The Future of CPaaS

October 2021

Sam Barker

VP of Telecoms Market Research

Mobile channels are becoming increasingly important for brands and enterprises to connect with customers, with service providers emerging that look to offer a comprehensive platform that enables the management of this communication. These are CPaaS platforms.

There are a number of services that can be considered part of CPaaS platforms, including messaging technologies such as SMS, RCS (Rich Communication Services) and OTT messaging applications. Also offered are push notifications, voice services and email.

It is important for CPaaS players to ensure that they are able to deliver traffic across the largest variety of technologies in order to attract the largest clients; however, as these channels become increasingly complex, the provision of managed services is likely to play a big role in an enterprise’s decision on which CPaaS vendor to use.

There are clear opportunities in the CPaaS space beyond merely providing communication services. We have identified financial and eCommerce services as key new services CPaaS providers should be looking to implement within the next three years, in order to offer a unique selling point over competitors. However, there are many aspects of a launch that must be considered to maximise the uptake of a service. 

RCS, and subsequently RBM (RCS Business Messaging), provide notable benefits to the mobile payments market. RCS offers significant improvements over the established SMS standards, such as vendor authentication and the growing trend of ‘conversational commerce.’ However, if payments over RBM are to be successful, RCS will need to adhere to payments legislation such as PSD2 (Payments Services Directive). This EU directive ensures the provision of Open APIs to enable account details to be shared and third-party vendors to initiate payments via these details. Critically, it also requires all payments to be subject to SCA (Strong Customer Authentication), a 2FA (Two-factor Authentication) process that includes possession (such as OTPs (one time passwords)), knowledge, and inherence.

CCaaS (Customer Contact-as-a-Service) refers to solutions offered to brands and enterprises that enable them to run their own contact centres and manage inbound customer communications. This can be considered the opposite of CPaaS services that enable inbound consumer communications. Therefore, given the agility of CPaaS players, it was inevitable that they would look to leverage their expertise in emerging IP-based communications technologies to develop services in the CCaaS space. 

The COVID-19 pandemic created significant problems for brands and enterprises and hindered their ability to generate revenue through established channels. However, customer service was also impacted by ‘work from home’ orders in many countries. Remote working solutions were implemented, however, specialist software was required to enable agents to work remotely. Whilst the offer of a SaaS-like service was being slowly rolled out, the pandemic certainly accelerated demand for such services. 

Industries such as retail, eCommerce, travel and hospitality are all served by leading CPaaS players in 2020 for outbound communications in the form of their communications platforms. Juniper Research believes that capabilities for two-way communication of services such as OTT messaging and RBM enable the ability to easily implement inbound communication services to their existing customers. However, instilling confidence in these services must be done before significant roll outs can be accomplished.