Major CPaaS players are struggling financially, which will threaten their capacity to invest in new areas
The application-to-person (A2P) and communication platform-as-a-service (CPaaS) market has grown rapidly for several years, partly thanks to the COVID-19 pandemic. However, this growth slowed in 2023 due to a weak global economy and high interest rates. Indeed, Twilio and Sinch, the two largest public CPaaS businesses, had a combined revenue that grew at a CAGR of 56% between 2017 and 2022, but only 5% year-on-year in 2023.
Revenue growth for CPaaS companies will come from investment in new areas. However, key players such as Twilio have cut their research and development (R&D) spending to help to minimise losses, thereby making it more challenging to develop new revenue streams.
Analysys Mason’s Application-to-person vendor tracker providers further details on individual players’ revenue, metrics including the number of messages delivered and merger and acquisition activity in the A2P and CPaaS markets.
Author
Ben Taylor
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