Global cloud communications revenue to grow at 18.3% CAGR over 2022-2027, forecasts GlobalData
Cloud communications are expected to grow substantially over the next five years as businesses switch from legacy PBX solutions to cloud communications and opt for a pay-as-you-go model to optimize expenses and avoid upfront investments. Against this backdrop, the cloud communications market size is anticipated to grow at a compound annual growth rate of 18.3% from $78 billion in 2022 to $180.7 billion in 2027, forecasts GlobalData, a leading data and analytics company.
GlobalData’s latest report, “GlobalData Market Opportunity Forecasts to 2027: Cloud Communications,” reveals that the US was the largest market for cloud communications in 2022, with a share of 36.7% of the total revenue, followed by China with an 8.5% revenue share. Meanwhile, India and Singapore markets are expected to grow fastest, registering CAGRs of 28.4% and 28.1%, respectively, over the forecast period.
Tejal Hartalkar, Senior Technology Analyst at GlobalData, comments: “Cloud communications is expected to continue its growth significantly due to scalability and adaptability. The technology offers both enhanced user and customer experience. In addition, these platforms often include advanced analytics and reporting features that help businesses gain insights into their communication patterns. This data-driven approach allows enterprises to make informed decisions and improve communication strategies.”
According to GlobalData, the critical verticals for cloud communications are manufacturing, information technology (IT), retail, retail banking, and government, collectively accounting for 33.7% of the overall market in 2022. The growing implementation of work-from-anywhere (WFA) and bring-your-own-device (BYOD) will continue to drive the performance of cloud communications across all sectors. Cloud-based communication API solutions facilitate remarkable advancements in all industry verticals by enabling streamlined communication and enhanced operational efficiency.
Gary Barton, Research Director for Enterprise Technology and Services at GlobalData, explains: “Cloud communication platforms have become the default option for most organizations. COVID-19 boosted this trend but has continued thanks to cloud-focused digital transformation strategies by enterprises. The cloud model offers the flexibility most businesses require as work patterns evolve and workforces grow and shrink. The cloud model also offers a strong disaster recovery component. The addition of complimentary components such as API plug-ins and AI are increasing the ability of these solutions to offer business value and enhance customer engagement.”
Tejal continues: “AI is shaping how the businesses operate. Enterprises insistently use AI-integrated cloud communication platforms to empower their customer service and sales agents. AI-powered virtual assistants and chatbots can assist enterprises in automating primitive tasks so that the agents can focus on more critical jobs. Virtual assistants and chatbots have been around for some time, but in the coming years, developments in AI will make their voice exchanges sound more natural and engaging.”
Gary concludes: “Regulatory pressures are increasing in most markets regarding storing and transferring employee and customer data. Therefore, cloud communication vendors and solution providers are investing in security measures, encryption capabilities, and local hosting options. These features help companies to meet stringent data protection and privacy laws like GDPR and CCPA. This allows businesses to reduce their compliance risks, enabling them to focus on core operations while ensuring transparent data practices. These enhancements ensure the ongoing relevancy of the cloud-hosted collaboration model.”
