What is CPaaS and why is it good for your company?

Edee Carey2020-08-20

CPaaS is the latest industry buzzword. But what does it really mean and why does it matter for your organization?

IDC predicts the global Communications Platform as a Service (CPaaS) market to reach over $17 billion by 2023, with a compound growth rate of 39%. Here we’ll explain more about this important term, how it compares to basic SMS, and how your company can benefit from CPaaS.

What is CPaaS?

CPaaS stands for Communications Platform as a Service. Juniper Research defines CPaaS as “a cloud-based platform that enables businesses to quickly and easily integrate communications capabilities like voice, video, and messaging into their own applications, without needing to build backend infrastructure and interfaces. This enables them to add new capabilities such as chatbots, service agents and contact centers into their customer-facing applications with minimal effort.​” Ultimately CPaaS is about designing the engine behind communication services​ with the advantage of scalability.

At the heart of CPaaS is support and orchestration of multiple communication channels​, like:

  • SMS

  • WhatsApp

  • Facebook Messenger

  • RCS

  • Viber

  • Email

This opens the door to reach and delight an entirely new consumer base in seconds. As end users are moving away from SMS towards more modern modes of communication, CPaaS has proven to be more future proof.

What’s the difference between the SMS A2P Market and the CPaaS Market?

The market has naturally evolved from SMS A2P to CPaaS. Popularized in the 1990s, the SMS A2P (application to person) market is based on SMS message delivery and focused on the telecommunications ecosystem. This mature industry is making way for the CPaaS market, which, with the possibility of omnichannel capabilities, has a larger addressable market and a wider set of communication use cases. The CPaaS market is a newer phenomenon with many stakeholders, including:

  • Telecommunications

  • OTT

  • Email

  • Voice

  • App push providers

As the demand for flexibility accelerates, CPaaS is rapidly replacing SMS A2P as the industry standard.

Why is CPaaS important for your company?

CPaaS ensures that your business doesn’t need its own hardware to connect to your customers and provides the opportunity for deeper value-based solutions in addition to core communication capabilities​. It allows for easier, faster, safer, and more cost-efficient customer engagement. Built on top of APIs, the CPaaS portals allow you to manage and use products and services in value–added “apps.” Communications are made simpler because you have access to your customers’ preferred channels streamlined into one place.

If you don’t use your customers’ preferred channels, your competitors will!

CPaaS allows you to connect with your customers their way through various channels. Customers expect a tailored experience, and, with access to multiple channels, your company has options to reach the right customers the right way. While SMS has a 98% open rate, reaching your customers through the most relevant channels increases engagement and user experience. If you don’t use their preferred channels, your competitors certainly will! It enables you to bridge your business with current, new, or potential customers across communication networks. The use cases for CPaaS are endless – from delivery notification to retail marketing to reminders and alerts. CPaaS allows you to engage, support, inform, and convert your customers more effectively than ever.

Do you want to know more? Get in touch with your LINK Mobility representative to see how we can support you.