What Is CPaaS? Understanding Communications Platform as a Service
This article is part of a larger series on VoIP.
CPaaS, which stands for communications platform as a service, is a cloud-based tool that allows businesses to add real-time communications features to existing business applications. These features include voice, messaging, email, fax, and video. With these customization capabilities, organizations offer a better user experience for customers and employees alike.
How CPaaS Works
A CPaaS platform provides a complete development framework, removing the need and hassle for businesses to build their own. In this ready-made environment, you’ll find software tools, pre-built applications, code samples, and application programming interfaces (APIs), which help customize communication features and channels.
The APIs, which are at the core of CPaaS models, are programming codes that facilitate data transmission between one software product to another via voice-over- internet-protocol (VoIP) network. Think of them as mediators between apps, augmenting the communications capabilities of the application.
An example of API is SMS API, which allows an app to send messages such as alerts and autoresponders, marketing promotions, or appointment reminders to customers. Twilio, a CPaaS provider, offers two types of SMS APIs: programmable and conversations. Programmable SMS allows businesses to broadcast different kinds of messages to over 180 countries, while conversations API enables two-way engagement over SMS.
Benefits of CPaaS Solutions
Overall, a CPaaS solution improves how you communicate with customers and team members. Since communication is at the heart of business operations, this enabling technology benefits other aspects of the business, including cost and growth management. Here are the specific advantages of adopting CPaaS models:
Tailor-fitted Communications Platforms
The main benefit of adopting a CPaaS model is customization. Unlike a unified communications tool, which integrates all capabilities in one platform—messaging, voice, chat, and video—CPaaS lets you cherry-pick features. Perhaps you need an SMS and chat feature on your app, but not voice and video. With CPaaS, you have greater control over which features to have on your business platform.
A CPaaS model lets you add more communication features as your business grows. With a development framework already available and comprehensive documentation to follow, it’s easy to build additional communication channels according to your needs. In the same way, you’re able to remove a feature you no longer use and quickly adapt to the changes happening in your business.
Given CPaaS solutions’ flexibility, businesses benefit from optimized costs—saving more money in the long run as you only pay for the communication features you need. Moreover, since these solutions come with APIs and software development kits (SDKs), you won’t have to build features from scratch and pay more for development.
The pricing model of most CPaaS providers contributes to optimized costs. Vendors like Vonage, for instance, use a pay-as-you-go pricing scheme, charging businesses only for the messages or calls sent or received. For the virtual and toll-free number, it costs 0.60 cents to send a message and 0.55 cents to receive one.
Improved Customer Service
A CPaaS solution makes real-time communication with customers possible. Your clients don’t have to go to your Contact Us page, fill out the form, and wait for a couple of days to receive answers to their queries. With in-app messaging or voice API, customers instantly connect with a company representative or agent. With frictionless customer service, clients leave your platform satisfied and are more likely to do business with you.
Enhanced Data Security
Small businesses that store the personal information of customers and employees must be proactive in preventing data breaches. Fortunately, when you use CPaaS solutions, you benefit from the provider’s network security. Most vendors like RingCentral have end-to-end encryption (E2EE), third-party security certifications like ISO 27001, and user verification through two-factor authentication systems as security protocols.
CPaaS Features to Consider
The features provided in CPaaS solutions enable quick and straightforward development of communication capabilities. These are the common tools you’ll find in CPaaS products:
Communication APIs are the backbone of CPaaS systems, enabling different communication capabilities to be embedded into an app or website. These are some of the common APIs small businesses use:
- Voice API: This typically features calling capabilities you’ll find in business phone systems. They include call routing, call forwarding, call recording, audio conferencing, call reporting, interactive voice response (IVR), and answering machine detection.
- SMS API: Used for automated marketing messages, alerts and notifications, and autoresponders, this API typically features message queueing, long message concatenation, and character set support.
- Messaging API: This covers messaging on the web, social media, and apps. Maximize this to handle order or shipping updates and confirmations, product upselling, and customer polls and surveys.
- Verification API: This will be in the form of cross-channel two-factor authentication, account login attempt push notifications, or verification codes.
- Video API: Different providers will have different limits on the number of participants. For instance, RingCentral has a cap of 200 users for video meetings. The API enables access to meetings via browsers through webRTC technology. This removes the need for a downloaded app.
- Email API: Use this for sending automated messages such as account creation, shipping notifications, or password recovery. Maximize it for marketing emails such as monthly newsletters and product recommendations. Email APIs allow you to create custom triggers to send the right messages to your audience at the right time.
Most CPaaS providers have visual editors that help you build communication features such as SMS surveys, IVR, and call forwarding, even without technical expertise. These editors have drag-and-drop interfaces, making them easy to use for those with no coding background. A popular CPaaS provider, Vonage, has this kind of design studio that makes it easy to create IVR systems.
Most CPaaS solutions support common programming languages, namely:
Reporting & Analytics
To keep track of user interactions, CPaaS solutions provide access to historical and real-time reports. The platforms feature dashboards, where you see what’s happening in each communication channel.
The data presented in these dashboards are organized visually, in graphs, charts, or tables, for easy reference. They provide information that helps businesses evaluate key performance indicators (KPIs).
For instance, for voice API, the typical data points are the total number of calls, call duration, and disconnect reason. For messaging, you’ll find the total number of messages, the number of messages sent, and the number of messages received. Draw actionable steps in improving communications with these data points.
Service Level Agreement (SLA) Guaranteed Uptime
To measure service reliability, CPaaS providers offer service level agreements (SLA) that commit to a certain minimum percentage of uptime. This is a critical consideration for small businesses, especially because you want to provide uninterrupted services for customers.
The gold standard for SLA uptime is 99.999% availability, which translates to just 78 seconds of downtime per quarter. The five nines can weather sudden surges prompted by different factors, including holidays or crises.
CPaaS Providers to Consider
While all CPaaS solutions will provide the features mentioned above, providers will differ in the range of communication APIs and programming languages, as well as the quality of documentation. Before adopting this technology in your business, be familiar with what each provider offers. Here are some of the top vendors worth considering:
SLA Guaranteed Uptime
SMS, MMS, voice, fax, team messaging, video, meetings, data, analytics, and configuration
RingCentral MVP Premium: $44.99 per user, paid monthly
Ringcentral MVP Ultimate: $59.99 per user, paid monthly
SMS, MMS, WhatsApp, Facebook Messenger, Viber, voice, video, and two-factor authentication
SMS: 0.60 cents to send a message and 0.55 cents to receive a message
Voice: 0.39 cents per minute to make and receive a domestic call
AI Studio (conversational AI platform)
Node.js, Java, .NET, PHP, Python, and Ruby
SMS, voice, video, chat apps, verification, number masking, voice IVR, number lookup, and automation
SMS: 1 cent to send a message
Voice: custom pricing
Node.js, Java, Python, Go, PHP, and .NET
Messaging, voice, video, fax, email, live streaming, and WhatsApp
Voice (local): 1.3 cents per minute to make a call; 0.85 cents per minute to receive a call
Messaging (local): 0.79 cents to send a message; 0.75 cents to receive a message
Studio application builder
PHP, Python, Ruby, .NET, Java, Apex, and C#
To explore more options, check out this list of the best CPaaS providers.
Frequently Asked Questions (FAQs)
What’s the difference between CPaaS & UCaaS?
UCaaS is a ready-built platform that integrates multiple communication features. CPaaS is a customization tool featuring APIs and SDKs that add communication capabilities to existing apps and websites. Think of UCaaS as an off-the-shelf software package, while CPaaS creates tailor-made features. To know more about these two cloud-based technologies, check out our UCaaS vs CPaaS guide.
How much do CPaaS solutions cost?
Most CPaaS providers follow a pay-as-you-go pricing scheme. The cost will then depend on usage and the type of communication service you’re using. In general, however, voice API costs from 0.20 to 1.5 cents per minute for inbound and outbound calls.
How big is the CPaaS market?
The rapid growth of this niche market is among the biggest CPaaS market trends in 2022. According to Gartner, 90% of organizations will adopt CPaaS solutions within the next year. Healthcare, marketing, retail, and customer service particularly benefit from the technology, as it helps improve patient communications, offers real-time delivery and shipping updates, and creates omnichannel customer experiences.
CPaaS is an excellent solution for small businesses requiring a customized platform for their communication needs. Enhance the capabilities of your existing applications with this technology and reap the benefits of optimized costs, improved customer service, and enhanced data security.