UCaaS cost: How switching can help

Mike Butts profile image March 14, 2024 | 4 min read

Understandably, the cost of unified communications as a service (UCaaS) is top-of-mind when transitioning to a cloud-based unified communications solution.

In general, as-a-service solutions are considered cost-effective alternatives to on-premises systems.

Even an enterprise communications solution, with its large-scale considerations such as complex UCaaS migration and customizations, offers significant cost savings (especially compared to upgrading and maintaining traditional phone systems).

So, do you wait or make the switch now? To help you decide, let’s take a look at what you should know about the UCaaS switching cost (versus staying with an on-premises setup). For a more in-depth look at unified communications, check out our guide to UCaaS.

1. What are the upfront UCaaS expenses?

Every established enterprise knows the initial expense of an on-premises system. There’s the upfront investment, followed by ongoing costs and maintenance fees.

Compared to owning and managing on-premises communications, switching to a UCaaS solution requires much less upfront expense.

Some of the costs you might encounter with a UCaaS switch include:

    • Increasing internet bandwidth

    • Buying new phones

    • Doing router upgrades

    • Paying initial licensing fees

Optional expenses you may consider:

    1. Fiber optic installation

    2. On-site team training

As you interview UCaaS providers, ask them about any initial one-time costs, as well as ongoing monthly costs of unified communications. Every provider has its own UCaaS pricing to complement their different feature sets.

2. Pay for easy-to-scale plans with features you want

One of the problems with traditional phone service is complicated billing that is difficult to interpret. Often, businesses get into a set-and-forget mindset; they implement a business phone system, start using it and pay the bill each month.

At some point (maybe when researching a UCaaS solution), they discover they’re paying for features or phone lines they haven’t been using. Bound by contracts, they often have little choice but to absorb the cost.

This is where businesses come to a crossroads: Continue to pay the inflated phone costs or switch to a cloud communications solution now with precise and predictable pricing?

Plus, unlike some of the original one-size-fits-all communications solutions, one of the benefits of unified communications is that some providers can offer customizable configurations. This type of flexibility allows enterprise businesses to get and pay for a UCaaS plan with the features they need. They can also add or remove lines as their team size changes or as business requirements evolve.

3. Where cost and benefits intersect

It’s understandable to feel bound to a legacy setup due to a hefty equipment investment and ongoing contracts. However, UCaaS is at the point now where switching is no longer optional — it’s inevitable.

What’s driving UCaaS adoption?

First, it’s important to understand that UCaaS adoption is continuing to grow. Forbes Business Insights projects the global UCaaS market will nearly triple from $36.33 billion in 2024 to $107.51 billion in 2032.

So what’s driving this growth? There are a few key factors:

    1. A growing population of remote workers: The modern workplace provides employees more opportunities to work beyond the brick-and-mortar office. Thanks to cloud services, employees have greater flexibility with where and when they work. Cloud UC offers these workers an always-on, easy-to-access work platform.

    2. Bring your own device (BYOD) adoption: As more workers use their own smartphones, laptops and tablets for work, businesses need a solution to help secure company data and align the use of third-party applications. UCaaS provides a data-safe mobile experience by providing personal-device users with number forwarding and app-access via the communication platform.

    3. Workers expect modern communications: It’s unrealistic to expect workers to use dated technology. For businesses to attract and retain the best talent, employees need modern communications. A cloud unified-communications solution will give them the tools they need.

On the customer side:

Your customers expect an efficient, automated, mobile-ready buying experience. Businesses that cling to a phone-only system run the risk of alienating these tech-forward customers. People want options, and they like to text to communicate with the businesses they use.

UCaaS enhances customer experience with support options via messaging, voice or video. Additionally, CRM integrations provide customer service reps with real-time data to better assist the customer.

Weighing the cost of waiting versus moving to a UCaaS solution now

As you make your decision, there are two ways to evaluate the cost of switching versus squeezing the last bit of juice out of your existing phone service.

First, there’s the money you will save by switching to cloud-based UC.

Second, there’s the money and time you spend on upgrading and maintaining your current phone system over the long term.

When you weigh the costs, it’s important that you don’t focus solely on the immediate costs, but to think about the long-range benefits for your business. For example, there’s a good chance that maintaining a legacy phone system will grow more expensive over time, especially if your business moves toward a hybrid model.

As you make your decision, look for providers like Ooma with excellent customer service. Be sure to check out our UCaaS plans to see the full breadth of what we offer.

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