4 predictions for how cloud communications will mature in 2023

Five predictions for how cloud communications will mature in 2023

Worth an estimated $1,721.4 billion by 2030, the global cloud communications market is growing rapidly. While video continues to make up a large proportion of the market’s success, the use of streaming technology in other industries is on the rise.

As a recent Forbes article outlined “what started out as pure entertainment has evolved into the backbone of several major industries. How did we go from videos of kittens to businesses, governments, schools, and religious institutions relying on video as a default mode of communication?”.

Of course, an element of this evolution was necessary when people couldn’t go to the gym, kids couldn’t go to school and even places of worship had to close. Now that everything is back open again, the innovative use of streaming hasn’t ground to a halt. As the saying goes, certain industries didn’t know they needed live streaming until they had it and now they have, they’re not going to let it go.

For many industries, it has provided access to a much wider audience than before. That could be because people who couldn’t attend an event in person, can now join through live-stream. And companies have the ability to access previously hard-to-reach audiences via their preferred channels. For example, younger generations are much more likely to engage with live-stream delivered via mobile.

Communications platform as a service or CPaaS is a key player in enabling businesses to better communicate with their customers. It provides developers with an easy way to integrate real-time, direct communication between companies and their users without the need to develop and invest money in a separate app.

Cloud-based, programmable, and fully supported, CPaaS offers companies a range of different services including video conferencing, live chat messaging and unified communications as a service (UCaaS). In practice, these could be a chatbot popping up to offer help to a customer browsing a website or a manager using a messaging system like Slack to communicate with team members through existing company software. Unsurprisingly, it’s an area that’s growing.

As we close out 2022, we put forward our predictions for how these cloud communications platforms will start to mature more significantly in 2023 and transform the way that brands interact internally and with consumers and vice versa.

CPaaS will move beyond API

Now that it’s been around for some time and is seeing more demand for its services, the CPaaS industry is considering how it can expand its offerings. In 2023, we are likely to see communication platform as a service providers shift from simply providing APIs that allow organizations to communicate with customers via text, voice or video to a more customer-centric solution.

By customizing their offering to focus on a 360-degree customer retention and engagement approach, CPaaS companies will be able to offer customers onboarding support as well as innovative communication services and touch points via application to person (A2P) messaging. This will help them improve ROI by appealing to new customers and better retaining existing customers.

It will also help them move into massive growth areas, such as banking, healthcare and retail by replacing the traditional IT or procurement teams.

Artificial Intelligence will play a bigger role

More CPaaS providers are actively seeking to implement artificial intelligence (AI) and partner with larger AI providers to improve their product offering. We expect to see greater adoption and larger numbers of partnerships start to form in 2023 as this trend picks up speed.

By integrating artificial intelligence and machine learning (ML) into their solutions to provide speech recognition, automation, analysis of emotions, call analytics and augmentation of agents, CPaaS providers can help companies reduce the need for human contact and solve customer-related issues much quicker.

Conversational AI implementations within CPaaS are also likely to grow in 2023. Annual spending on the technology is expected to reach $1.99 billion this year, with AI automating 10% of contact center conversations and reducing agent labor costs by around $80 billion by 2026. That’s not to say that AI-powered bots will replace human interaction completely. There is still a place for the bots to gather the information from the customer and feed it back to a live agent to help reduce handling times.

Five predictions for how cloud communications will mature in 2023

We’ll see a rise in online classrooms.

Even before the pandemic, it was forecasted that the online education market will be worth $350 billion by 2025. New York City has already started to roll out two virtual learning programs for high schoolers, aiming to turn them into full-blown remote schools by 2023.

Around 1.2 billion children worldwide were unable to attend school due to closures during the pandemic and it caused an urgent reliance on technology, some of which had never been used before. It showed the global education industry that learning doesn’t necessarily have to take place in the classroom and can be just as effective when live streamed. Greater use of video, for example, can make the learning experience more immersive and condensed.

UCaaS will be a key part of delivering online classrooms and tutoring for this growth in online edtech in 2023 but latency of the streaming infrastructure will be crucial. Learning will be disrupted if there is lag between the teacher talking and the student receiving the information.

More meetings will take place in virtual reality

We may be back in the office, but the working environment is not the same as it was before. With remote work a more regular part of people’s working weeks, many meetings have remained within video conferencing platforms such as Zoom. But while communication platform as a service technologies have improved significantly in recent years, they’re still far from replicating the experience of having a meeting or a conversation in person. Sitting on the increasingly fine line between the real and virtual worlds, virtual reality or augmented reality technologies are offering businesses an experience far closer to face-to-face interactions.

This is not a trend that will suddenly become the norm in 2023. It’s likely to take a good few years for virtual reality to fully replace traditional CPaaS and UCaaS. But it’s slowly starting to mature and is already making its way into the workplace.

How could it look in practice? Instead of speaking to a colleague via a video call, you could be talking to a hologram of them, created through an augmented reality-powered device. Or companies could replace hard to follow manuals with simple instructions overlaid on a screen that a member of contact centre staff guides the customer through. If a customer wants a more life-like experience of a solution or product, they can be given a guided tour in virtual reality rather than just having to look at numbers and words on a page.

The BBC published a piece very recently with the headline ‘Your next job interview could take place in virtual reality’, quoting a study by Sandwell College in West Bromwich, UK where students used VR headsets to carry out mock interviews. Feedback from the students was that they felt comfortable expressing themselves because there was no human to judge them.

It’s perhaps indicative of a generation that has grown up with technology that they feel more comfortable interacting with a virtual human, but this story is also an indicator of how much more of our lives we may be living in augmented worlds thanks to improving streaming infrastructure.

Going beyond traditional communication

Chatting to AI-powered bots, learning via live-stream, metaverse meetings, doctors appointments over video call - there’s one thing we can agree on and that’s that 2023 will not be a boring one for cloud communication platform as a service. In fact, it’s going to go far beyond what many of us know it to be.

To find out more about dedicated hosting for cloud communications platforms including CPaaS and UCaaS, take a look at our industry page.


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