Which One Is Right For You: VoIP vs UCaaS

November 19th, 2019

Phone calls and emails have been the two main business communication methods for decades. But companies are increasingly using other technology, like video conferencing and instant messaging applications, to help serve their daily communications needs. 

Voice communication, using either traditional private branch exchange (PBX) telephones or VoIP technology, and business email aren’t going anywhere. But the use of other types of digital communication software is expanding. For enterprise companies using multiple types of communication software, consolidating all their communication technology under one platform may be the best move. But for smaller businesses only using one or two of these applications, transitioning to a unified communications as a service (UCaaS) platform may be overwhelming and too expensive for their organization. 

Is VoIP being swallowed by UCaaS?

The short answer to the question ‘is VoIP being swallowed by UCaaS’ is no. But the larger story does involve the integration of the two. VoIP technology, which allows users to make voice calls over the internet rather than using traditional PBX phone systems or cellular data, is part of the underlying technology supporting UCaaS platforms.

UCaaS platforms typically encompass four main capability areas:

  1. Voice/VoIP
  2. Meeting solutions (including audio and video conferencing)
  3. Team collaboration (e.g. document sharing, screen sharing)
  4. Instant messaging/chat and presence technology

While VoIP is one component of these larger unified communications platforms, most vendors that have comprehensive UCaaS platforms still offer their Voice/VoIP solution as a stand-alone product. This is because many companies have their communication technology organized in a decentralized fashion, and still use separate solutions for different communication needs. 

Data collected from our recent survey of VoIP users confirm this: along with their voice solution, 83% of survey respondents use a messaging application and 76% use video conferencing software. Yet only 13% of respondents said their business would be using a UCaaS Platform by 2020. 

Especially for SMBs that may not need all the capabilities of a UCaaS platform yet, it may be more affordable for them to have separate VoIP, online meetings, and messaging solutions. Only 8% of respondents from companies with 1-50 employees said their company would be adopting a UCaaS platform in 2020. For certain industries, it also doesn’t make sense to immediately scale up to the UCaaS platform if a sizable portion of end-users won’t be fully utilizing the platform.

However, centralizing communication software within one platform instead of having multiple separate online communication tools may be an attractive option for enterprises. 1 out of 3 survey respondents from companies with 10,000+ employees said they would be using a UCaaS platform by 2020.  

percentage of companies by business size that are switching to a UCaaS platform by 2020

The key takeaway is that the UCaaS landscape is still evolving. Even though enterprises are more likely to adopt a UCaaS platform than SMBs—organizations of all sizes are still figuring out if this is the right move for their company. 54% of survey respondents from all company sizes were not sure if their company would be making the switch to UCaaS in 2020.

Vendors in the market recognize that the level of centralization or decentralization of communication software can vary by company size or composition of the user-base. Many VoIP providers that offer a full-featured UCaaS platform have bundling options that allow businesses to select only the communication capabilities they need. This allows organizations to scale up their communication solution as needed.

Factors to consider when evaluating VoIP and UCaaS software 

More and more businesses of all sizes are using multiple types of communication software. Messaging and video conferencing/ web conferencing applications are most likely to be used in tandem with a Voice/VoIP solution. Of the 207 VoIP users we surveyed, only 1% did not use any other type of communication technology.

Types of communication software users have in addition to VoIP

Given there’s a good chance your business is already using two or more types of communication software, how do you know whether a stand-alone VoIP solution or UCaaS platform is the right fit for your organization?

Here are a few questions to ask before you start evaluating products that will help identify which type of software will suit your current needs best:

1. How many separate communication solutions is your business currently using?

If you’re using three or more individual communication products, it might be more cost-effective to centralize then within one platform. On the other hand, if you only use one or two different types of communication solutions at work, scaling up to a fully-featured UCaaS platform might be overkill—and over budget.

2. What size is your company, and will the majority of employees need access to various communication capabilities (e.g. voice, video and audio conferencing, and messaging)?

Stand-alone VoIP solutions are often a better choice for SMBs, at least when they’re first starting out with the software. Many VoIP providers also offer a free trial or free version of their software, which may be the perfect fit for self-employed workers or micro-businesses with 1-10 employees.

Larger companies that need a majority of employees to have access to these capabilities should keep in mind that individual VoIP or web conferencing solutions often have a maximum number of users. These companies may require more bandwidth in terms of the number of seats available than stand-alone products can offer.

3. Will users need to have access to information from other conversations that may take place over a web conference, voice call, or chat?

One benefit UCaaS brings is the ability for users to share and access information from other conversations. This can be especially useful for call centers, sales teams, or customer support/ service teams that need to track customer interactions. On the other hand, if your organization would primarily use a VoIP solution for internal communications, having access to this type of information may not be as necessary.

Looking for a voice solution that’s also connected to a UCaaS platform? Our Buyer’s Guide to VoIP Providers takes a look at 7 leading VoIP products and calls out which products are better suited for companies that may need to scale up to a fully featured unified communications platform in the near future.