Licensed for Distribution

Magic Quadrant for Communications Platform as a

Service
Published 18 September 2023 - ID G00784989 - 38 min read

By Lisa Unden-Farboud, Daniel O'Connell, and 2 more

CPaaS providers offer cloud-based platforms for developers and other users to build deeper
engagement and operationalize customer experiences via APIs, SDKs and visual builders for
basic, advanced and omnichannel communications. CIOs can use this Magic Quadrant to
evaluate providers.

Strategic Planning Assumption

By 2026, 90% of global enterprises will leverage communications platform as a service (CPaaS)
as a strategic IT skill set to maintain digital competency, up from 30% in 2022.

Market Definition/Description
This Magic Quadrant for Communications Platform as a Service is the first version of this Magic
Quadrant. It replaces the Market Guide for Communications Platform as a Service.

Gartner defines CPaaS as a cloud-based platform used by developers to build and integrate an
array of communications-related capabilities using APIs, software development kits (SDKs),
integrated development environments (IDEs) and documentation. The CPaaS tools facilitate
simplified access to multiple communications channels (spanning voice, SMS, other messaging
and video, along with security, such as basic authentication around the APIs). Many CPaaS
vendors are now offering low-code/no-code visual builder capabilities to help nontechnical
enterprise roles access CPaaS capabilities and to save developers time.

Minimum core capabilities

Gartner has set out a minimal set of basic core CPaaS capabilities. These include APIs to:

Send and receive SMS messages.

Place and receive voice calls.

Route voice calls via direct inward dialing (DID).

Register phone numbers (for the above-mentioned core capabilities).

 Confirm identity via methods, such as two-factor authentication/multifactor authentication
(2FA/MFA), flash calling, and/or silent mobile verification.

Minimal core CPaaS capabilities also:

Support APIs for at least one other rich communications messaging medium. For example,
Apple Messages for Business, RCS Business Messaging, Google Business Messages,
Multimedia Messaging Service (MMS), WhatsApp or WeChat, along with email. These rich
communications capabilities must take advantage of some of the unique features of that
medium; for example, emoticons, picture media, action buttons, voice and video calls.

Provide customer service and support for the above core capabilities, including customer
onboarding, technical support and usage dashboards.

Optional CPaaS capabilities

Optional CPaaS capabilities help enterprise buyers and developers with ease of functionality in
addition to the core CPaaS capabilities (mentioned above). Vendors may not necessarily have all
of these optional capabilities, but may have a mix of them. These capabilities include:

APIs for a wider array of messaging channels, such as email or advanced/rich messaging
channels (in addition to the ones mentioned as core capabilities). Additional rich
communications channels could include WhatsApp, WeChat, Apple Messages for Business,
RCS, Google Business Messages, MMS. Additionally, it could include LINE, Viber, Telegram,
push notifications and other social messaging apps (e.g., Instagram Direct Messenger, Twitter
DM, Discord or Snapchat) or rich messaging formats. These can be provided with an
omnichannel and orchestrated capability, and in the form of conversational APIs.

Advanced voice: including APIs for services, such as emergency/E911 communications, call
scoring, contact center (CC), audio conferencing, call queuing, interactive voice response (IVR),
music on hold, multimedia, speech to text, natural language processing (NLP), call recording,
sentiment analysis, branded calling. Additionally, there are optional basic voice services, such
as session initiation protocol (SIP) trunking, local number portability (LNP), calls from within
apps/webpages, and phone number authentication and anonymization.

Video: which includes programmable video APIs, such as video streaming and in-app video
service.

Advanced security and privacy: voice-facial-finger biometrics, call risk scoring, SIM verification,
call/delivery analytics, call tracking, dynamic route capabilities, along with anti-phishing and
anti-spam.

Programmable wireless: E-SIMs and Internet of Things (IoT)-packaged solutions and 5G-
enabled communications APIs.
 Other: APIs for payments or payment integrations, integration into third-party or own-grown
capabilities for customer data platform (CDP), CRM, AI and conversational bots on the above-
mentioned channels.

Advanced support: vendor marketplace, partner marketplace, visual builder, customer success
programs, customer development plans, compliances (vertical/horizontal), developer activities
(e.g., events-certifications-blogs). In addition, support for horizontal (e.g., campaign
management) or vertical use cases scenarios (e.g., banking, healthcare, logistics).

CPaaS vendors that have a wider base of services extending into these optional CPaaS categories
will have a richer product portfolio.
Magic Quadrant
Figure 1: Magic Quadrant for Communications Platform as a
Service

Vendor Strengths and Cautions

Alibaba Group

Alibaba Cloud is a Visionary in this Magic Quadrant. China-based Alibaba Group, which is publicly
held, is a cloud-based conglomerate with multiple business and consumer services, including e-
commerce, digital payments, entertainment, content, cloud compute. The CPaaS business in
Alibaba Cloud focuses on China and Asia/Pacific (APAC).

The company provides a rich base of basic and advanced CPaaS capabilities focusing on
developer support so that it can build solutions desired by its customer base. Alibaba Cloud
supports 2,800 global edge nodes to support its businesses for video, gaming and streaming
capabilities. Key ongoing market thrusts include expanding its API marketplace, building its
contact center and leveraging new generative AI advancements.

Strengths
Strong brand and deep presence in China and Southeast Asia (SEA), where it conducts the vast
majority of its business with significant regional support, ISP partnerships and local
capabilities.

Robust developer community terms of APIs, SDKs, documentation, training and events.

Expansive set of CPaaS capabilities, including advanced capabilities in video, payments, IoT, AI,
WhatsApp and security. These are being well-adopted within its customer base.

Cautions
Light presence in Europe and North America, where political headwinds constrain the adoption
of Alibaba Cloud.

The vendor lacks a holistic go-to-market (GTM) strategy as evidenced from its complicated
website, with various services scattered across multiple places. Likewise, support across the
individual services is variable.

Alibaba Cloud is just starting to build out an API marketplace to the major CRM, contact center
and ERP systems in comparison to other CPaaS vendors.

Bandwidth

Bandwidth is a Challenger in this Magic Quadrant. Publicly held and U.S. based, Bandwidth has
traditionally partnered with major unified-communications-as-a-service (UCaaS) and contact-
center-as-a-service (CCaaS) vendors with a rich portfolio of automated voice services. This is
abetted with automated tools to global telcos for number management, emergency
communications and voice network resiliency. Bandwidth is now a direct provider to large SMS
messaging platforms and Global 2000 enterprises.

Bandwidth touts ownership of its global network, connecting more than 65 country markets as a
competitive advantage to enable greater network control, resiliency and lower cost. Bandwidth’s
Maestro platform enables enterprises to consolidate connections to leading UCaaS, CCaaS, and
AI vendors via a flow builder.
Strengths
Bandwidth is strong across the voice ecosystem. This includes network resiliency, emergency
services, number management and regulatory expertise.

Customer references on Bandwidth are positive in terms of price, self-service capabilities,

dashboards and knowledgeable support staff when human engagement is required.

Bandwidth’s expansion to directly servicing Global 2000 businesses, which have similar needs
to its cloud vendor customers, is well-aligned to its current business model.

Cautions
Bandwidth does not offer a broad suite of CPaaS services and solutions, and is therefore not a
good fit for many nonvoice use cases. Rather, it goes deep on the CPaaS voice side.

The strongest offerings focus on North American-based organizations. Not all capabilities have
been fully embedded into the Voxbone acquisition, which covers Europe and APAC (though
Bandwidth cites this is in development).

Bandwidth has limited global brand recognition at the enterprise level. It is mainly known by the
major cloud providers as a way to connect with their customers.

Cisco

Cisco is a Visionary in this Magic Quadrant. U.S.-based and publicly held, its CPaaS solution,
Webex Connect, was added via the 1Q21 IMImobile acquisition (U.K.). Webex Connect also
powers Cisco’s Webex Contact Center digital channels.

Cisco has retained the IMImobile leadership team, resulting in a low-friction integration. The
business focus remains on digitally enabling Fortune 2000 enterprises, which often require
professional services and could temper growth potential. Cisco takes a best-of-breed approach to
capabilities such as AI, believing it is better to focus on CPaaS core competencies in the near
term. Customers value Webex Connect for its ability to integrate into existing back-end systems,
support global/vertical compliances, engage across multiple channels and provide consulting
guidance.

Strengths
Webex Connect has a good visual builder, viewed favorably by its customer base, for defining
business use cases like campaign marketing, customer conversations and e-commerce.

The solution offers a rich set of APIs across a broad base of cloud applications, spanning
contact centers, CRM and campaign marketing. This enables customers to get up and running
quickly.

The offering supports a wide variety of channels, spanning voice, video, email and messaging
apps (including Tier 1 messaging aggregation). In addition, it has experience enabling
customers’ success across all these channels as well.
Cautions
Webex Connect is a relatively new brand in the CPaaS domain (a capability that has been
available from IMImobile for years); therefore, it has limited brand recognition within the
developer and vendor communities due to the name change.

Cisco’s Webex Connect branding and website is not clear; it gets lost among other Cisco Webex
products, particularly Webex Contact Center.

The GTM strategy is still maturing relationships with systems integrators (SIs) and value-added
resellers (VARs). This currently results in fewer prepackaged vertical use cases.

Infobip

Infobip is a Leader in this Magic Quadrant. The U.K.-based company delivers complete CPaaS
solutions, including APIs for voice, SMS, MMS, email and multiple over-the-top (OTT) channels;
along with CDP, customer engagement, chatbot and CC solutions. It provides a developer
marketplace, along with a partner program for communications service providers (CSPs),
resellers, SIs and independent software vendors (ISVs). Infobip’s footprint covers EMEA, Latin
America (LATAM), APAC and North America, with local delivery, sales and support, serving
multinationals, local enterprises, telcos and partners.

Infobip continues to invest in automation with visual builders, professional services and developer
capabilities, building frameworks around ChatGPT, partner programs and networks, adding more
comms channels, and enhancing self-serve and advanced security features.

Strengths
Infobip owns a private network backbone with 43 data centers, enabling delivery and latency
guarantees. It has more than 9,700 global connections of which 800 are direct operator
connections.

Infobip’s solution-oriented GTM leverages its own and partners’ professional services, which
allows it to bring CPaaS to customers daunted by more developer-focused initiatives.

Customer references cited Infobip’s global reach and scaling capacity as strengths, along with
its flexibility, reputation, and responsive service and support. Its mobile identity and fraud
prevention services are also rated strong by customers.

Cautions
Infobip’s pricing is not always transparent and perceived by customers as relatively higher than
other vendors. This is attributed to high levels of customization and capabilities, and can be
adjusted based on customers’ expectations and needs.

Infobip’s brand awareness in North America is low despite acquiring Peerless Network and
OpenMarket. Infobip’s partner network in North America is immature.
 Limited developer awareness in North America; a customer reference cited its developer
documentation to be “average.”

LINK Mobility Group

LINK Mobility is a Niche vendor in this Magic Quadrant. Publicly traded and based in Norway, it
supports a standard CPaaS stack plus OTT channels (such as RCS, WhatsApp, Viber and
Facebook Messenger), a visual builder for CPaaS flows, along with chatbots and journey
orchestration, and a CDP for personalized marketing use cases. It serves customers across
banking, logistics, retail and more. The company has offices in Europe and North America, and
works with partners to serve APAC and LATAM.

LINK Mobility focuses on understanding customers’ use cases and working with them to craft full
solutions. Its local strategy has been driven by acquisitions in numerous countries. It is currently
working to align the branding of these acquisitions, and to expand online events to showcase best
practices and customer use cases.

Strengths
LINK Mobility supports several buying models, including developer and solution-oriented
motions, with each producing enough revenue to show that customers are successful with it.

In addition to its own visual builder, LINK Mobility supports both Azure Logic Apps and Power
Automate.

Customers have cited LINK Mobility as being enthusiastic listeners and that it addresses their
needs. LINK Mobility is one of only a few vendors in this Magic Quadrant with fax capability.

Cautions
LINK Mobility’s omnichannel conversational platform and marketing platform have not yet been
merged postacquisition of Xenioo and MarketingPlatform, leading to overlapping client
experiences.

Lack of vertical-specific templates may cause clients to take more development time to bring
LINK Mobility-based applications to fruition compared to other vendors.

Its platform has only a few new capabilities added in the last year because it is focusing on
integrating its acquisitions. Customers seeking vendors whose offerings will advance with their
needs should examine LINK Mobility’s roadmap.

MessageBird

MessageBird is a Visionary in this Magic Quadrant. Privately held and Netherlands-based, its core
business is CPaaS-centric, with its largest markets in Europe and APAC. The acquisition of U.S.-
based email vendor SparkPost enhances its North American presence.

MessageBird is a developer-focused CPaaS provider that also offers its own visual builder (Flow
Builder). The company leads with direct sales and is building out its SI partnerships for better
business scaling. Messagebird has a digital customer service platform that incorporates AI for
self-service in areas such as e-commerce. The Hull acquisition, also U.S.-based, provides a CDP
capability that can connect to MessageBird’s digital and legacy channels for campaign marketing.

Strengths
MessageBird offers a well-organized website for developers in terms of APIs, SDKs,
documentation, breadth of services and transparent pricing.

The company provides a broad swath of basic and advanced CPaaS services, complemented
by the SparkPost email acquisition in the U.S.

Strategic acquisitions in email (SparkPost), video (24sessions), AI (Hull) and Pusher have
enabled MessageBird to expand both its tech suite as well as its geographic footprint.

Cautions
MessageBird has low brand recognition in North America and Gartner was only able to get one
customer reference as part of our analysis.

The marketplace of prebuilt third-party applications, such as contact center, CRM and
marketing, is limited compared to some peers, but it is growing.

MessageBird is still maturing its relationships with SIs and VARs, which can play a critical role
in accelerating revenue growth.

Mitto

Mitto is a Niche player in this Magic Quadrant. Swiss-based and privately held, its CPaaS solution
provides basic communications (SMS, application-to-person [A2P], voice, WhatsApp and other
OTT messaging, email) along with 2FA, 10DLC, number cleansing and AI-based global routing for
large enterprises and wholesale customers. Mitto supports the U.S., EMEA, APAC and LATAM. Its
Campaigns and Conversations APIs can also be built low-code or templated for transactional use
cases, marketing and conversational experiences. Mitto also supports CRM and ERP integrations.

Mitto has invested in developer resources, omnichannel, dashboards and low-code capabilities.
It’s also investing in its online presence, sales support and partner integrations.

Strengths
Large enterprises, multinational corporations (MNCs), tech vendors and service providers who
require volume with global demand for SMS, 2FA and voice are attracted to Mitto’s value
proposition.

Mitto differentiates through its constantly monitored, AI-enabled network which prioritizes
routes for real-time reliability, enabling support of a different class of service (CoS) and prices
according to CoS.

Mitto has dedicated sales, support and customer success teams in the regions it serves,
notably in the U.S. and EMEA (along with self-serve). Customers rate Mitto high for proof of
 concept (POC), negotiations and pricing.

Cautions
Mitto’s visibility is low as identified with Gartner’s market momentum index (MMI), where
investment in resources for marketing have remained flat.

Mitto has been slow to respond to changing demands for advanced features, like CDPs or
contact centers. This is also evidenced by customers citing that Mitto should add support for
the latest technology.

Mitto’s operations in several hard-to-reach/emerging countries have revealed that SMS delivery
rates need improvement, as cited in the customer reference survey.

Route Mobile

Route Mobile is a Niche player in this Magic Quadrant. India-based and publicly held, it provides
SMS, voice and omnichannel support across several OTT messaging apps. The company has its
customer experience platform (CXPaaS), an AI botbuilder (Roubot) and integrations with CRM,
CDP, CC and AI vendors. Its TruSense suite provides number scoring and verification. It also
provides mobile network operator (MNO) A2P monetization, analytics and SMS firewall to detect,
analyze and protect from threats.

Operations are focused on South Asia and Singapore, along with emerging markets in the Middle
East and Africa (MEA) and LATAM, typically serving enterprises that have a demand for advanced
messaging and email. Route Mobile plans to invest in its developer program and deeper mobile
identity capabilities.

On 17 July 2023, Proximus announced it had entered into a definitive agreement to acquire a
majority stake in Route Mobile. At the date of publication, Route Mobile met the inclusion criteria for
this Magic Quadrant and Critical Capabilities, and continued to operate as an independent entity.
Gartner will provide additional insight and research to clients as more detail becomes available.

Strengths
CXPaaS supports a wide range of advanced use cases like brand loyalty, customer acquisition,
engagement and care via AI, bots, campaign management, CDP, omnichannel workflows and
analytics.

Strong capabilities in the Indian subcontinent, and one of the few CPaaS vendors supporting
African countries and LATAM (following the acquisitions of Masivian and M.R Messaging FZC).
It typically has direct sales/support to meet custom-made needs with business processes for
large customers.

Its TruSense digital identity suite provides phone number scoring and verification. It maintains
data residency jurisdictions and adheres to regulatory compliance, where data processing
agreements are with each customer and partner.

Cautions
 Limited support in North America and Europe. Route Mobile’s support tends to be horizontal
across its capability rather than any vertical-specific support.

Customers referenced cite a need for more updates and new innovative products, which would
include more dedicated technical resources.

Its payment capabilities are more restricted than others and it doesn’t yet offer flash calling,
Fast Identity Online (FIDO) or biometrics.

Sinch

Sinch is a Leader in this Magic Quadrant. Publicly held and based in Sweden, it offers an
expansive suite of CPaaS functionality that goes beyond the basics. It includes not just a wide
array of OTT messaging, but also APIs to upgrade existing SMS-based bots, its Chatlayer AI
chatbot/voicebot capability, its Engage conversational platform, and a broad set of CRM
integrations. While direct-to-enterprises and developer self-serve are its strongest paths to market,
Sinch supports an array of development partners to build full customer solutions backed with
strong SLAs. Its approximately 4,300 employees serve customers directly in all major regions.
More recently, Sinch has been focused on integrating its myriad recent acquisitions, both in terms
of branding and operations.

Strengths
The breadth of Sinch’s CPaaS offering, including more advanced features such as video and
email, is rivaled by only a few other vendors.

Its geographic spread, both in terms of revenue and local presence in the markets it serves,
bodes well for its ability to serve large and global enterprises’ full needs.

Its healthy balance between direct and indirect revenue indicates a strong ability to serve both
customers using a developer self-serve model and more solution-oriented clients.

Cautions
Sinch’s recent financial results reveal high debt levels which could restrict business agility.

Sinch delivered fewer new capabilities recently than comparably sized market leaders, as the
current focus is on acquisition integrations.

Customers referenced give it low marks compared to other vendors on its propensity to listen
to, and incorporate, constructive feedback.

Tanla Platforms

Tanla Platforms is a Visionary in this Magic Quadrant. India-based and publicly held, it has a
significant customer base in APAC (notably India and SEA), with complementary resources in
MEA. It also serves the U.S. and Europe via partners. Tanla serves enterprises, the public sector
and ISVs via an expansive set of capabilities, including basic and advanced messaging and voice,
conversational commerce, integrations, chatbots, and vertical and horizontal solutions. It also
offers messaging infrastructure products to telcos, including messaging gateways and firewalls.
To address growing fraud and privacy concerns, it has developed extensive anti-phishing, spam
detection and fraud management features.

Tanla plans to continue investing in its anti-phishing platform, vertical-specific conversational

solutions and AI-backed marketing solutions.

On 3 July 2023, Tanla closed its acquisition of ValueFirst. Any analysis during the research process
here does not reflect Tanla’s position post this acquisition. Gartner will provide additional insight
and research to clients as more detail becomes available.

Strengths
Tanla’s Wisely ATP (AI/machine learning [ML]-based anti-phishing), Trubloq (blockchain-based
spam control) and Wisely Communicate (blockchain-based platform to address data security
and privacy needs) deliver an elevated customer experience for digital interactions.

Tanla provides extensive support for advanced messaging channels, including RCS, WhatsApp,
WeChat, Telegram, LINE and Twitter DM, combined with conversational message templates for
verticalized use cases.

Tanla has a strong focus on innovation, exemplified through its use of AI-ML technologies for
spam monitoring, firewall and conversational customer experience, along with innovative
payment features.

Cautions
Tanla’s geographic distribution of revenue, direct support and operations is largely in APAC
(mainly India and Southeast Asia). Around a third of its sales come from the Middle East
(where it is expanding), Europe and North America (which it serves via partners).

A limited few referenced customers reported that they would like Tanla to improve delivery
rates for SMS.

Tanla has a dedicated in-house professional services team, but needs to scale its breadth and
depth of SI and professional service partners to provide more choice and flexibility to its
enterprise customers.

Tencent Cloud

Tencent Cloud is a Challenger in this Magic Quadrant. The China-based cloud provider is active in
areas besides CPaaS, such as infrastructure as a service (IaaS), platform as a service (PaaS),
SaaS, gaming, digital content and meetings. Tencent owns communications and social services
WeChat and WeCom (enterprise version of WeChat).

Tencent Cloud’s CPaaS platform provides a wide base of services, from basic SMS and SIP trunks,
to advanced capabilities like 5G, IoT and biometric security. These services are leveraged by
vendors for media, gaming, enterprise meetings and autonomous driving. A big part of its CPaaS
business is to power customers with its real-time video and audio services. WeCom and WeChat
platforms play a key role in e-commerce. Tencent Cloud promotes self-service with published
tools, pricing and trials for developers.

Strengths
Tencent Cloud’s platform can scale to support applications in gaming, e-commerce and
education to serve millions of customers.

Strong real-time capabilities in video streaming, audio, WebRTC, noise reduction and codecs.
Common use cases include enterprise meetings, education, gaming and social media.

Tencent Cloud is good at offering its own solutions as well as providing a platform for other
vendors to build their solutions. Example solutions include CDP, contact center, telemedicine,
and e-commerce.

Cautions
Tencent Cloud’s business is skewed to China and selected Asian markets. Politics limits the
ability to succeed in Europe and North America.

Customers referenced cite that Tencent Cloud tech support does not always respond and
resolve service issues in a timely manner.

Tencent Cloud lacks a robust marketplace with prebuilt integrations to the major cloud
application providers in CRM, contact center, ERP and electronic health records (EHRs).

Twilio

Twilio is a Leader in this Magic Quadrant. U.S.-based and publicly held, Twilio’s platform includes
a broad range of capabilities that enable programmable communications, conversational
customer experiences and omnichannel interactions for enterprises and ISV/VARs, providing high
scalability, regulatory compliance, and security and fraud management.

While a majority of customers are in North America and EMEA, Twilio has global operations. It
invests in fraud management, verification, route optimization, personalization and omnichannel
orchestration through its Segment CDP and applications like Twilio Engage. A recent
reorganization is designed to provide more dedicated R&D, sales and services support models to
different customer personas.

Strengths
Twilio offers an expansive CPaaS platform in terms of breadth and depth of functionality. This
includes programmable communications channels spanning basic and advanced messaging,
voice, video, email, security and fraud management, CDP and contact center.

Twilio delivers a rich developer ecosystem and support, including APIs, SDKs, documentation,
training programs, code samples, tutorials, developer events, blogs and a developer evangelism
team.
 The company provides a strong operational experience in terms of customer onboarding,
quality and security certifications, global customer support, platform scalability, and low
message latency.

Cautions
After a significant headcount reduction in the last year and a structural reorganization, some
customers referenced a slowdown in responses to customer support requests.

Twilio has above-average turnover in its executive ranks, which appears to have slowed down
the pace of innovation the company offered in earlier years.

Prospects of Twilio Flex contact center would prefer better guidance, best practices and more
templates in order to get started quicker.

Vonage

Vonage is a Leader in this Magic Quadrant. Based in the U.S., its Vonage Communications
Platform (VCP) provides extensive capabilities, including basic and advanced messaging and
voice, video, email, integrations, security, payments, low-code/no-code programmable
components, chatbots, and conversational commerce capabilities. With a focus on customer
support, compliance, scalability, global operations and partners, Vonage serves enterprises and
ISVs/VARs globally. Vonage plans to invest in incorporating generative AI into its platform,
expanding its anti-fraud capabilities, building global network APIs with CSPs, and enhancing local
support for regional data centers.

Vonage is a wholly owned subsidiary of publicly held Ericsson.

Strengths
Vonage is strong on its verticalization of products and services in retail, healthcare, education,
online events, social, gaming, e-commerce, financial services and insurance.

Vonage emphasizes innovation, exemplified via its AI Studio, e-commerce, multichannel

conversations, combined with Ericsson’s 5G network APIs.

Vonage has attentive customer care with a reputation for being responsive to market needs.
For instance, after hearing customers’ fraud concerns, Vonage built tools for enhanced
authentication, fraud monitoring and prevention.

Cautions
While Vonage does provide integrations with several CRM, CCaaS and ERP solutions, it lags
behind some of its peers vis-a-vis the number of integrations, especially with CCaaS systems.

Vonage’s legacy has been as a co-creator, and while it has increased its focus on developer
self-serve, Vonage should further expand efforts to attract more developers and accelerate
product-led growth (PLG).
 Some customers in non-English-speaking markets have reported that the information about
Vonage’s products and services available to them in non-English languages needs
improvement.
Inclusion and Exclusion Criteria
To qualify for inclusion in this Magic Quadrant, providers needed to fulfill all of the following
requirements:

Vendor CPaaS revenue to be $350 million or more for January to December 2022, with at least
$10 million in revenue billed in at least two of the following four regions:

North America

Latin America

Europe, Middle East and Africa

Asia/Pacific (including Japan)

Or CPaaS revenue of between $250 million to $349.99 million, with CPaaS revenue growth for
January to December 2022 of 40% (compared to the same period in 2021) and with at least
$7.5 million of billed revenue in at least two of the above-mentioned regions.

Note: Vendor revenue figures must be reported in U.S. constant currency.

Note: Vendor revenue is for CPaaS services, which are designed for developer consumption.
This includes support of such attributes as APIs, SDKs, IDEs and documentation. CPaaS
revenue excludes revenue that are “out-of-the-box,” SaaS-based solutions that tend to be for
nondeveloper roles and do not enable developer access.

Revenue for a particular region is allocated to where the CPaaS contract is signed and services
are delivered. This is typically the corporate headquarters or the regional business unit of a
multinational organization.

Vendors must have employee personnel (typically sales [direct and indirect]), marketing,
customer service/support, and engineering/R&D), along with proof of operations in the regions
in which they cite revenue (e.g., North America, LATAM, EMEA and APAC [including Japan]).
Proof of operations can include, but are not limited to, physical buildings that are cited on a
website. Proof of operations can also include local language support, support of local
currencies and billing, and website referenced customers in that particular market.

CPaaS vendors must offer the core CPaaS capabilities of APIs to:

Send and receive SMS messages.

 Place and receive voice calls.

Route voice calls via DID.

Register phone numbers (for the above-mentioned core capabilities).

Confirm identity via methods such as 2FA/MFA, flash calling, and/or silent mobile
verification.

At least one other rich communications messaging medium. For example, Apple Messages
for Business, RCS, Google Business Messages, MMS, WhatsApp or WeChat, along with
email.

CPaaS vendors must also provide customer service and support for the above-mentioned core
capabilities, including customer onboarding, technical support and usage dashboards.

Gartner required a letter of attestation from the business leader responsible for the profit or loss
of the provider’s CPaaS offering to certify that the minimum revenue requirement was met.

A broader mix of CPaaS services, in addition to the core above-mentioned capabilities, are
considered as “optional” capabilities. These include functionality such as:

APIs for a wider array of messaging channels, such as email or advanced/rich messaging
channels. Rich communications channels could include WhatsApp, WeChat, Apple Messages
for Business, MMS, RCS, Google Business Messages, email, LINE, Viber Telegram, push
notifications and other social messaging apps (e.g., Instagram Messenger, Twitter DM, Discord
or SnapChat) or rich messaging formats. These can be provided with an omnichannel and
orchestrated capability and in the form of conversational APIs. Note: Gartner is aware that
vendors may not have all rich messaging channels listed here, but as a core will need to provide
at least one for inclusion.

Advanced voice, including APIs for services such as emergency communications, call scoring,
contact center, audio conferencing, call queuing, IVR, music on hold, multimedia, speech to text,
NLP, call recording, sentiment analysis, branded calling. Additionally, there are optional basic
voice services, such as SIP trunking, LNP, calls from within apps/webpages, and phone number
authentication and anonymization.

Video, which includes programmable video APIs, such as video streaming and in-app video
service.

Advanced security and privacy, which includes voice-facial-finger biometrics, call risk scoring,
SIM verification, call/delivery analytics, call tracking, dynamic route capabilities, along with anti-
phishing and anti-spam.
 Programmable wireless, which includes E-SIMs and IoT packaged solutions and 5G-enabled
communications APIs.

Other APIs for payments or payment integrations, integration into third-party or own-grown
capabilities for CDP, CRM, AI and conversational bots on the above-mentioned channels.

Advanced support, which includes vendor marketplace, partner marketplace, visual builder,
customer success programs, customer development plans, compliances (vertical/horizontal),
developer activities (e.g., events-certifications-blogs). It also includes support for horizontal
(e.g., campaign management, lead generation, contact center, rich conversations) or vertical
use cases scenarios (e.g., telemedicine, wealth management, e-commerce).

CPaaS vendors that have a wider base of services extending into the optional CPaaS categories
will have a richer product portfolio. These related optional capabilities listed above will improve
the value of the CPaaS solution to customers and are included in Gartner’s ratings.

Gartner did not consider vendors whose offerings are predominantly focused on a specific CPaaS
service, such as video or IoT.

Inclusion in the CPaaS Magic Quadrant and our CPaaS definition does not extend to out-of-the-
box software providers in such areas as unified communications as a service (UCaaS), CCaaS,
and CRM, even if they provide APIs to manage those offerings.
Evaluation Criteria
Ability to Execute
Gartner evaluates providers on the quality and efficacy of the processes, systems, methods or
procedures that enable IT provider performance to be competitive, efficient and effective, and to
positively impact revenue, retention and reputation within Gartner’s view of the market. Ability to
Execute is judged by seven main criteria.

Table 1: Ability to Execute Evaluation Criteria

Evaluation Criteria Weighting

Product or Service High

Overall Viability High

Sales Execution/Pricing Medium

 Evaluation Criteria Weighting

Market Responsiveness/Record Low

Marketing Execution Medium

Customer Experience High

Operations Medium

Source: Gartner (September 2023)

Completeness of Vision
Gartner evaluates service providers on their ability to articulate logical statements convincingly
about the market’s current and future direction, innovations, customer needs, and competitive
forces, and on how well these correspond to Gartner’s position. Ultimately, we rate providers on
their understanding of how they can exploit market forces and how well they map to Gartner’s
view of the market.

Table 2: Completeness of Vision Evaluation Criteria

Evaluation Criteria Weighting

Market Understanding Medium

Marketing Strategy Medium

Sales Strategy Medium

Offering (Product) Strategy High

Business Model Low

 Evaluation Criteria Weighting

Vertical/Industry Strategy Medium

Innovation High

Geographic Strategy High

Source: Gartner (September 2023)

Quadrant Descriptions

Leaders
Leaders are in the strongest position to influence the market’s direction. They demonstrate a
market-defining vision of how CPaaS can be deployed on various use cases. Leaders have the
Ability to Execute against that vision through the capabilities of their organization, business model
and platform. They have demonstrated business results in the form of references and growth.
They excel in their combination of market understanding, innovation, platform features and overall
viability.

Leaders are often the vendors that other providers measure themselves against. They are suitable
vendors for most organizations to evaluate, but should not be the only vendors evaluated.

Challengers
Challengers have established presence, credibility and viability, and have demonstrated the ability
to meet customers’ expectations. Challengers often have good technology capabilities, but may
lack coverage in selected technology areas, have limited geographic coverage, or not support a
broad set of use cases.

Challengers are well-placed to succeed in the market. However, they have not demonstrated the
same thought leadership or innovation that the Leaders have. They are often a good choice for
organizations that value execution, reach and broader product offerings over vision.

Visionaries
Visionaries can deliver innovative capabilities and sophisticated CPaaS experiences, such as
vertical industry use cases or e-commerce services. These vendors embody trends that are
shaping the CPaaS market. They may have limitations in terms of brand awareness, ability to
support large customers or market sizing compared to their counterparts. Visionaries have strong
innovation and roadmaps.
Visionaries are a good choice for organizations that want innovation and are willing to work with a
less well-known vendor or smaller vendor. Visionaries that manage to add additional execution
power to their innovative platform can become Leaders. Some Visionaries are the vendors most
likely to be acquired by larger vendors.

Niche Players
Niche Players may offer selected CPaaS capabilities compelling to certain users, but their solution
set has selected limitations. They could:

Be limited in terms of proven financial success

Be limited in terms of breadth of features and functions

Possess low brand awareness

Lack presence to deliver across multiple geographies

Lack strong business execution in the market

Lack the ability to support large-enterprise requirements

Niche Players can often offer good solutions to meet the needs of a particular and well-defined
CPaaS use case or geography. When a Niche Player is a good fit, it can offer a better price-to-value
ratio or time-to-market advantage. Niche Players may struggle to win deals across multiple
regions.

Some Niche Players demonstrate a degree of vision that suggests they might become Visionaries,
but they might struggle to make this vision compelling. They may also struggle to develop a track
record of continual innovation. Other Niche Players may have the opportunity to become
Challengers if they continue to develop their platforms with a view of improving their overall
execution.
Context
This Magic Quadrant evaluates vendors that meet Gartner’s inclusion criteria for CPaaS. CIOs
seeking digital transformation, and who want to drive digital capabilities for enhanced customer
experience and operational effectiveness across applications, should use this research as part of
their market evaluation. They should align their strategy with their application leaders and
business unit teams to understand the potential use cases for CPaaS and possible outcomes,
which could have a positive impact across the organization. Although many vendors did not
qualify for this research. One size doesn’t always fit all. In addition to vendors in this report,
evaluate:

Regionally dominant vendors. Gartner analysts see different shortlists in each country. A
regionally strong vendor can be a better choice because it understands the culture, language,
 relevant regulatory compliances and your customer base requirements better than larger
worldwide vendors.
Domain specialists. For a particular domain like expansion into CCaaS or deeper integration
capabilities with CRM or specific partner vendors. They may also specialize in CPaaS APIs
associated with video, IoT or data/calendar scheduling from email or have deeper specialism in
payment and event ticketing, or chat commerce capabilities.

Industry-specific. Vendors may have a deep focus or expertise and related compliances for a
specific vertical industry. For example, in healthcare.

Vendors with specific wholesale/white glove CPaaS capabilities. For example, those that will
assist vendors or tech service providers to build their own CPaaS capabilities.

Vendors with the capabilities of larger software suites or larger software vendors that are
embracing CPaaS but it’s not all they do (i.e., Microsoft and Amazon). For use cases involving
an existing ERP or CRM system, ticketing system or something similar, the vendors of those
platforms commonly also provide elements of CPaaS which are integrated into their platform
capabilities. This might be a good choice to leverage existing relationships with familiarity of
existing offerings or with those that have a lower price point and quicker time to market.

Selecting the best-fit CPaaS vendor for your organization should factor in a number of variables.
But the initial three filters are:

Capabilities — The CPaaS market covers many different capabilities, spanning voice,
messaging, security, solutions, video, among others. Some vendors may specialize in particular
areas like voice or video. Others will offer a broader suite of capabilities. Enterprises should
therefore pursue CPaaS vendors fulfilling their requirements.

Geography served — CPaaS providers are typically strong in their home region. But they may or
may not support other regions. Look for vendors that can support you through local operations
and staffing, in addition to the strength of their partnerships (VARs, SI and delivery partners).
Preferably they can bill in your preferred currency and have local language support in each
region.

Compliances, localization and regulatory support — Buyers increasingly require CPaaS

providers to store their data local, adhere to security regulations and fulfill regulatory
requirements. This typically varies by region, vertical and use case.

Hopefully, after applying the above criteria you still have a number of CPaaS vendors who fulfill
the above filters. If not, the enterprise will likely have to split up the CPaaS contract and work with
multiple vendors.

The second set of filters tend to focus on:

 Price — Including pricing based on API usage, traffic, setup and development costs, and pricing
for any additional or customized support needs.

Platform scalability and performance — For enterprises that have a high volume of
communications and/or mission-critical use cases; metrics such as platform availability,
message latency and ability to handle projected traffic volumes are important.

Developer environment — APIs, SDKs, documentation, visual builders and certifications.

Professional service support — Some customers prefer assistance in building their CPaaS
offerings while others use their internal staff.

Many Gartner clients start with a single CPaaS vendor. However, they typically multisource when
their annual spend reaches $1 million or they need service in a different region.
Market Overview
During 2022, the market for CPaaS slowed marginally based on the previous growth expectations
and past acquisition activity. Into 2023, vendors are focusing on profitability and integrating
acquisitions.

Starting in 1Q23, CPaaS vendors began planning how they will adapt to the emergence of
generative AI and large language models. It appears that CPaaS vendors are taking a partner
approach, whereby they connect their CPaaS toolkit with leading generative AI vendors like
Microsoft, Google and Amazon. Gartner believes that the huge funding commitments to build and
maintain generative AI means that CPaaS providers’ only realistic option is to partner.

New ways of engagement have become more ingrained in enterprises. Enterprises now realize the
need to operationalize engagement with their internal stakeholders and external customers,
digitally. While foundational SMS and voice retain their dominance in the communications
channels used for CPaaS, enterprises are also focused on extending their communications
capabilities to deliver personalized and contextual experiences. WhatsApp continues to drive
forward along with other rich messaging formats. Conversational bots (both voice, chat and AI)
are becoming increasingly prevalent, and so are other communications channels (e.g., video) for
developers to build new applications or integrate and future-proof existing business systems in
use (in modular form).

CPaaS vendors have expanded their developer toolsets and enhanced their developer relations to
address growing demand, along with deepening their integration capabilities or providing their
own in areas of CCaaS, CDP, conversational artificial intelligence (CAI) and ERP. Low-code/no-
code visual builders are also available for many CPaaS functions, along with templated solutions
and emerging solutions-in-a-box to deliver relatively complex cases with simplification-enabling
agility to get up and running quickly. CPaaS vendors have also been expanding their horizontal
(e.g., campaign management and vertical (e.g., healthcare, e-commerce, banking and insurance)
use cases. Many vendors also provide the underlying messaging capability for some of the
world’s leading tech companies (e.g., SalesForce), along with driving relevant white labeled or
“powered by” solutions for other leading companies. Uber’s technology, for example, has largely
relied on CPaaS.

Through 2022 partnerships at a channel/agent level, delivery and integration levels have
deepened as CPaaS has shifted from its initial one use case to spin off in different areas of the
enterprise for different use cases (i.e., shift from marketing to customer services or HR
applications) in addition to assist enterprises serve end customers in a personalized and
contextual manner.

Pricing for basic SMS has started to increase as carriers have raised their charges. However,
pricing is based typically on a volume basis for foundational CPaaS services and has become
more complicated as additional elements have been added in, such as voice bots and chat bots.

We have also seen significant growth in the use of more advanced CPaaS initiatives from
enterprises within emerging regions. They do not have the legacy evolution of systems in place
and are now shifting to increasingly digital channels.

For enterprises, don’t base your assessment of CPaaS purely on price, but on the capabilities that
are available now to fulfill your remit, in the region and with the functionalities, such as local
support/success teams and integrations they provide. Look at the strength of delivery partners, if
required, and their capability to get up and running with CPaaS capabilities, quickly and flexibly.
Evidence
Surveys. For this year’s 2023 Magic Quadrant and last year’s 2022 Market Guide reports on
CPaaS. Gartner has looked at over 50 vendors in the CPaaS space and invited 40 of those vendors
to the prequalification survey. This prequalification survey was completed by all vendors asked
and helped form the inclusion criteria.

Client inquiries. Gartner analysts involved in this research conducted over 2,500 inquiries about
the CPaaS market over the last three years.

Vendor demonstrations and due diligence. The final set of vendors completed the Magic
Quadrant survey, typically supplied demonstrations of their platform and showed use cases that
covered the major capabilities. In addition, Gartner collected feedback from vendor client
references, and relied on secondary sources and inquiry to complete the data gathering.

Evaluation Criteria Definitions

Ability to Execute
Product/Service: Core goods and services offered by the vendor for the defined market. This
includes current product/service capabilities, quality, feature sets, skills and so on, whether
offered natively or through OEM agreements/partnerships as defined in the market definition and
detailed in the subcriteria.

Overall Viability: Viability includes an assessment of the overall organization's financial health, the
financial and practical success of the business unit, and the likelihood that the individual business
unit will continue investing in the product, will continue offering the product and will advance the
state of the art within the organization's portfolio of products.

Sales Execution/Pricing: The vendor's capabilities in all presales activities and the structure that
supports them. This includes deal management, pricing and negotiation, presales support, and
the overall effectiveness of the sales channel.

Market Responsiveness/Record: Ability to respond, change direction, be flexible and achieve

competitive success as opportunities develop, competitors act, customer needs evolve and
market dynamics change. This criterion also considers the vendor's history of responsiveness.

Marketing Execution: The clarity, quality, creativity and efficacy of programs designed to deliver
the organization's message to influence the market, promote the brand and business, increase
awareness of the products, and establish a positive identification with the product/brand and
organization in the minds of buyers. This "mind share" can be driven by a combination of publicity,
promotional initiatives, thought leadership, word of mouth and sales activities.

Customer Experience: Relationships, products and services/programs that enable clients to be

successful with the products evaluated. Specifically, this includes the ways customers receive
technical support or account support. This can also include ancillary tools, customer support
programs (and the quality thereof), availability of user groups, service-level agreements and so on.

Operations: The ability of the organization to meet its goals and commitments. Factors include
the quality of the organizational structure, including skills, experiences, programs, systems and
other vehicles that enable the organization to operate effectively and efficiently on an ongoing
basis.

Completeness of Vision
Market Understanding: Ability of the vendor to understand buyers' wants and needs and to
translate those into products and services. Vendors that show the highest degree of vision listen
to and understand buyers' wants and needs, and can shape or enhance those with their added
vision.

Marketing Strategy: A clear, differentiated set of messages consistently communicated

throughout the organization and externalized through the website, advertising, customer
programs and positioning statements.

Sales Strategy: The strategy for selling products that uses the appropriate network of direct and
indirect sales, marketing, service, and communication affiliates that extend the scope and depth
of market reach, skills, expertise, technologies, services and the customer base.

Offering (Product) Strategy: The vendor's approach to product development and delivery that
emphasizes differentiation, functionality, methodology and feature sets as they map to current
and future requirements.

Business Model: The soundness and logic of the vendor's underlying business proposition.
 Vertical/Industry Strategy: The vendor's strategy to direct resources, skills and offerings to meet
the specific needs of individual market segments, including vertical markets.

Innovation: Direct, related, complementary and synergistic layouts of resources, expertise or

capital for investment, consolidation, defensive or pre-emptive purposes.

Geographic Strategy: The vendor's strategy to direct resources, skills and offerings to meet the
specific needs of geographies outside the "home" or native geography, either directly or through
partners, channels and subsidiaries as appropriate for that geography and market.

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