CPaaS platforms inject programmable voice, video, and SMS messages across enterprise applications.
To do so, they leverage operator networks, which telcos have invested big money into.
Now, CPaaS providers are beginning to reap the rewards, with Gartner predicting 90 percent of businesses will leverage CPaaS platforms by 2026. That’s up from just 30 percent in 2022.
Indeed, the CPaaS market is on the rise, and now telcos want to get in on the action.
The Trend
In 2022, global telco giant Ericsson completed its $6.2BN megadeal for Vonage, with CPaaS cited as the deal’s primary driver.
Soon after, Proximus acquired a 58 percent stake in Route Mobile and Skyvera acquired all the assets of American Virtual Cloud Technologies.
Alongside these headline-hitting deals, other prominent telcos have announced close collaborations with CPaaS providers.
In May, Nokia teamed up with Infobip to “accelerate CPaaS API development.”
Shortly before that, Deutsche Telecom and T-Mobile US kickstarted a mutual developer program to expose their network APIs.
Sharing more examples in an interview with CX Today, Rob Kurver, Founding Partner of the CPaaS Acceleration Alliance, summarized: “The potential of the entire Telco API play is enormous.
“There's so much happening in the world of CPaaS. You can see that the telcos are starting to become active in different ways, sensing they have an opportunity.”
The Opportunity
For years, telcos have faced a troubling question: how will we find news ways to monetize our big investments into networks?
CPaaS may offer the silver bullet, allowing telcos to deliver new, complementary API solutions – which their 5G networks can greatly enhance.
By acquiring and partnering with CPaaS providers, telcos are shortcutting that journey and reducing time-to-market for new solutions.
There are several other benefits to these arrangements. For example, telcos can immediately access robust developer communities, pool together a vast data reservoir, and reach new audiences.
However, perhaps most pertinently, telcos and CPaaS players can leverage shared knowledge and merge their strengths to build superior solutions, with substantial connectivity and reach.
Why Not Go It Alone?
Telcos have tried to dip their toe into the CPaaS market before. Think about Telfonica’s Bluevia, Deutsche Telekom’s Developer Garden, or even the GSMA’s OneAPI initiative.
Yet, while each project seemed to imply that telcos know what developers want, they fell short of that. For instance, they often charged for accessing and using low-value APIs, and that proved a significant hindrance.