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Apps with a Voice

Comcast bribed me into purchasing phone service from them. I was already paying for Internet, and they made the voice bundle attractive. Was it because they could get more revenue from a single account or because the services individually are overpriced? We may never know. When a company offers all of the components, there's logic to bundling. One customer, one invoice, more revenue.

Bundling is a common practice, but it doesn't always involve components from the same firm. That's when things get tricky because the value proposition and prices are more transparent. Historically, voice was a separate purchase from applications, but that might be changing. Voice as a stand-alone service is a commodity, but when voice and applications are tightly integrated, the value can be extraordinary.

The voice playbook got revised a few years back to include applications--unified messaging, contact center, recording, etc. Now the playbook is becoming more vertical--CRM, Office productivity, ERP, etc. Think click-to-dial, appointment reminders, and other forms of integrated notifications. It's not new because APIs have offered this, but integrated applications have broader appeal.

Integrated solutions trump bundles and are the way forward. The term extensibility was introduced to the UC lexicon years ago. Initially, its primary purpose was to allow third parties the opportunity to make complementary applications. But rather than each application strengthening the voice proposition, it is now going the other direction--that is, voice and communications strengthen the value of business applications.

A typical medical office has a server/service for practice management and a communications platform. What if the medical office only had to acquire a practice management system that met all of the office's telecom needs?

Integrated communications services including phones and the ability to.receive calls (with screen pops) could enable the office to call and text patients with appointment reminders and lab results, and offer built-in prescription services (refills and pharmacy inquiries), etc. It would also include on-the-go smartphone clients for on-call alerts with remote/mobile access to medical records. The in-office tablets would also be able to make and receive voice/video calls, texts/IMs, and notifications--the same tablet that gets used for viewing X-rays and labs, prescribing meds, taking notes, capturing vitals, and just about everything else.

All this integration and value will come from the app provider, not the "comms" provider, and it's going to happen to a vertical near you. "Provider" may indeed be the right word, as the whole package will likely be offered as a service. Today the integrations exist, but they are complicated. We are moving past solutions that can be integrated into business apps, to business applications that offer integrated communications.

Dreamforce, the annual conference hosted by, talks a lot about integrating communications. At Dreamforce 2012, CEO Marc Benioff demonstrated the use of consumer video technology on a smartphone utilized by a helpdesk to A) solve a problem and B) build customer loyalty. He was pretty light on the underlying technical details, but captured the vision well.

Yet the reality is that those technical details are significant and a barrier for most firms. It isn't that it's impossible, but it may be too difficult. APIs and partners make a lot of sense, but there's no control over the customer experience.

Tim Panton recently posted, "The telcos haven't got used to their new role in the world--or even worked out what it is. To get a feel for the degree of failure to grasp the chance, look up the market capitalization of a European telco as compared to (say) Google. 6 years ago Orange was the same size as Google. Now it's a tenth the size."

We tore down the PBX silo with UC, which was flatter and broader but still a silo. The next round will finally squash the silo notion and business applications will include communications. This is what Microsoft is doing with Lync and its own apps. Those are general purpose and broad apps. The same is happening with Google Apps. There's an even bigger opportunity with specialized vertical apps like MRP, Medical apps, Legal apps, and more.

The painful reality is the voice dog is becoming increasingly bad at hunting. It's going to be much easier to attract and close leads with comms-enabled business applications than to sell comms as a stand-alone solution (or platform).

The kicker is that the comms part will be the most lucrative aspect of the solution. Business apps are extremely competitive, so the profit will be in the add-ons (like UC)--plus, comms will make the accounts more sticky with recurring revenue. The characteristics of the comms channel that are driving commoditization will become the desirable aspects of the app model.

Major apps, like Salesforce, won't move away from generic integrations, but are likely to offer natively integrated comms capabilities. End users don't want to be responsible for the integration burden anymore, so it's up to the vendors, providers, and channel. This is why ShoreTel was highly visible at Dreamforce, and why Avaya made a strong appearance at Oracle World. More recently a very large Google Apps reseller and a very large BroadSoft hosted UC provider merged.

PC sales are down. The future of hard phones is unclear. Voice is increasingly seen as a commodity, Hardware is a four letter word (call it hrdw). Where is a telecom provider or vendor to hang its hat? The apps! The survivors will be those that offer comms-enabled, complete solutions around ERP, HRIS, messaging, CRM or really anything that is driving business.

Dave Michels is a Contributing Editor and Analyst at TalkingPointz

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