Here's Who Made Gartner's 2016 Magic Quadrant For Unified Communications

UC Market Maturing, Consolidation Ahead

The stakes are high for vendors in the enterprise unified communications space as the market is now mature while overall growth has slowed. Underperforming UC providers will be forced to exit the market with vendor consolidation expected, according to Gartner's 2016 Magic Quadrant for Unified Communications.

Gartner predicts that the UC market will grow slightly from $41 billion in 2014 to $42.4 billion by 2019. While UC leaders Cisco and Microsoft still maintain their strong leads in the market, the Magic Quadrant vendor landscape has shifted with such vendors as ShoreTel and Unify moving positions.

Unified Communications Research Methodology

Gartner evaluated UC vendors that offer enterprise solutions for web and video conferencing, telephony, IM and presence, messaging, contact center, unified communication as-a-service (UCaaS) and interoperability capabilities, and that have clients for multiple environments. Vendors also need to have UC offers in multiple global market regions.

Gartner's Magic Quadrant ranks vendors on their ability to execute and completeness of vision and places them in four categories: Niche Players (low on vision and execution), Visionaries (good vision but low execution), Challengers (good execution but low vision) and Leaders (excelling in both vision and execution).

Here are the 10 vendors that made this year's Magic Quadrant for enterprise unified communications, along with Gartner's assessments of each company's strengths and weaknesses in the space.

Leader: Cisco

The San Jose, Calif.-based networking giant offers a full UC solution set that spans on-premises, hybrid and cloud deployment options. Cisco's on-premises solution is based on its established Cisco Unified Communications Manager (CM), which brings together voice, video, telepresence, messaging, presence and different forms of conferring.

Cisco acquired Acano for $700 million last year, adding new video solutions to its on-premise videoconferencing portfolio. Cisco also offers Unified CM as part of a cloud-based service — Cisco Hosted Collaboration Solution — provided by channel partners. The UC leader also provides a full range of endpoints, phones, room video systems and video solutions. Cisco is the leader in both vision and execution on the Magic Quadrant.

Cisco

Strengths: Key additions to Cisco's UC portfolio include Cisco Spark, a cloud UCaaS offering business messaging, meeting and call capabilities, as well as the integration of its CMR Cloud hosted video bridging service with WebEx. With a strong financial foundation, Cisco recently added technologies acquired last year from cloud API platform provider Tropo for embedded communications and customization.

Weaknesses: Gartner said Cisco has overlapping and competing functionality in its UC portfolio, making it challenging to understand its UC portfolio. Cisco's Enterprise Licensing Agreement favors businesses that plan to invest heavily with Cisco rather than competitors, meaning organizations with non-Cisco agreements are at risk of overpaying for UC solutions, according to Gartner.

Leader: Microsoft

Microsoft provides a broad UC solution set under its Skype for Businesses (SfB) brand, including its on-premise SfB Server and cloud-based SfB Online. The Redmond, Wash.-based software behemoth has been improving SfB Server around video, meeting capabilities and an improved client for mobile devices. Microsoft also has some additional UC configurations, most notably SfB Hybrid.

The bulk of Microsoft's SfB investments are targeting its Office 365 portfolio, which includes SfB Online. Microsoft is ranked No. 2 in vision and No.3 in execution on the Magic Quadrant.

Microsoft

Strengths: Microsoft can bundle its SfB product with its broad range of established business, collaboration and office products that leverage its dominance in enterprise IT and office solutions. The software giant also has a strong partner network to address the diverse range of global enterprise requirements.

Weaknesses: Gartner said enterprises regularly report dissatisfaction with the quality and capabilities of SfB audio and video conferencing functionalities and often maintain separate conferencing services for business-critical use cases.

Skype deployments require selecting multiple partner solutions. Microsoft has more than 900 partners in the SfB certification program and while it's improving its Partner Program, determining which partner to select is a challenge, according to Gartner.

Leader: Mitel

Mitel offers its MiCollab UC suite as the common solution across multiple call management platforms. The Ontario-based vendor's primary call management platforms are MiVoice Business, which targets midsize and enterprise businesses, and MiVoice MX-ONE, aimed at large enterprises. Mitel owns two contact center offerings as well as its UCaaS MiCloud service offered through channel partners.

In 2015, Mitel acquired Mavenir Systems, to boost UC mobile opportunities; and TigerTMS, to strengthen its position in hospitality. Mitel is ranked No. 2 in vision and No. 4 in execution in the Magic Quadrant.

Mitel

Strengths: Mitel has increased its overall competitiveness in North America and EMEA over the past two years, according to Gartner. Through the purchase of Mavenir, which offers cloud-based network solution for mobile carriers, Mitel is positioning itself in adjacent markets to provide communications services for mobile operators as Voice-over LTE comes to market.

Weaknesses: Gartner said that in order to expand, Mitel must advance and integrate its MiCollab and cloud solutions across a broad base of clients and products. With heavy competition, Mitel must make sure its channel partners can sell more than just the base PBX function, Gartner noted.

Leader: Avaya

The longtime Santa Clara, Calif.-based UC vendor owns its flagship enterprise-grade Aura Platform. Other elements in its UC portfolio include Avaya Aura Conferencing and Scopia Video Conferencing, which Avaya plans to integrate into a single conferencing solution in 2017. Avaya also offers a broad range of UC desktop, mobile, phone, endpoint and contact center solutions.

Last year, Avaya acquired Esna Technologies, a communications software company, and has leveraged its technologies to build new cloud solutions such as Zang -- a communications Platform as-a-Service (cPaaS) offering. Avaya is ranked No. 4 in vision and is in the middle of the pack in execution on the Magic Quadrant.

Avaya

Strengths: Avaya recently updated Avaya Breeze to offer an e-commerce capability: the Avaya Snapp Store. Breeze enables the development and deployment of UC solutions and modules, called Snap-ins, that can be used by multiple applications. Gartner also said Avaya has simplified its overall pricing and go-to-market strategy.

Weaknesses: Avaya has hired financial advisors to address its capital structure, and Gartner expects Avaya to pursue a comprehensive financial plan that could include refinancing, a debt-for-equity swap or asset sales. Additionally, while Avaya continues to consolidate its UC clients around Avaya Communicator, elements of the user experience are fragmented, according to Gartner.

Challenger: Alcatel-Lucent Enterpise (ALE)

ALE's flagship OpenTouch Suite (OTS) is a multi-device, multimedia UC suite with a strong foothold in Europe. OTS provides a fully unified and integrated UC solution that scales to 5,000 users and 15,000 endpoints.

The Paris-based vendor recently introduced Alcatel-Lucent Rainbow, a cloud-based service providing work stream collaboration functionality that includes presence, voice and video conversations, file sharing, search and tagging as well as chat-bot services. The solution will also offer cPaaS and APIs for extensibility. ALE is ranked in the middle of the pack for both vision and execution on the Magic Quadrant.

(ALE is 85 percent privately owned by China Huaxin and 15 percent by Nokia.)

ALE

Strengths: Gartner said ALE has a strong telephony market share in Europe to sustain continued investment in broader UC products and market development. Through Rainbow, the company is clarifying its long-term roadmap and the likely evolution options for customers.

Weaknesses: The vendor continues to lack visibility in the North American market, limiting its appeal to multinational companies, according to Gartner. Although ALE is introducing solutions in the areas of UCaaS, hybrid and work stream collaboration, it must close the gap with rivals who already have similar solutions in the market, Gartner says.

Challenger: NEC

The Tokyo-based communications provider is placing UC offerings within its broader portfolio, enabling NEC to better market UC and expand its channel partner base, according to Gartner. NEC's Univerge 3C software offers a complete UC suite based on a web-oriented and service-oriented architecture and open standards with enterprise scalability, security and centralized administration. The suite's functionality encompasses telephony, IM, messaging, video and all forms of conferencing.

The broader NEC portfolio includes integrated support for contact centers, business application integration and cloud through the Univerge Blue UCaaS solution. NEC is ranked No. 3 in execution and near the bottom in vision on the Magic Quadrant.

NEC

Strengths: Gartner said channel partners consistently report positive relationships and strong support from NEC. The company is in the process of creating seamless migration and interoperability between 3C and its Univerge SV9000 server series.

Weaknesses: Gartner says NEC is still building its global brand identity and needs to advance its marketing outside Asia/Pacific. Some of NEC's channel partners in North America and Europe are not enabled to support Univerge 3C, according to Gartner, meaning NEC needs to expand its partner enablement programs.

Challenger: Huawei

The $61 billion China-based communications behemoth has merged its enterprise UC and core networking R&D teams to develop cloud-based UC solutions for both enterprises and carriers. Huawei also combined its UC, telepresence and videoconferencing organizations.

Huawei's eSpace UC solution is made up of a broad set of applications and supports telephony, presence, messaging, multiple conferencing and whiteboard options, chat, video and contact center. Huawei has also released a software-based Unified Session Manager that can operate on standard PC servers. Huawei is ranked in the middle of the pack in execution, but last in vision on the Magic Quadrant.

Huawei

Strengths: Huawei offers its UC solution set as part of broader bundles of IT services and infrastructure. Its large portfolio of products spanning the carrier, large enterprise, SMB and consumer markets are providing a broad base to grow its UC solutions.

Weaknesses: With 65 percent of its revenue coming from the Asia/Pacific region and 22 percent from the Middle East and Africa, Huawei is very limited inside North America and Europe, according to Gartner.

Gartner said Huawei controls decision making and operations directly from its China offices, which creates communication challenges for customers, requiring professional services or customization outside the country.

Visionary: Unify (Atos)

Although Unify was acquired in January by IT services provider Atos, the company retained its name and UC product portfolio. Unify's OpenScape UC portfolio offers a full and integrated suite of functionality offered in three flavors depending on the number of users.

The Munich, Germany-based vendor has launched Circuit, a Software as-a-Service-based work stream collaboration solution. Circuit supports rich textual messaging, audio and videoconferencing, file and screen sharing, and other collaborative functions. Unify is ranked in the middle of the pack in both vision and execution on the Magic Quadrant.

Unify

Strengths: Gartner said Unify emphasizes an open and interoperable approach with multiple integration options. The flexibility, combined with Atos' existing market alignment, allows Unify partners to target requirements specific to particular verticals including education, energy, automotive, healthcare and the public sector.

Weaknesses: Unify's cloud offers are still emerging and the vendor needs to accelerate market adoption in this space, according to Gartner. Although Atos has established a presence in North America, it's still unclear if that will create more visibility and success for Unify, Gartner says.

Niche Player: ShoreTel

ShoreTel launched its Connect product line last year supporting the full set of UC functionality, from peer-to-peer video and support for communications to room-based systems. Sunnyvale, Calif.-based Shoretel provides a UCaaS solution, Connect Cloud, as well as an on-premise solution, Connect Onsite, which uses an appliance-based distributed architecture. It can also be virtualized.

In 2015, ShoreTel acquired Corvisa, a cloud-based communications provider that operates data centers in the U.K. and Amsterdam. ShoreTel is ranked in the middle of the pack in vision and near the bottom in execution on the Magic Quadrant.

ShoreTel

Strengths: The same software for ShoreTel's Connect Onsite solution also forms the basis for ShoreTel's UCaaS solution, Connect Cloud. Together, the products enable hybrid deployments as well as redundant appliance deployments.

ShoreTel has also ’harmonized’ its go-to-market offer across on-premises and the cloud, enabling consistent and transferable licensing for customers and partners, said Gartner.

Weaknesses: Although ShoreTel's UC features will satisfy the requirements of most midmarket organizations, Gartner said its solutions are not as feature-rich as some of its competitors. ShoreTel Connect is new to the market and has yet to establish a track record, according to Gartner.

Niche Player: Interactive Intelligence

Interactive Intelligence owns a Customer Interaction Center (CIC), an all-in-one software solution that offers both contact center and UC functionality. The Indianapolis-based vendor's CIC includes telephony, audioconferencing, rich presence with IM, and a range of client and device options offered on-premise, in a cloud configuration or as a managed service.

Last year, Interactive revealed PureCloud -- a multi-tenant, enterprise-grade cloud solution based on a microservice architecture that leverages Amazon Web Services. Interactive Intelligence is ranked in the middle of the pack in vision but last in execution on the Magic Quadrant.

Interactive Intelligence

Strengths: Interactive has seen success with its innovative and attractive flexible deployment offering, according to Gartner. That offering allows enterprises to convert on-premise deployments to cloud-based deployments or vice versa. The introduction of PureCloud has clarified how the company's next generation of UC solutions will evolve.

Weaknesses: Despite investments in its sales channel program, global coverage remains limited in a market dominated by larger vendors, Gartner says. CIC's web and video conferencing capabilities are not as robust as those of its competitors and may not meet the needs of enterprise conferencing requirements, according to Gartner.