Gartner 2013 UC Magic Quadrant: Maturity, Challenges, Directions for the Future

10 Aug 2013

The 2013 Gartner Magic Quadrant for Unified Communications (UC) was published on July 31, 2013. The report is authored by Gartner's leaders for UC, Bern Elliot and Steve Blood. A copy of the report has been shared publicly by Microsoft.

There was little vendor rating change from the 2012 UC Magic Quadrant, with no vendors moving to a different quadrant and little relative movement within each quadrant. The Leaders quadrant again shows Cisco and Microsoft with a distinct lead followed by Avaya and by Siemens Enterprise Communications.

The vendors in each of the four magic quadrants are:

Leaders: Cisco, Microsoft, Avaya, Siemens Enterprise Communications
Challengers: NEC, IBM, Alcatel-Lucent, Huawei
Visionaries: Mitel
Niche Players: Interactive Intelligence, ShoreTel, Aastra Technologies, Toshiba

The Gartner definition of Unified Communications has been refined even further this year and is an excellent encapsulation of UC. The essence is, "The primary goal of unified communications (UC) is to improve user productivity and to enhance business processes. Gartner defines UC products (equipment, software and services) as those that facilitate the use of multiple enterprise communications methods to obtain that goal." Gartner goes on to develop the details, including discussion of business process improvements with UC, which you can read in the report.

A vendor must have offerings in six areas to qualify for consideration in the UC Magic Quadrant: Voice and Telephony; Conferencing; Messaging; Presence and IM; Clients (the user experience software); and Communications-enabled Applications. More on these areas in the commentary below.

Three key points in this year's UC MQ are maturity, vendor challenges, and the directions for the future. Let's look at these.

Maturity

Gartner opens with, "The enterprise UC market continued to mature over the past 12 months and is now considered by Gartner to be entering the early mainstream adoption phase."

This reflects what we have seen here at UCStrategies, in our sessions and mock RFPs at Enterprise Connect 2013, and in our client engagements. Essentially all of the vendors have filled in their portfolios with viable software clients which include click-to-communicate via IM, voice, and video. Also, essentially all vendors offer voice and video conferencing with varying degrees of document sharing. Also, all vendors offer basic to advanced versions of user interfaces on mobile devices - laptops, tablets, and smartphones. Thus, the technology playing field looks pretty level when the vendors are compared on a feature checklist basis.

However, as reflected in the report, this maturity is not evenly distributed for two reasons, which we consider to be the Challenges of the UC market at this time.

Challenges

The first challenge highlighted by the report is enterprise and user adoption. In the opening summary, Gartner also says, "Products and best practices both for deployment and increasing end-user adoption will continue to mature during the next several years." The best practices point refers to the need for vendors to have clear justification and implementation programs to support their customers' success with UC. In some cases, the adoption challenge may be addressed by connecting the UC proposition either to other business productivity tools (e.g. Microsoft and IBM) or to network infrastructure (e.g. Cisco, Huawei, Alcatel-Lucent).

As to products, the main Gartner issue, with which we agree, is the evolution of the mix of premise and cloud options. Only a few vendors, such as Interactive Intelligence and Cisco (via a licensing transfer option), get compliments from Gartner for the seamlessness of their premise and cloud solutions. Clearly, more is required here and the trends toward seamless choices between premise, hybrid and cloud options are shown by reference to programs at Avaya, IBM, Microsoft, Mitel, and ShoreTel.

This first challenge is amplified by the second major challenge, which is immaturity or unpreparedness or lack of geographic coverage of necessary understanding, skills, and services in the vendors' channels. Gartner states "concerns" on these points for almost every vendor in the 2013 UC Magic Quadrant. For some vendors, the concern was mostly about the regional availability of the channels and support for UC; that would not be a specific vendor concern for companies operating only in well-supported regions. But for most multi-national companies, consistent skills and support coverage will be an issue.

Of even more concern, Gartner critiques many of the vendors for not having well-prepared resellers and system integrators, even where sales and service coverage exist. As we have been writing here at UCStrategies for the past several years, the Value Added Reseller (VAR) or Systems Integrator (SI) is a key element for success of enterprise UC implementations. As we look to the future, the development of advanced UC justification and implementation skills among a vendor's channel partners will likely be much more important than R&D spending, now that the products have matured.

The third challenge which Gartner highlights is the financial status of the UC vendors. As described in this recent post, the vendors who report financial results are showing slow or no growth in what appears to be a declining market for voice telephony (which is a very different category from UC). Gartner mentions a concern for the financials of Aastra, Alcatel-Lucent, Avaya, Mitel, and ShoreTel, all of whom are building their UC businesses as add-ons to a core telephony business. Interactive Intelligence appears to be an exception to this rule, but actually is not; as Gartner observes, Interactive Intelligence is actually building on their contact center business, which continues as a growing market sector.

On the other hand, no financial concerns are raised for those companies where UC is an addition to a growing, non-telephony product category such as e-mail, IM, and collaboration tools (Microsoft and IBM) or data networking products (Cisco and Huawei).

Directions for the Future

Gartner specifically says, this year, that, "The stakes for vendors in the enterprise UC market are exceedingly high and, in some cases, existential." Gartner goes on to identify five characteristics which, "will have an important effect on the success of a UC product and the satisfaction of the users:"

User Experience (UX)
Mobility
Interoperability
Cloud and Hybrid
Broad solution appeal

Except for Cloud and hybrid, all of these factors relate to the ability to deliver measurable changes in personal productivity or business process efficiency for the enterprise buyer of UC solutions.

In our enterprise UC consulting experience, we are seeing exactly this pattern. If there is no compelling reason to change, the vendors can bundle all the free UC licenses they want into the IP-PBX contract, but the UC functionality will not be deployed or adopted.

Increasingly, we are seeing communications "unified" with the applications and devices which the user must have to do their job. Thus, we are seeing companies focus on UC integrated to the e-mail inbox and IM client (both of which drive mobile device usage); integrated into business social apps (such as IBM Connections); UC integrated to business applications such as Salesforce.com, Microsoft Dynamics, or other vertical market apps such as the healthcare example cited in the UC Magic Quadrant report; communications built into collaborative workspaces; or communications simply embedded in mobile device apps.

This points back to the three challenges mentioned above. Which vendors will be able to deliver products, solutions and services which attach to the apps and role-based business functions which the user "must" have? Will the vendors have the resources to motivate and train their channels to serve the users' and enterprises' most compelling needs?

Recap

In summary, the Gartner 2013 UC Magic Quadrant shows that the UC market is maturing. The report also highlights the key factors which will determine success going forward. As always, the annual Gartner Magic Quadrant provides both a milestone to mark the industry's progress and a road sign indicating the directions and destinations for the future.

Please let us know what questions this year's UC Magic Quadrant raises for your organization, whether an enterprise, channel member or vendor; we will do our best to keep you informed of the critical variables for success with Unified Communications, Collaboration and Social for Business.