Vonage Adjusts Focus and Targets Untouched SMB Market with Cloud Services

by Istvan Fekete on June 2, 2015

There is still plenty of the small to medium business (SMB) market that remains untouched, says Alan Masarek, CEO of Vonage, speaking to investors during the Cowen and Company Technology, Media & Telecom Conference.

Actually, cloud-based services are a good fit for SMBs because of their low cost: They don’t require the management and maintenance of on-site voice and data equipment. Vonage is looking to explore and capitalize on Unified Communications as a Service (UCaaS), the CEO suggested during his speech.

“UcaaS today is only a 15 percent penetrated market so the sale that a cloud PBX provider makes is I am offering you no hardware, lower operating cost and infininite scalability,” Masarek said. “The technology is a better alternative to what has existed before.” “We don’t sell that often in an RFP situation against Ring Central, for example, but rather the 85 percent of the market that has not yet moved to the cloud,” Masarek said. “That’s where you’re stealing the share from.”

Vonage’s move comes at a time when VoIP and cloud providers are eager to move up market into larger business accounts.

Masarek pointed to Vonage’s recent sales numbers: While its competitors are moving up into larger business accounts, the company is adding 2,500–3,000 new customers per month.

This won’t last forever, though, and Masarek is aware of that: As more service providers step into the market, the competition will heat up.

However, the SMB market is what seems to be the focus, as Vonage’s revenue from the traditional consumer market is on the downslide. The SMB market seems to balance that. Two of the key drivers in the business VoIP market are managed IP PBX and cloud-based hosted PBX and Unified Communications services.

Did you like this post? TheTelecomBlog.com publishes daily news, editorial, thoughts, and controversial opinion – you can subscribe by: RSS (click here), or email (click here).

Written by: Istvan Fekete. www.digitcom.ca. Follow TheTelecomBlog.com by: RSS, Twitter, Facebook, or YouTube.

Previous post:

Next post: