The cloud telephony services market is expected to expand its roots at a steady CAGR of 9.7% during the forecast period. The market is likely to hold a revenue of USD 22.8 billion in 2023 while it is anticipated to cross a value of USD 57.6 billion by 2033.
Increasing adoption of cloud-based solutions and advanced technologies like AI, ML, and IoT integrating with corporate spaces making it feasible to communicate with the end-users and customers effectively.
Enhancing the storage space, flexibility, scalability, and 24/7 availability, cloud telephony solutions help companies in improving their operations. The system works on multiple networks and voice over internet protocol (VoIP) phone systems and switched telephone networks (PSTNs), streamlining business communications alongside.
The high use of cloud telephony has also enhanced the customer experience in the crucial times of pandemics when telephonic support is possible. Corporate spaces also have installed these systems to increase effective communication among themselves as operations have shifted to the online medium.
| Attribute | Details |
|---|---|
| Cloud Telephony Services Market CAGR (2023 to 2033) | 9.7% |
| Cloud Telephony Services Market Size (2023) | USD 22.8 billion |
| Cloud Telephony Services Market Size (2033) | USD 57.6 billion |
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As new components add up in the corporate structure along with the rising need for better and effective customer support, demand for cloud telephony systems rises excessively.
Key factors that help the cloud telephony services market in its growth are the increased need for telecommunication solutions, better feedback and response system, and remote working.
The ongoing trend in the market shows that small and medium-sized businesses seek telecommunication solutions in order to disseminate information regarding their products and services to market themselves. This being the key reason for the market’s growth is the transformation from traditional phones to IP telephony services that provide better connectivity and bandwidth to the telecom vendors.
Migration from the old telephone lines to IP Telephony systems has increased the ROI in a lot of corporate spaces.
This has helped the vendors in marketing their products in new markets, pushing the sales of cloud telephony services. This made cloud telephony services a better and more efficient way to communicate and connect. Another factor fueling the market is the high penetration of mobile phones that has fastened the migration from regular lines to ISDN and PSTN.
It provides better scalability, better user interface, flexibility, and 24/7 availability or support. It gives small and medium business owners an easy and subtle way to be connected with their customers.
Owing to its call reporting and tracking system, cloud telephony has becomes a better and more technologically advanced way to communicate. Therefore, companies are now focusing on creating awareness about the services and launching new products that work well with the advanced technology available. For instance, brands now launch products that come with multiple connectivity features like the Internet of Things (IoT).
Customer behavior and concern over data privacy and security are restraining the growth of the market. The market declines as big corporations set up their private networks restraining the demand for cloud telephony services.
The need for more investment in small and medium enterprises is also hassling the growth of the cloud telephony services market. As covid-19 destroyed multiple companies’ basic structures and finance systems, companies now try to invest in fixing the damage. This restricts them from investing in the telecommunications department of their workspace.
| Countries | Revenue Share % (2023) |
|---|---|
| United States | 16.6% |
| Germany | 9.2% |
| Japan | 6.2% |
| Australia | 2.3% |
| Countries | CAGR % (2023 to 2033) |
|---|---|
| China | 8.6% |
| India | 11.5% |
| United Kingdom | 9.1% |
The cloud telephony services market is divided into regions; North America, Latin America, Asia Pacific, Middle East and Africa (MEA), and Europe. The leading market is the United States which held a market share of 16.6% in 2022. Though, the overall North American region held a market share of 28.2% in 2022.
The region is expected to hold a market revenue of USD 12 billion by the end of 2033. Another reason behind the extensive growth of the cloud telephony solutions and services market in this region is the high competition and new private players in the sector.
Apart from this, Germany held a market share of 9.2% in 2022, while Europe held a market share of 24.3% in 2022. France also grows along with Germany, with a forecasted value of USD 3.5 billion at a CAGR of 9.8% between 2023 to 2033
| Category | By Deployment Mode |
|---|---|
| Leading Segment | Cloud |
| Market Share (2022) | 52..3% |
| Category | By Enterprise Size |
|---|---|
| Leading Segment | Large Enterprise |
| Market Share (2022) | 62.2% |
The cloud telephony services market is categorized by deployment, enterprise size, network, application, and industry. These categories are further divided into small segments that expand their channels in multiple market spaces.
These segments perform differently in multiple markets as they have a stronghold in multiple regions. The deployment category is segmented into hosted and cloud, while enterprise size is segmented into small & medium enterprises (SMEs) and large enterprises.
The network category is divided into public switched telephone networks (PSTNs) and voice over internet protocol (VoIP), and the application category holds four segments; conferencing, multi-level IVR, sales & marketing, and customer relationship management (CRM).
By deployment, the FMI study finds that the cloud type of deployment has a massive sales potential through 2033. The adoption of cloud systems is likely to record a CAGR of 9.1% during the forecast period.
Consumer demand for cloud-type deployment is attributed to its characteristics, like easy implementation, secured loops, and more reliability. In the future, sales of cloud-based cloud telephony systems are estimated to grow in proportion to the need for effective communications. This pushes the sales of cloud telephony systems into new markets.
By network, voice over internet protocol (VoIP) is the leading segment in the cloud telephony services market and is expected to hold a key portion in the forecast period. The segment is thriving at a strong CAGR of 14.3% during the forecast period.
The factors behind the growth of this segment are cost-efficiency, better connections, and a user-friendly interface. Though the public switched telephone networks (PSTNs) segment is also likely to grow at a promising CAGR through the forecast period, fueling the overall sales of cloud telephony systems.
The competitive landscape of cloud telephony is diversified and makes the market more exclusive for new players. Old telecommunication giants also release their new updated IP telephony systems that help in communicating with their customers. Vendor companies focus on mergers and collaborations to expand their distribution channels in new areas.
Market Developments
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In 2023, North America is anticipated to hold 34% of the market for cloud telephony services.
Asia-Pacific's market for cloud telephony services is anticipated to increase from USD 12.3 billion in 2023 to USD 27.4 billion by 2033.
In the market for cloud telephony services, China is predicted to experience exponential growth.
The expanding use of cloud computing, the rise in need for mobility, and the demand for scalability are what are driving the sales of cloud telephony services.
The market for cloud telephony services is propelled by the rising popularity of cloud computing and the rising demand for mobility, scalability, security, and analytics.
| Estimated Size, 2024 | USD 132.2 billion |
|---|---|
| Projected Size, 2034 | USD 349.1 billion |
| Value-based CAGR (2024 to 2034) | 10.2 % CAGR |
| Estimated Market Size in 2024 | USD 624.8 billion |
|---|---|
| Projected Market Value in 2034 | USD 2,686.06 billion |
| Value-based CAGR (2024 to 2034) | 15.7% |
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