Microsoft’s dominance in collaboration market and how rivals can fight it

Verizon recently announced that it has begun decommissioning its BlueJeans unified communications (UC) and conferencing platform while Hopin, once valued at over GBP7 billion, sold its digital events business for just GBP39 million.

The demand for UC has grown over the years, but the big winner has been Microsoft at the expense of its smaller competitors.

According to GlobalData, to counter Microsoft’s dominance in the collaboration market, rivals must fight back with artificial intelligence (AI) and communications platforms-as-a-service (CPaaS) use cases.

Gary Barton, research director for enterprise technology and services at GlobalData, commented: “The UC market has grown at double-digit percentage rates since the end of the pandemic and will continue to do so until at least 2026, highlighting the ongoing strength in the market despite a gradual return to the office. Despite this growth, Microsoft’s decision to ‘give’ Teams away with its wider suite of services such as 365 and Dynamics has given it a crucial market advantage that has seen even Cisco and Zoom begin to suffer.”

Moreover, the launch of the Microsoft 365 Copilot AI tool demonstrates the depth of its R&D resources. Despite the potential of Copilot, Microsoft has not taken the lead in predicting how AI will deliver benefits to businesses.

Barton elaborated: “Microsoft 365 Copilot is rightly positioned as an AI tool that will aid human workers in their day-to-day jobs, but its reseller partners have been disappointed that Microsoft has shown few potential ‘ready-made’ use cases beyond transcription services. There is an opportunity for UC vendor rivals with AI partners to create use cases that offer genuine productivity benefits.”

AI is not a technology that works in isolation and can be used in other fields, such as UC. It can be combined with other technologies such as CPaaS as well as employee- and customer-facing apps to enhance the user experience.

Barton concluded: “Combining AI and CPaaS and embedding that combination in collaboration tools and customer-facing apps creates a new way for employees to communicate internally and for businesses to engage with their customers. Vendors competing with Microsoft should look at how they can innovate in this space as this is where real commercial value can be unlocked.”

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