BroadSoft Buys Cloud Communications Vendor VoIP Logic

The move will bolster BroadSoft's own UCaaS effort, including its BroadCloud managed services and UC-One family of communications services.

Cloud UC

BroadSoft is building out its cloud communications portfolio by acquiring VoIP Logic, a company that delivers cloud services based on BroadSoft's BroadWorks to service providers in the United States.

Officials with BroadSoft said that VoIP Logic's cloud-based wholesale business model will be added to their BroadCloud managed services lineup and will enable service providers to take advantage of the company's capabilities within its BroadWorks and UC-One family of offerings while they migrate to a cloud model.

"We see that a large percent of data consumed by today's business is through cloud services, which is why BroadSoft has become the go-to cloud transformation partner for service providers seeking to rapidly shift their legacy telecom infrastructure to a network capable of delivering enterprise cloud applications for mobile unified communication, team collaboration and customer engagement," Taher Behbehani, chief digital and marketing officer at BroadSoft, said in a statement. "VoIP Logic further strengthens our BroadCloud UCaaS [unified communications-as-a-service] solution portfolio, and the ability for our service provider customers to fully benefit from the cloud."

No financial details regarding the acquisition were announced. For the entire year, BroadSoft officials said they expect VoIP Logic to contribute about $800,000 in revenue.

The enterprise communications market continues to transition to UCaaS, and vendors like Cisco Systems, Microsoft, ShoreTel, Mitel and Vonage continue to build out their cloud portfolios. Analysts with Synergy Research Group said in a report earlier this year that the UCaaS market will grow at 16 percent a year.

"UCaaS continues to be a force for change within the business communications market," Synergy's founder and Chief Analyst Jeremy Duke said in a statement at the time. "There has been a rapid rise of some disruptive new vendors and I do not expect the pace of change to slacken."

BroadSoft released the results of its own survey in October 2015 showing that cloud UC market penetration will jump almost six times between 2015 and 2020, when it will account for about 41 percent of the overall UC space. The company said UCaaS accounts for about 7 percent of the market today. Around the same time, the company unveiled Project Tempo, a strategy based on the UC-One platform aimed at integrating real-time communications and collaboration tools as well as cloud applications.

The company's BroadCloud is a manage service that provides customers with BroadSoft's UC services using the Rialto operating platform. Given the white-label nature of the offering, service providers can put their own brand on it and sell it to customers. UC-One is the portfolio of BroadSoft's UC and collaboration services, such as instant messaging, presence, video conferencing, mobile applications, and desktop and file sharing.

BroadWorks, the company's flagship offering, is a platform for voice-over-IP (VoIP) applications that service provides can deliver to their customers.

According to BroadSoft officials, VoIP Logic already offers cloud PBX services and UC-One applications to customers, and will be a complement to other services BroadSoft is providing customers.

The company announced the VoIP Logic deal Oct. 31, the same day they released third-quarter financial numbers. During those three months, BroadSoft generated $84.1 million in revenue, a 22 percent year-over-year jump from $69.1 million. The company also narrowed its losses, dropping from $3.3 million during the same period in 2015 to $600,000 in the third quarter.

For the first three months of 2016, revenue hit $239 million, a 26 percent jump from the $189.3 million last year. The net loss was $5 million, less than half of the $11.4 million BroadSoft lost during the first three months in 2015.