BMIT’s latest Voice Services and UC&C Report shows how unified communication and collaborative applications, such as WhatsApp and Microsoft Teams, have now become the go-to means of communications for individuals and enterprises. Chris Geerdts, Managing Director of BMIT, says that these platforms offer users enhanced functionality at a fraction of the cost of voice services.

BMIT’s projection, in the graph above, is that the mobile voice business, which is by far the most significant contributor to this market, will drop to R22.5 billion by 2028, less than half of its value in 2020, although there was some growth seen until 2021. The drop is driven largely by consumer behaviour and is in keeping with global trends.

The fixed voice market is projected to decline at an even faster rate, dropping by 64%, to R3.1 billion over the same period. Geerdts notes that “the drop would have been more substantial, were it not for the government sector, which, whilst embracing platforms such as Microsoft Teams, has also been slower to transition away from traditional voice usage and continues to set aside significant budgets for metered voice minutes.”

Meanwhile BMIT projects the unified communication and collaborative (UC&C) market to almost treble in size in the next four years. This market grew by 20% CAGR from R1.5bn in 2020, to R2.6 billion in 2023, and BMIT expects continued growth, at 11% CAGR, to reach R4.3bn by 2028.

Geerdts says research confirms that WhatsApp has strengthened its position as the most popular application for daily communication by individuals and smaller businesses, with its compelling offer of free calling and messaging, together with a useful group communication functionality. He says that due to its high penetration amongst consumers, businesses are engaging with customers through WhatsApp business accounts. With smaller companies, this may be one-on-one interaction, whilst larger companies are increasingly taking an omnichannel approach to their customer interaction, integrating these channels into their traditional contact centres and other businesses, as seamlessly as possible.

Geerdts notes that whilst there are large global players in the market, local service providers have also developed impressive converged business-to-business communications platforms, as well as omnichannel customer interaction platforms, aimed at providing a better customer experience whilst offering significant improvements in efficiencies.

BMIT’s research is also seeing an overall migration to cloud-based PBXs, although an appreciable number of companies, especially SMMEs, continue to prefer on-site PBX systems. Cloud adoption makes sense, given the popularity of other UC&C platforms, such as Microsoft Teams, Google Workspace and Zoom. Teams has emerged as by far the most popular platform used in South Africa, with BMIT projecting 2.2m paid activations by 2028.

Geerdts points out that the growth of UC&C services only partially offsets the decline in tariffed voice revenue. UC&C revenues counted by BMIT include hosted PBX and contact centre services as well as UC&C-centric services such as Microsoft Teams. He says that a number of opportunities are outlined in the report, but one major contributor to the revenue opportunity is cloud-migration, which is also driven by the increased integration of traditional voice services, collaboration platforms and business systems. Whilst many companies realise they need to integrate their systems to remain competitive, some have concerns about the complexity of the integration, and there are concerns about security and data privacy. BMIT expects cloud-based call control (a combination of Hosted PBX and UC&C platforms with breakout) to grow to 1.2 million users in 2028. This represents only a quarter of potential users, revealing a significant opportunity with the headroom for further growth.

About BMI TechKnowledge:

BMI TechKnowledge is a leading provider of market intelligence and consulting services for the ICT industry in South Africa. The company has a team of experienced analysts who provide in-depth analysis and insights into the latest market trends. BMI TechKnowledge also offers consulting services to help businesses develop and implement their ICT strategies.

The report provides a detailed analysis of the South African voice services and UC&C market, including market size, segmentation, drivers, inhibitors, and competitive landscape. It is an essential resource for anyone involved in the South African ICT market.