Last week the analyst team from Cavell Group attended Enterprise Connect in Orlando for a packed 3 days of meetings and updates from the UC and CC industries. Here are some of the key takeaways from this event.
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AI was the event’s key theme
To the point where it was (almost) getting a bit too much. Every single meeting Cavell Group had with leading vendors and providers included AI, either as a platform update or on the future roadmap. Ever since the transformative impact of OpenAI’s ChatGTP on consumers and businesses alike, most vendors have re-oriented their strategies to reflect Microsoft’s lead in this field. Webex, Zoom and RingCentral all announced AI updates to their platforms, with RingCentral releasing RingSense for Sales, a whole new solution built around AI.
Microsoft is introducing Copilot to the Microsoft 365 Suite including Teams chat, which will enhance the meeting experience with summaries, action points, sentiment analysis, and many other insights. It is still very early days for Copilot, Microsoft still hasn’t completed its internal rollout and it’s currently only in testing with 20 large enterprises. The announcement still leaves some key questions unanswered: when can I have it and – maybe more relevantly – how much will it cost? The addition of Copilot is likely to be a chargeable add-on across the wider Office 365 suite, but this has not been confirmed by Microsoft, nor has its general availability.
CCaaS vendors have also jumped on the bandwagon, with Five9 announcing agent assist using ChatGTP and AI Insights which is set to come later on this year; and UJET is also leveraging its relationship with Google to deliver new experiences with AI.
With these new updates coming all at once it does beg the question if AI would have been a focal point for UC and CC vendors pre-ChatGTP. Microsoft’s collaboration with OpenAI does seem to have spurred the industry following ChatGPT’s widespread consumer and enterprise adoption in early 2023. We wonder how many marketing teams were scrambling pre-event to ensure they had an AI related announcement to make at the show.
The ensuing discourse around AI, unlike other emegring technolgies, has now transitioned away from being a nice-to-have feature into a useful, everyday enhancement to collaboration. This point is key. Artificial intelligence and machine learning aren’t new phrases for the communications bingo card. They have both been around for quite some time but, often their tangibility has been more nuanced where they have been subtly behind the scenes, often as part of contact centre solutions. Now, the capability is there for all to see and to apply the potential to their own workflows, making the impact much more profound. Most of the example use cases were centred around knowledge workers, so how relevant Copilot will be for Microsoft’s frontline worker target is yet to be determined.
Interoperability and integrations key for future platform vendors
Most surprisingly, both Cisco and Microsoft’s keynotes included each other interacting – slightly awkwardly – on Cisco’s devices that are now natively integrated with Microsoft Teams. While on stage Ilya Bukshteyn, VP of Calling and Devices at Microsoft, called Snorre Kjesbu, SVP of Collaboration Devices at Cisco, who then reciprocated in turn once he was up. Bukshteyn went so far as to describe their relationship as a ‘fantastic partnership’, and indeed they have accomplished a lot so far with several Cisco devices being Microsoft Teams certified and more in beta for MTR (Microsoft Teams Rooms). A few weeks ago, it was also announced that Cisco’s contact centre is now certified for use with Microsoft Teams.
It appears that Cisco has realised that Microsoft Teams is, and will continue to be, the dominant collaboration player in the UC space and that integrating with its own platforms is a core way for Cisco to continue to add value. Despite Webex Calling reaching 10 million seats, Microsoft Teams still has the largest telephony enablement market share, mainly through Direct Routing and Operator Connect. This collaboration between Microsoft and Cisco isn’t new, veterans of the industry will recall previous similar endeavours that did not last. However, this announcement does epitomize a wider trend. More and more vendors are realising they must work within, and alongside, the Microsoft eco-system to ensure access to a growing user market. Both 8×8 and RingCentral have increased their efforts with a wide range of telephony solutions specifically for use with Microsoft Teams. Smaller vendors have followed suit and a Microsoft partnership strategy seems to be vital for everyone involved in communications now.
Microsoft’s partnership with Cisco will clearly benefit Microsoft who only play a minor role in the devices arena, outside of gaming, and can now expand its target market and reach. However, the overall message is clear: siloed platforms are not the way forward and all major vendors and platforms will have to work more and more closely to stay relevant. The future is looking set to be vendor-agnostic, or maybe formed by a smaller number of key players all interoperating with each other to serve specific verticals and enterprises.
Contact centre and customer engagement is the future of UC
The convergence of UC and CC has long been a trend in the industry, but it has now well and truly become the reality for UC providers and vendors. Almost half of the meetings Cavell Group had at Enterprise Connect were with CX and CC providers, and practically all the meetings had some mention and coverage of customer engagement and experience trends. The improvement of agent and employee experience, as well as the need to differentiate, is driving significant innovation in this area. Contact centre providers are looking at innovating their portfolios and finding their niche in an increasingly saturated market. Most UC vendors are now offering a competitive contact centre portfolio with various levels of AI innovation and integrations into leading SaaS applications such as Salesforce and other data management platforms.
The opportunity CX related solutions provide is already being noted by Cavell’s service provider and telco customers. With traditional revenue and margin streams being squeezed, and competition increasing, providers are looking to peripheral areas to add value, an obvious area seems to be contact centre. Although, in actuality this can be a lot more challenging for service provider with traditional voice expertise. The complexity and customisation requirements of contact centres – couple with the often radically different buyer persona – often prove extremely for providers to overcome.
The opportunity of integrating with Microsoft Teams in particular appears to be a keyway providers can look to gain value in this market as this is a recognised weakness in the Teams portfolio. Currently Microsoft’s only internal offering, Dynamics 365, has not gained huge traction and Microsoft is relying on its growing list of certified contact centre partners to ensure its viability for those enterprises with contact centre integration requirements.
In comparison to the amount of time dedicated to AI and CX, the conversation around collaboration and telephony was surprisingly minimal; for instance, Cisco’s keynote was mainly dedicated to its device portfolio and its integrations with Microsoft Teams, and while it did announce Webex Calling had reached 10 million seats, this was not the main message of the session. To reflect this new trend and area of focus from the industry, Cavell Group is widening its research topics this year to cover these emerging trends. This includes widening our contact centre research programme and including market data and sizing in this area for the first time.
Frontline workers will be a key vertical
Many of the major vendors have previously mentioned how frontline workers are a key area of future growth, though so far there has been little provision to target this new potential available market. However, RingCentral in particular dedicated a significant proportion of their keynote to developing solutions for frontline workers with a new ‘RingCentral for Frontline Workers’ portfolio. This includes the launch of Push to Talk, a solution that turns employee or company-owned devices into walkie-talkie-esque devices using Wi-Fi or mobile internet connectivity, with the possibility for video escalation as well. This will be generally available in summer 2023 and is specifically targeting those on-the-ground manufacturing and retail use cases where quick communication without bulky devices is a key requirement.
Microsoft also sees the frontline worker segment as key battleground for growth, and additional features for Teams should see greater traction in this area. A new version of the Microsoft Teams app will also be rolled out to all users, in theory by the end of next year, reducing local memory and processing requirements whilst improving performance which should also improve its usability in this segment.
The potential of frontline workers using more modern and digital tools will be a core new area of growth and relevance for vendors and providers alike. Traditionally the industry has catered more for knowledge workers who formulate vast majority of collaboration platform users today. However, as penetration grows, providers will be able to leverage the wide available market by tackling these specific use cases. Microsoft has identified future growth to come from this space, and RingCentral are already dedicating time and energy to this field. Cavell Group expect this to be a key emerging trend for UC and CC providers as the market matures and competition becomes more intense.
Cavell met with over 30 different vendors and service providers throughout the days that we were there and were impressed with the innovation that they were bringing to the industry. As well as learning more about what they were doing, it was a great opportunity to deliver some of our insights in-person to our customers who we do not see on a regular basis and we had great feedback on our latest generation research and channel insights. Many of the conversations that Cavell had were related to the contact centre and customer experience industry of which myself and Patrick Watson will be launching our latest research this quarter.