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NEC Repackages UNIVERGE Cloud Services Offer

July 01, 2014
By Sandra M. Gustavsen, Analyst, Business VoIP

NEC has made significant changes to its hosted/cloud Unified Communications (UC) service called NEC UNIVERGE Cloud Services. Based on feedback from sales partners in the field, NEC has “unbundled” and “repackaged” the Unified Communications as a Service (UCaaS) offer and altered the pricing to be more in line with competing cloud offers. This includes re-aligning the telephony and unified communications features within each of the three package levels, as well as making new recommendations about the customer options for network transport, enhancing the management portal, improving the partner quoting tools and adding new requirements for technical support and service levels that will ensure a quality experience. NEC has also created a new division called NEC Cloud Communications of America and is instituting a “cloud focus group” to solicit ongoing partner feedback.


Introduced last March 2013, NEC UNIVERGE Cloud Services is available directly from NEC and through NEC channel partners in the United States, with plans to expand services to Canada later this year. To date, over 160 NEC partners have signed up to sell the subscription-based UCaaS service in addition to NEC’s on-premises telephony equipment portfolio; this is up from 80 NEC dealers a year ago.

Actual sales figures and market analyst findings about the rapid advances in hosted/cloud UC services are impossible to ignore. Providers of these services continue to report increases in cloud-based orders and rising renewal rates for their subscription services (more on this here). And, analyst projections all point to strong growth in the hosted/cloud UC market. For example, Frost & Sullivan forecasts that revenue associated with the North American Hosted IP Telephony and UCC Services Market will climb to $5.95 billion by 2019, up from $1.09 billion in 2012. Infonetics expects global VoIP services revenue to reach $88 billion by 2018 as more and more mid-market and larger enterprises evaluate and move applications to the cloud.

Trending Upward

NEC is unique in that it owns the UCaaS technology from end-to-end, including the servers within the NEC-managed data centers where the UNIVERGE software is hosted to the telephone or mobile device in the end-user’s hand (more on this here). Other hosted providers that rely on third parties for phones, switches, software and management of data center facilities may not be able to guarantee a high quality of service (QoS). NEC, however, manufactures the critical UCaaS components, continues to develop the UNIVERGE 3C call control software and applications, manages and provisions the Tier 3 data centers, manages a 24x7 Network Operations Center and monitors the MPLS network to identify and avoid QoS issues when transporting voice, data and video. “Over-the-top” deployments are also possible per specific NEC guidelines for network readiness, available bandwidth, network configuration and devices.

This “exclusive NEC” approach, and the company’s long history in communications, seems to be resonating well with potential customers. NEC indicates that the “pipeline” for its UCaaS sales is growing in number of generated quotes and also in the size of businesses evaluating the hosted/cloud alternative; customers opting for NEC’s UCaaS service now average about 135 users. NEC acknowledges a trend up-market and cites recent sales wins on the order of thousands of endpoints, including a large state university in PA that will utilize NEC’s cloud service to replace an on-premises PBX solution across 86 buildings and 3,400 endpoints and a national retail furniture chain that has some 12,000 phones in locations around the country.

Redesigned UCaaS Packages

NEC UNIVERGE Cloud Services come in three packages for varying user types which can be mixed and matched as needed. While the package naming remains the same (Basic, UC Standard and UC Premium), the package content has changed to create a more flexible and competitive offer. Some functionality can be added a-la-carte if needed such as voicemail, UC desktop and mobile clients, fax, video calling, call recording, queue groups, E911 features and more.

Additional collaborative applications are very close to general availability, including meet-me conferencing, Web conferencing, “Firebar” conferencing (for emergency dial-out conferencing) and NEC’s Mass Notification application. Other advanced applications are targeted for second quarter 2014, namely contact center, dual-mode mobility (Fixed Mobile Convergence) and hospitality.

  • Basic: The Basic user package, suitable for lobbies and common areas, comes with over 300 telephony features like call waiting, Caller ID, transfer, forward and 911 Service. Pricing is $15 per user per month (down from $20 originally).
  • UC Standard: General office users and receptionists will likely choose the UC Standard package which builds upon Basic to add TUI and Web-based Unified Messaging (voice and email integration) and a hard phone device license, as well as 75 minutes per month of pooled long distance calling. Pricing is $20 per user per month (down from $40 originally).
  • UC Premium: The UC Premium package includes all Basic and Standard functionality, but addresses the needs of power users and executives that require UC desktop call control with instant messaging and presence capabilities and device management. This package option also includes NEC’s UC Basic Mobility for extending calls to a mobile device, 2-way video calling and the selection of a hard phone or softphone device license, as well as 150 minutes per month of pooled long distance calling. Local calling is free with NEC’s MPLS network. New pricing is more competitive at $25 per user per month (down from $50 originally).

NEC’s Hybrid Approach

NEC's cloud service uses the company’s UNIVERGE 3C as the core software (the solution evolved from an IP-PBX acquired in 2007 when NEC Corporation of Tokyo Japan purchased Sphere Communications). Using the same software stream for both the premises and the cloud offer lends itself well to hybrid environments in which a business can flexibly deploy on-site equipment and subscribe to hosted/cloud services as needed - the same familiar features are available in either deployment model. The cloud service can act as a disaster recovery solution for an on-premises UNIVERGE 3C system, or vice versa. Or, businesses that have installed the UNIVERGE 3C at a main office can take advantage of the cloud service at branch locations.

On top of that, NEC is on the verge of introducing a number of standalone cloud-based applications that will be available as a monthly subscription to customers that have an NEC telephony system installed on-site. For example, customers that have deployed a UNIVERGE 3C or NEC SV8100/SV8300/SV8500 (or the forthcoming SV9000) system will be able to subscribe to certain hosted applications, rather than having to install any additional hardware and/or software. These “hybrid” applications will initially include Call Center, Conferencing Services, Mass Notification and Collaboration Services. Depending on the application, customers with older legacy systems may also be able to take advantage of NEC’s standalone, cloud-based applications by adding a gateway.

Going Forward

At the recent NEC Advantage 2014 consultant/dealer conference in Nashville, NEC reaffirmed its commitment to the future of communications, a future that is less about physical equipment and more about software, open standards, virtualization and the cloud. The company’s focused approach seems to be on target, as evidenced by recent industry analyst reports that rank NEC as a top competitor. In the latest annual study of IP Telephony and UC Cost Data from Nemertes Research, NEC had the lowest overall first-year costs when factoring capital, implementation and operational costs compared to other IP Telephony vendors in the study. NEC was also named by MZA as the leading vendor in the global PBX/extensions market for first quarter 2014; the analyst firm cites NEC’s strength in the Asia Pacific region and growing market share in North America.

Look for some major NEC announcements in the coming months, including a new series of next generation telephony and UC systems and additional cloud-based applications.




Edited by Maurice Nagle

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