How Genesys (And Others) Get Away With Offering Cloud Services
For now, vendors are targeting the low end of the cloud services market, to avoid competing with their carrier customers. But friction may already be developing.
Genesys, with today's announcement of Genesys Connect for Service Cloud and a new Cloud Business Unit to support it, is the latest developer of mainly on-premise solutions to branch out into the market for cloud services. Until now, Genesys's cloud strategy centered around providing its carrier partners with platforms on which they can build hosted contact center services of their own.
This is a tried and true business model for a company like Genesys. Genesys already sells contact center solutions that enterprises deploy on premise, so it's not a stretch that with a certain amount of tweaking a similar solution can be sold to service providers as the basis for their hosted contact center services.
This is the route that Cisco took years ago with its Hosted Unified Communications Solution and more recently with the Hosted Collaboration Solution (HCS) that replaced it. Service providers--20 of them according to Cisco, with 14 more to soon follow--have launched hosted UC services based on HCS. Earlier this year, with the version 8.6.2 software update, Cisco introduced long awaited contact center capabilities to HCS, turning it into a platform for hosted UC services, and for hosted contact center services as well. I'm told TeleTech is one of three service providers now offering HCS-based hosted contact center services...although the names of the other two have not been released as far as I know...and I'm not actually seeing reference to a hosted contact center on the TeleTech website.
In the case of Genesys, 25 service providers have signed up to offer hosted contact center services based on the hosted version of its contact center platform. These providers include Echopass, KDDI in Japan, ProtoCall in the UK, and most recently Deutsche Telekom. But Genesys, like an increasing number of other solutions developers, does not seem to be content relying solely on its service provider partners to build and deploy cloud-based services. It is ready to also offer a cloud-based service of its own.
How does Genesys get away with this without competing directly against the very service providers that buy the Genesys platform to offer services of their own? To answer, let's look at how other UC solution developers have seem to be getting away with it.
Cisco is a developer of UC solutions that its enterprise customers deploy on-premise and its service provider customers deploy in their networks. But Cisco recently introduced a cloud-based service that when I last blogged about it was called Callway but has since been rebranded WebEx Telepresence. (I'm not crazy about the new name, by the way, since the service is not on a technical level related to either Cisco WebEx or Cisco TelePresence...at least in the highfalutin, immersive sense of Cisco TelePresence.)
So on the one hand Cisco sells video conferencing technology that service providers, like Tata for instance, use to build hosted telepresence services. And on the other hand Cisco offers a hosted telepresence service of its own. Ostensibly Cisco avoids direct competition with Tata and other of its service provider customers by greatly limiting the scope of its hosted service offering. WebEx Telepresence is targeted at SMBs mainly looking for a desktop video conferencing service, whereas Cisco's service provider partners offering telepresence on a hosted basis are delivering the full immersive telepresence experience to large enterprises. So WebEx Telepresence should, at least in theory, kind of fly under service providers' radar.
It's a somewhat similar story with Avaya's (second) foray into cloud-based services. Avaya doesn't sell a hosted platform to service providers, though it has in the past. So the introduction of AvayaLive Connect doesn't directly compete with carrier customers that might want to one day build services on Avaya technology. But Avaya nonetheless flies under carriers' radar by offering a hosted UC service to very small businesses that major telcos tend not to target with hosted UC services of their own. Siemens Enterprise, Mitel, Interactive Intelligence, Microsoft, and a few others that I lump into the increasingly inapt "solution developer" category also offer cloud-based services of their own--but I've strayed long enough from Genesys, which is really what I planned this blog to be about.
Genesys is now also preparing its own cloud service with this week's introduction of Genesys Connect for Service Cloud. (Despite Forbes characterizing it as just an app.) Genesys Connect for Service Cloud requires businesses to deploy no contact center systems on-premise since all Genesys technology will be hosted in the cloud. It's voice only for now, with multichannel on the roadmap. The service is currently in beta, with general availability in North America slated for early 2013.
So, once again, how does Genesys get away with this without competing directly against the very service providers that buy the Genesys hosted platform to offer services of their own? Well, as with Avaya's and Cisco's cloud services, Genesys is targeting a small subset of the total addressable market for cloud-based contact center services.
As the name suggests, Genesys Connect for Service Cloud is to be sold specifically to customers of Salesforce.com's Service Cloud. Service Cloud already provides customers with a "call center-like view," in the words of the all-knowing Wikipedia, of customer interactions, without actually delivering formal contact center capabilities. The new cloud-based Genesys Connect service integrates with the cloud-based Service Cloud to deliver the contact center functionality that the latter lacks. So long as the route to market for Genesys Connect for Cloud Connect is via Salesforce's Service Cloud, Genesys is in little danger of competing directly with its carrier customers offering cloud-based contact center services of their own.
At least that's the idea. I have spoken with a few carriers that are taking umbrage at their UC and contact center technology suppliers dabbling in cloud services, even with a limited scope. They could become even more concerned if UC and contact center solution vendors expand their cloud-based services to address a larger portion of the market. If...probably when...that happens, we'll need to reassess whether vendors can continue to dance with carriers on whose feet they're beginning to tread.
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