by Jim Lundy
(Aragon Research) – Yesterday at Avaya ENGAGE®, Avaya’s annual customer conference held this year in New Orleans, Avaya announced that it was acquiring Seattle-based Spoken Communications, a cloud contact center provider.
This blog summarizes some of the key findings of the deal and the impact on Avaya and its customers.
Avaya and Spoken Communications: A Roadmap to the Cloud
Avaya has always been known for its on-premise voice and contact center solutions; now, it has a roadmap for its customers to go to the cloud, enabled by its Spoken Communications deal. Spoken Communications has 170 patents and patent applications on file.
While the full terms were not disclosed, the deal is being funded with cash and is expected to close quickly. Spoken Communications will become one of the primary cloud offers in the new Avaya Cloud business unit, which is run by new SVP Mercer Rowe, who joined Avaya in January 2018.
Content Analytics and Voice: The Secret Sauce Avaya Is Getting from Spoken Communications
SVP of Product and Solutions Laurent Philonenko shared yesterday that the main reason for buying Spoken was its technology. Some of the technology that Avaya will leverage in deals includes real-time speech-to-text conversion and advanced voice analytics.
Part of the deal is a subsidiary of Spoken called Hyperquality, which we expect will provide more embedded analytics that Avaya plans to leverage. It will also include another unit called Intelligent Wire for more focus on Natural Language Processing (NLP) and Artificial Intelligence. The overall focus on AI will put other contact center providers who partner for analytics on notice.
Deal Is New, But the Customer Buzz Was Evident
While this deal was just inked, the buzz at Avaya ENGAGE® was noticeable. Avaya has been under attack by other cloud contact center providers, such as Five9. Having Spoken Communications now provides a roadmap for current customers and this should allow Avaya to solidify its base and eventually upgrade them to a cloud solution.
The Launch of the Avaya Ava Chatbot
In addition to Spoken Communications, Avaya announced a new AI chatbot, Avaya Ava, which will support 34 languages and will leverage AI capabilities from partners, such as IBM. Avaya didn’t provide too many other details, other than it would run in multiple mobile messaging platforms such as Facebook and WeChat.
Move Into Cloud Is Late, But Not Too Late
Avaya has had hosted offerings, but wasn’t saying cloud in an aggressive manner until this week. Mercer Rowe is only a few weeks into his job as head of Avaya Cloud, but it was clear that Avaya gets it that it needs to do more in cloud. Spoken is a good first move and Avaya Ava puts Avaya right into the chatbot battle.
Avaya Management Team Is Focused
At the event, Avaya trotted out its new management team, which includes experienced sales leaders: Jim Chirico, CEO; Jim Geary, Head of North American Sales; Laurent Philonenko (formerly of Cisco), an experienced product and solutions leader; Mercer Rowe, a new cloud business leader; and Patrick O’Malley, a new CFO.
As a note, I have known Laurent Philonenko for years and he delivered products at Cisco; now, he’s building a solid team at Avaya. Avaya’s high quality video capabilities were a little overlooked but can compete with any vendor on the market. We expect to see even more from Laurent and his team as they drive updated and new products, such as Ava and Spoken, into the market.
Avaya Is Now Public
In addition to the deal, Avaya is now out of bankruptcy and is publicly traded on the New York Stock Exchange. With a clean balance sheet, we expect customer erosion to be mitigated.
This “new” Avaya that is now unleashed will be able to compete in all aspects of Unified Communications and Collaboration. Look out for the second annual Aragon Research GlobeTM for UCC, coming next month.