South Africa’s mobile voice market is continuing to decline, as platforms such as WhatsApp and Microsoft Teams become the go-to means of communications for individuals and enterprises.
This is according to local market research firm BMIT’s latest Voice Services and Unified Communication and Collaboration (UC&C) Report, which says simple voice services are rapidly giving way to popular unified communication, collaborative tools and omnichannel contact centres.
Chris Geerdts, managing director of BMIT, says UC&C platforms offer users enhanced functionality at a fraction of the cost of voice services.
BMIT points out 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.
It explains the drop is driven largely by consumer behaviour and is in keeping with global trends.
The market analyst firm points out that the fixed voice market is projected to decline at an even faster rate, dropping by 64%, to R3.1 billion over the same period.
“The drop would have been more substantial, were it not for the government sector, which, while 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,” says Geerdts.
Meanwhile, BMIT projects the UC&C market to almost treble in size in the next four years. This market grew by 20% CAGR from R1.5 billion in 2020, to R2.6 billion in 2023, and BMIT expects continued growth, at 11% CAGR, to reach R4.3 billion 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 notes that due to its high penetration among consumers, businesses are engaging with customers through WhatsApp business accounts.
Geerdts explains that with smaller companies, this may be one-on-one interaction, while 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.
He notes that while 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, while offering significant improvements in efficiencies.
BMIT is also seeing an overall migration to cloud-based private branch exchanges (PBXs), although an appreciable number of companies, especially SMMEs, continue to prefer on-site PBX systems.
The firm is of the view that 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 2.2 million 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 a number of opportunities are outlined in the report, but one major contributor to the revenue opportunity is cloud-migration, which is driven by the increased integration of traditional voice services, collaboration platforms and business systems.
“While 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,” says Geerdts.
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, it concludes.
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