UCaaS apps such as Zoom, Microsoft Teams, and RingCentral have become commonplace across the business environment. UCaaS has become business critical services and is now a major factor to SaaS application growth and waste.
By 2026:
• SaaS spend will grow by 187% to $317B*
• UCaaS will consume up to 15% of SaaS spend
• UCaaS waste will average between 30-50%, resulting in $24B in potential waste annually
• SaaS waste will average 30%, resulting in $81B in potential waste annually
*With the Gartner Public Cloud Service Forecast prediction of 40% (MM: Where did we get this number from? See below for the source data) growth of overall SaaS (including UCaaS) applications in enterprises by 2026, sprawl is here and is becoming a major challenge for organizations.
While this growth has meant that organizations are already working to manage SaaS spending, many are managing their UCaaS licenses in the same way they would manage their other SaaS licenses and contracts. In order to manage UCaaS, you need to see the full picture. This means expenses, contracts, licenses, and usage.
Think you have a good handle on your overall SaaS expense management? Take a closer look at your UCaaS. If you're not applying call accounting best practices to UCaaS management, you're missing out on operational insights and cost savings beyond those identified with standard SaaS asset management.
Managing UCaaS from different angles
According to work undertaken by Deloitte, over 93% of CIO’s are planning to shift their software needs to SaaS-based solutions. With UCaaS occupying a unique area within a SaaS environment, it can be easy to treat the UCaaS products your enterprise uses in the same way you control and optimize your costs for SaaS.
Microsoft 365 is a good example of the unfortunate—and often costly—ongoing disconnect between UCaaS expense management and SaaS expense management.
With Microsoft Teams typically being bundled together with other SaaS products it’s common to assume that these costs can be treated the same as the rest of your SaaS expenses. But there are additional add-on costs unique to UCaaS within this SaaS stack, such as the Microsoft Teams calling plans, where Microsoft is your PSTN provider and allows you to take Domestic Calling Plans, International Calling Plans, and / or Pay-As-You-Go Calling Plans. This adds variability across contracts and licenses, creating an environment where underuse and overcharging can rapidly become a problem if unchecked. Without a solution that understands the needs of UCaaS in both call accounting and SaaS expense management solution areas, key information is missed, and overspend is significant.
There are many other hidden fees associated with UCaaS add-ons such as the cost of Direct Routing within Teams. What are you truly paying for your UCaaS service? You are likely spending tens of thousands of dollars every year on direct routing service you don't use. UCaaS can increase the cost of SaaS by 2 times or more, in some cases 5 times if Direct Routing is being used.
Direct routing, the cost of purchasing and maintaining DID inventory, and other broader communication infrastructure costs can also drive up UCaaS costs and are not included in SaaS asset management or technology expense management solutions.
While limited visibility into overages and variable charges are the main attributing factors to UCaaS spend escalation, UCaaS add-ons can double an E3 license cost, as well.
Our enterprise observations to consider:
- Most users don't need an unlimited plan and would be served more cost-effectively through downgrading. These users can be identified, and licenses returned or downgraded where possible.
- Many users with a metered plan either don't need a calling plan or should be on an unlimited (use too little or too much).
- Many users are using their mobile phone instead of their UCaaS service
- Many enterprises are 'copying' their on-prem / hosted PBX configuration to the cloud, not realizing that how people work and communicate has dramatically changed.
Calero is actively monitoring these and other relationships between call accounting and UCaaS use cases, and is the only provider enabling this modernized approach to management of call accounting.
Call accounting for 2022 (and beyond)
Historically, call accounting capabilities have focused on compliance, rate validation and chargebacks. Many of the needs in UCaaS management today are the same as old-school, on-prem PBX systems, where calls are collected in buffer boxes and records are still often analyzed using spreadsheets and manual processes, leading to waste of up to 50% going under the radar. While these processes are now streamlined with APIs and other tools, there’s still a tremendous amount of data to analyze and correlate. Without an easy way to gather and interpret data in a similar manner to traditional call accounting, spending can’t be effectively managed, making overspending a certainty.
With the technological shift to UCaaS-based communications, those traditional elements of call accounting are at the heart of digital transformations:
- Automated DID inventory improves efficiencies by eliminating manual tracking and spreadsheets
- Usage intelligence gives you complete visibility of historical call detail records (CDR) and meeting usage, including licenses and variable charges
- And additional expense management brings added value and optimization:
- Unified expense management automates, centralizes, and links contracts, inventory, and invoice processing to reduce resource overhead. Downgrade/Upgrade calling plans - Analyze hundreds of thousands to millions of call detail records
- Value management improves usage of existing UCaaS services by understanding how they are being used and where they aren't being used
- Descriptive, prescriptive, & predictive analytics provide visibility and control at all levels of detail to improve decision-making
Using a SaaS expense management platform with the ability to apply call accounting principles to UCaaS data, you can finally surface actionable insights to effectively control, and manage your UCaaS apps.
This includes but is not limited to:
- Service usage at an individual level
- License visibility
- Add-on functionalities that are most and least used
- User access frequency through desktop, mobile apps, and the web
- Usage and calling patterns
- The ability to identify and return licenses
- Direct integration to your HRIS to easily handle new and ex-employees
- Fully customizable reporting through Power BI
Advanced UCaaS expense management tools can help answer important questions like:
- Are employees using the SaaS tools provided by the company? Which features do they use the most?
- Are workers using hotspots to collaborate, or for some other use that would be better supported with a different technology?
- Do you have outcroppings of redundant UCaaS apps with similar functionalities in use across different departments?
- Do users’ calling patterns align with their individual subscription tiers?
The new generation of call accounting provides critical context around how people are communicating and collaborating, as well as the variable expenses that need to be considered as part of an effective SaaS expense management strategy. The right SaaS management solution blends call detail records and connect them to cost center, individual, other SaaS apps, etc. Together, the insights can reveal the total cost of ownership for each end user and enable you to take meaningful action to save money, deploy apps to improve productivity and collaboration, and to reduce wasteful spending.
UCaaS is a subset of SaaS. But most SaaS management doesn’t care about variable expenses and real usage. Without the visibility and insights delivered by next generation call accounting capabilities, you can’t find the savings and other spend optimization opportunities that exist in your SaaS stack. If you don’t have control over every aspect of your UCaaS, you are not fully optimizing your SaaS estate.
