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Hosted PBX Market Valued at $20 Billion

November 22, 2017

Eastern Management Group released its latest report, “Worldwide Hosted PBX Market 2017-2022,” analyzing the total worldwide addressable market (TAM) of hosted unified communications. Its research suggests the hosted PBX TAM will be roughly $20 billion in 2018, with 54 billion seats deployed.


The study, conducted over four years, including interviews with 3,500 worldwide IT managers in 2017 alone (and more than 20,000 interviews over the course of the project), reveals that business of all sizes are well aware of hosted PBX as an option and are including it in their due diligence when considering new communications investments.  

Eastern Management Group closely studied the entire world of hosted PBX and how it factors in the overall PBX market, which included traditional PBXs, IP PBXs, hosted and hybrid cloud systems, and server virtualization.  Importantly, the opportunity for vendors is even greater than the $20B figure, which doesn’t consider add-on UC applications, like contact centers, video, and other related network and IT services that enable service delivery.

While North American businesses have been the most active in terms of hosted PBX implementation and have helped drive the market, Western Europe and APAC are expected to overtake the U.S over the next five years.  In fact, by that time, the U.S. will account for only 27% of the addressable market. 

The influx of hosted and cloud UC implementation presents a major opportunity for smaller players, which have thus far struggled to emerge from their larger competitors’ shadows.  As long as their technology is sound and they are able to meet SLAs, vendors that have, until now, played in the very small and small business space will have every opportunity to expand into larger markets. 

“Hosted PBX is past the tipping point and the technology has already dealt a blow to traditional premises PBX vendors and the PBX equipment market as a whole,” said Eastern Management Group President John Malone.  “A $20 billion addressable market is now up for the taking by UCaaS players.”

Hosted PBX services currently account for about 18 percent of the overall PBX market, a number expected to climb significantly over the next three years, as analysts generally expect hosted/cloud to overtake on-premises deployments by 2020.

Isn’t it time for your business to move to the cloud?




Edited by Erik Linask

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