVID-19 pandemic has imposed several restrictions and stringent regulations that resulted in disrupting and rearranging the supply chain of almost all industries globally. Cloud based telephony solutions, on the contrary, have gained significant popularity with the increasing usage and demand for several purposes, during the COVID-19 crisis. For instance, many manufacturing companies increasingly adopted cloud telephony services to improve work-from-home and remote working procedures.

Rising adoption of cloud telephony solutions in large and small & medium enterprises is due to rapid digitalization of almost all their operations and services. Furthermore, it offers advantages such as they require a low amount of maintenance and less investment. Thus, the pandemic creates growth opportunities for the cloud telephony services market.

Cloud Telephony Services Market Dynamics

Key Trends

Surging integration of advanced features such as ML, IoT, and AI with the cloud based digital solution is currently trending in the cloud based telephony solutions market. Integration of these advanced technologies is penetrating corporate services as it provides feasible communication among the end-users. Cloud telephony solutions aids companies in improving service operations by providing flexibility and enhancing data storage.

Major Drivers

Rising adoption of cloud telephony services among Small and medium-sized enterprises (SMEs) to disseminate information about their products. The deployment of this digital solution is favored by the advanced IP telephony services that offer better connectivity in an effective manner.

Telecom enterprises are increasingly adopting cloud based telephony solutions coupled with switching to IP network services over traditional networks. Cloud telephony services offer various benefits as compared to traditional networks including cost-effective and high-performance quality that aids in raising its intense demand across telecom services.

Additionally, it is frequently used as an alternative service against Integrated Services Digital Network (ISDN) and public switched telephone network (PSTN) which are important factors boosting the market. Furthermore, the market is further supported by the massive rise in smartphone users among the end consumers.

BFSI is increasingly employing this digital technology for several applications in the industry. Deploying cloud services lessens the operational and maintenance operational cost among the users. Cloud telephony solutions aid in storing data and applications safely and securely. It also plays an essential part in accelerating banking services efficiency. Cloud telephony is considered a reliable and flexible solution for accessing advanced software and telephony services from any location. Thus, telephony services increase usage and demand across BFSI enterprises leading to a boost the market.

Existing Restraints

The lack of availability of a skilled workforce and shortage of technical expertise in developing and underdeveloped markets is posing great challenges to the overall market growth for cloud telephony services. This lack of strong infrastructural facilities might lead to an increase in the number of cyber-attacks resulting in hampering the market growth rate.

Risk associated with the telephony services such as data loss over the internet and rising concerns over cyber-attacks related to privacy services creates strong challenges for the overall market growth. Additionally, the availability of alternative substitute communication systems limits the market potential of cloud telephony services.

Emerging Opportunities

Rising technological advancement is expected to create immense growth opportunities. Manufacturing companies in the cloud telephony services market are increasingly concentrating on developing and launching new products to facilitate well with the latest available technology. For instance, companies are now increasingly launching new products that come with multiple connectivity features including the Internet of things. This pushes these companies to focus on research and development activities thereby driving the market. Additionally, growing mergers and acquisitions and adopting strategic partnerships among the major players are creating opportunities in the market.

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Scope of Cloud Telephony Services Market Report

The report on the global cloud telephony services market includes an assessment of the market, trends, segments, and regional markets. Overview and dynamics have also been included in the report.
 

Cloud Telephony Services Market Segment Insights

Based on the organization size, the global cloud telephony services market is segmented into large enterprises and small & medium enterprises. The small and medium enterprises segment accounted for major market revenue and is likely to continue expanding during the forecast period. Business advocates are concentrating on acquiring advanced technological services coupled with rising operational requirements with an increasing number of micro and medium enterprises.

Cloud telephony services have improved better connectivity among enterprises. Thus, micro-level enterprises and other SMEs are increasingly adopting cloud services to upscale their smooth functioning. Adding a user to a cloud phone system is just a click away from using cloud telephone services. Therefore, the growing number of SMEs in parallel with the rising proliferation of cloud telephony services paved the way for segment growth.

On the basis of deployment type, the market is bifurcated into cloud and hosted telephony. The cloud segment shares high market potential and is expected to lead the market sales with a considerable CAGR of around 9.2% during the forecast period. Consumers’ high demand for cloud type is encouraged by its existing benefitting properties such as high reliability, convenience, easy implementation, and secured loop among others. The increasing need for effective connectivity further propels the market sales of this deploying solution in the market.

Based on the network type, the global cloud telephony services market is fragmented as public switched telephone networks (PSTNS) and voice-over-internet protocol (VoIP) service networks. The voice-over-internet protocol (VoIP) service network segment registers robust growth in the cloud telephony services market and is anticipated to expand with a CAGR of around 14.1% by 2031. VoIP service network offers several advantages such as, it provides a user-friendly interface that aids in better communication and they are also cost-effective network services.

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In terms of application, the market is segregated into conferencing, sales & marketing, multi-level IVR, and customer relationship management. The customer relationship management segment is likely to grow due to high emphasis on keeping contacts and calls data safe to communicate efficiently with the customers and to improve the quality and productivity of the employees.

On the basis of end-user, the market is fragmented into media & entertainment, telecom and IT, healthcare, BFSI, retail, government, education, and others. The telecom & IT segment remained dominant in the market and is further estimated to be fast-growing during the forecast period. It offers effective communication services among the users and improved voice audits. Additionally, business enterprises are increasingly using telephony network services for effective connectivity performance of mail, chat, voice, media, and social networking, a voice further strengthens the market growth.

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In terms of region, the global cloud telephony services market is classified as Asia Pacific, North America, Latin America, Europe, and the Middle East & Africa. North America held a market share of 36% in 2021. It is further projected to reach a high CAGR during the forecast period due to the high presence of large cloud services vendors and increase in advanced technological infrastructure in the region. Enterprises are enabled to run and deliver services to their consumers seamlessly with the availability of advanced IT solutions. The increasing collaboration among the major players to develop innovative products and services further enhance the growth in North America.

The market in Asia Pacific is expected to expand its market size by nearly 28% during the forecasted period. Rapid digitalization and increasing number of enterprises in the region are surging the adoption of cloud telephony services for effective operation, thereby minimizing operational costs, thereby boosting the market in Asia Pacific.

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Latest Development

• In February 2022, conversational engagement firm Gupshup announced its deal with Truecaller, a contact verification firm to introduce advanced business identity solutions for enterprises. This partnership aims to develop a secure voice communication ecosystem for brands to better engage with consumers and improve the overall calling experience across India.
• In March 2022, Dialpad in collaboration with MIA Distribution planned to make its TrueCaaS solution, throughout Australia. Dialpad also partnered with Google and hopes to list its UC-CC solution on the Google Cloud Marketplace.