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The hosted IP telephony and UCaaS installed user base will expand at a compound annual growth rate (CAGR) of 18.2% during the years 2018-2025, as net new annual users increase from 5.10 million in 2018 to 8.74 million in 2025. Macro-economic factors or disruptive innovation could slow or accelerate market growth.Cloud will become the preferred technology consumption model within the next decade, however premises-based systems will co-exist for decades to come. Businesses will require a variety of cloud deployment options--private, public, hybrid (cloud and premises—based or different cloud architectures, multi-tenant, multi-instance, etc.)—to choose from based on their specific requirements.The US economy is expected to maintain robust growth rates, as follows: 2.1% in 2019, 2.0% in 2020 and 1.8% in 2021. The US unemployment rate is likely to remain around 3.6% in 2019 and increase slightly to 3.7% in 2020 and 3.8% in 2021. Economic growth will have a positive impact on employment growth rates as well as technology investments. Canadian GDP is likely to grow at about 1.5% in both 2019 and 2020. The unemployment rate in Canada is likely to rise from about 6.1% in 2019 to 6.4% in 2020. Overall, the economic climate in Canada will remain favorable for continued technology investments. Adoption of IP-based communications and cloud services will increase significantly in North America in the coming years, as businesses increasingly acknowledge the cost-saving and productivity benefits of converged networks and innovative IP-based applications. North American businesses are expected to become increasingly distributed due to a growing number of remote and mobile workers, as well as expanding customer bases, reseller channels and supply chains across multiple countries and regions. This trend will drive demand for flexible technology consumption models, mobility, and advanced collaboration tools. The workforce is also expected to become more demographically diverse with up to five generations of workers in some organizations. By 2025, the Millennials will comprise 75% of the workers globally, while Generation Z will also account for a smaller piece of the pie. This will necessitate technology upgrades to better support different work styles and communications tools preferences. Technology developers and UCaaS providers are expected to continue to innovate at a rapid pace and deliver new features and services, as well as leverage new business models to raise UCaaS appeal among a larger customer audience and drive adoption. Agile development, cloud architectures, containerization, mobile-first and video-first solutions will represent key enablers of accelerated innovation and more cost-effective provider operations. UCaaS providers will pursue untapped opportunities among new customer segments, including SOHOs and micro-businesses, front-line workers, mid-market and large enterprises. International providers will enter the North American market and North American providers will seek to expand internationally, creating new levels of competition. Author: Elka Popova
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