Insider

Insider Report July 2021

August 02, 2021 by Dave Michels

The Most Important Enterprise Communications News from July 2021

July was a relatively quiet month. Other than the fact that the planet is on fire and a predictable variant of a virus poses an existential threat to humankind or at least modern society. From an enterprise comms perspective, it’s been relatively quiet. Perhaps the vendors are holding their news for EC21.

Or perhaps it just seemed quiet after the gigantic news broke that Zoom will acquire Five9. At $14.7B, the Zoom-Five9 deal is 10x bigger than what Genesys paid for Interactive Intelligence in 2016. Avaya paid a mere $900M for Nortel parts back in 2009. It’s a risky move for Zoom. Acquisitions are difficult, and Zoom doesn’t have much experience with them. But Zoom isn’t easily intimidated by long odds.

Did the Pandemic End? It’s hard to say. On the one hand, restaurants and schools are opening, employees are returning to work, and governors are ending COVID-19 relief efforts. On the other hand, employers are extending WFH, the CDC says masks are back, and cases are increasing. Delta, the variant du jour, accounts for the majority of new infections. There’s no indication the pandemic will end. Instead, we can count on more variants, and likely more vaccinations, and more resistance.

This past May, when the CDC issued guidance that fully vaccinated people no longer needed to wear masks, cases were trending downward. In June/July, I traveled to Vegas, Miami, and Europe, which swiftly reminded me why travel sucks. And, while generally tolerant of the “shit happens” mindset, I’ve become intolerant of bad customer service. It is indeed the CX experience that creates anger and ends loyalty.

The ongoing pandemic significantly complicates the brief optimism around post-pandemic anything. The UCC industry was getting excited about hybrid offices, but the return-to-office vibe is fading entirely. The future of work is less about physical places and more about changes in behaviors, processes, and attitudes. The near-term opportunity is to help organizations grapple with distributed work as a strategy rather than temporary inconvenience. Slack has been broadcasting these types of conversations over multiple channels. Check out its Future of Work blog.

According to a survey from Snow Software, just 34% of IT leaders said supporting hybrid work is their top priority. Instead, they’re focused on growth initiatives (57%), reducing or optimizing IT costs (55%), managing digital transformation initiatives (54%), and accelerating cloud adoption and migration (48%).

That said, there are some obvious contributions from the UCC sector that make sense for hybrid work models. I expect to see ongoing demand for meeting services and associated hardware, cloud migrations to UCaaS and CCaaS, virtual receptionists, and solutions for multipurpose/shared space, such as room panels and hotdesking. Also anything that facilitates or measures productivity across distributed teams.

Natural Disasters: It’s been a difficult month for the planet. July was filled with “natural disasters,” including fires, floods, flash floods, tornadoes, mudslides, fire tornadoes, hail, buckling roads, sandstorms, heat domes, and drought. The weather has become another cause of widespread death and suffering. This isn’t limited to the elderly; an Olympic athlete collapsed during the heatwave in Tokyo. Nor are we talking about minor new heat records: The Pacific Northwest in the US broke heat records by 4-5 degrees for consecutive days.

The climate change folks that have predicted this for decades also think it’s going to get worse. In addition to widespread implications to our health, food supply, and survival, it also sets the stage for another conversation about the future of work.

Specifically, organizations will need to become distributed for operational resilience, and the home vs. office conversation also changes. It will move beyond convenience and productivity to include services such as diverse high-speed connectivity and HVAC. Air conditioning may end up attracting more employees back to the office than free lunches and massages.

General Industry News

Kaseya and Security: The very IT firms hired to protect company data inadvertently provided a back door for a major “supply chain” ransomware attack this month. It hits close to home as Kaseya is used by many providers that offer UCC solutions.

It was similar to the recent SolarWinds attack, which also infiltrated the very customers that were paying for security. This new attack exploited a flaw in Kaseya’s on-premise VSA remote monitoring and management tool. Kaseya was aware of the vulnerability but didn’t fix it in time. Hackers encrypted systems and destroyed backups of thousands of companies.

Victims of the attack span 17 countries. It even impacted companies that had nothing to do with Kaseya. For example, Swedish supermarket chain Coop shut down hundreds of stores because its registers were managed by a company that’s a Kaseya customer.

We are coming to an uncomfortable conclusion: There’s simply no way to secure connected devices. The internet was great while it lasted. This conclusion became even more evident as we learned about the Pegasus attacks. This is very specialized (and expensive) commercially developed malware:

Pegasus can collect emails, call records, social media posts, user passwords, contact lists, pictures, videos, sound recordings and browsing histories, according to security researchers and NSO marketing materials. The spyware can activate cameras or microphones to capture fresh images and recordings. It can listen to calls and voicemails. It can collect location logs of where a user has been and also determine where that user is now, along with data indicating whether the person is stationary or, if moving, in which direction.

It can do all that without any involvement from the iPhone user in what’s known as a zero-click attack. Even odder, people seem content with Apple’s culpability. The theory goes that it is not reasonable for any consumer mobile device to withstand a targeted attack of this caliber. I disagree.

I write about hacks every month. The simple conclusion is that tech companies are not doing enough to protect customers from unwanted intrusions. Perhaps if they were held liable, we would see some improvement, but we may never know. The risks have expanded beyond dumb passwords and monetization of PII. It’s banks, governments, pipelines, and other core infrastructure that are regularly being compromised. We also learned this month that more than a billion Android devices have over 400 known vulnerabilities in Qualcomm’s Snapdragon chip.

This is one of the reasons why I am so intrigued by crypto-assets. The combination of open-source software and gigantic honey pots is creating an incredibly impressive solution stack. Assets such as Bitcoin and Ethereum are among the most robust and secure software solutions the world has ever seen. Far more robust than companies can afford to build.

5G Software: When President Trump was at war with Huawei, the US put a lot of pressure on allies to avoid network hardware from Chinese companies. If only there were an American alternative. That seems to be happening now, and in American style, the new solution is software, not hardware.

AT&T announced it is moving its 5G management systems to Azure, and Vodafone is piloting an Ericsson/Google partnership. This dance might look familiar to the UCC crowd. Basically, cellular is transitioning from bespoke hardware to commodity (radio) hardware powered by the cloud.

Hybrid G Calendar: I often lament about the lack of innovation in calendaring. Google just announced a very simple and completely appropriate update to Google Calendar for hybrid work. When accepting an invitation, users will soon be able to indicate if they intend to join in person or virtually.

Chinese Tech Crackdown: I am completely confused about what China is doing to its tech companies. I don’t think I’m alone, but fortunately, I don’t think it matters to enterprise comms. Trump already took the wind out of Huawei’s sails, so there’s just not much direct impact to enterprise comms. The indirect impact does pose a threat in terms of disruption to hardware supply-chains and potential effects on the global economy.

JEDI No More: I love the Star Wars references, but I don’t know who (Amazon, Microsoft, or the DoD) is the Evil Empire in this version. The Defense Department canceled its coveted and highly politicized cloud-computing contract. Microsoft officially won the bid, but Amazon filed suit that there was improper interference from the Trump administration. The Pentagon opted to walk away from the $10B contract, saying “it no longer meets its needs” (should have gone with a mainframe). The new plan is to solicit smaller, piecemeal projects, and the new umbrella name is “Warfighter Cloud Capability” — fighting the cloud is futile.

NEC and MS: Microsoft and NEC updated their long-term agreement to include Azure and Microsoft 365. MS will also leverage NEC’s network and IT expertise, including 5G. One immediate result is that NEC will make Azure its preferred cloud platform. Specifically, NEC’s Digital Workplace Group’s 110,000 employees will migrate to Azure Virtual Desktop and other services.

Meetings and Messaging

Teams 250M: Microsoft CEO Nadella reported some impressive Q4 results. The company increased revenue 21% YoY to $46.2B, and Operating Income was up 42% to $19.1B. He also revealed Microsoft Teams is at “nearly 250M monthly active users [MAU] as people use Teams each day to communicate, collaborate, and co-author content.” That’s up from the last revelation of 145M DAU last May.

The pandemic was very good for Microsoft Teams. I was not alone in thinking that Teams was in for a slow uptake due to its complexity, but there’s nothing like a global pandemic to encourage reimagining work. It seems likely that Teams has already moved from the Early Adopters to the Early Majority phase. It’s impressive growth, and there’s more to come.

Microsoft hasn’t been exactly transparent about how it defines MAU. Assuming it’s consistent, the measure is mostly valuable for noting growth. Teams active users cannot be easily compared to other applications. Slack, for example, offers messaging but not calling or meetings. Presumably, any Teams activity (calling, chatting, meeting, etc.) counts toward MAU. However, even using these figures for growth is tricky because Microsoft changed from DAU to MAU.

Nadella also claimed that “we have nearly 80M monthly active Teams Phones users, with total calls surpassing 1B in a single month this quarter.” I'm suspicious of that claim, and wonder exactly what they counted to get to 80M. I’m guessing just about anything a phone can do: Unanswered call? Peer-to-peer calls (without PSTN)? An external voicemail message recording? Call Me services? Anyone who dials into an audio or video conference?

Let’s try working it the other way. In terms of E5 users, we know they are only about 5% of the paid licenses (so somewhere around 15M users/mo). Then we can double that to include standalone users, giving us something like 15M-30M paid Teams phone users. So, if 100% of the phone users made at least one call a month (not likely), we can get close to 30M MAU. Perhaps Nadella is counting digits-dialed instead of calls? I suspect we will hear more about this 80M; it’s a specific workload that lends itself to comparison. [Microsoft clarified in August that it did include in its count non PSTN calls].

Webex for Defense: Cisco added to its verticalized versions of the Webex Suite with a new Webex for Defense offer. It has already received provisional authorization from the Defense Information Systems Agency (DISA) to operate at DoD Impact Level 5 (IL5) for all workloads (including calling, meeting and messaging, and devices). This is in addition to the regular Webex FedRAMP-program. The move seems appropriate, considering the NSA recently published a set of guidelines for “Selecting and Safely Using Collaboration Services for Telework” that rated Webex as very secure.

Zoom Rooms Enhancements: Zoom announced several updates to Zoom Rooms, including a new Smart Gallery (announced last year) that cleverly creates multiple virtual cameras out of one — no more crowding. It also includes a voice UI for starting and stopping meetings, and in-meeting chat makes its debut in rooms.

Continuing its focus on enabling hybrid work, Zoom yesterday shared in a blog post several new features for its Zoom Rooms service. Zoom also unified its approach to device management with a unified view for phone and room devices. Zoom Phone now is easier to access from conference rooms, and NDI support arrived.

Teams Gets Dynamic: At the Inspire partner conference, Microsoft introduced integrations between Teams and Dynamics 365. I’ll quote Zeus: “Microsoft is a fast-follower.” The news comes just seven months after Salesforce’s announcement that it would acquire Slack. It’s a logical move for Microsoft but won’t take away from the growing interest in connecting Teams to contact centers.

This is one of the problems with the combined UCaaS/CCaaS bundle — it never ends. There’s growing interest in the combined comms stack from smaller companies, but the entire solution also involves CPaaS and CRM.

Microsoft also plans to let third-party software developers sell apps (to IT) directly within Teams via the Teams admin center. Companies offering Teams apps today include Atlassian Confluence, SAP C4C, Salesforce, ServiceNow and Workday.

Zoom Apps: Zoom updated its apps platform, previously launched as Zapps. Zoom Apps (50 apps) are not the same as the 1,500 or so integrations available in the Zoom marketplace. Zoom apps live within Zoom’s framework. The usual suspects are the list, such as Asana, Dropbox, and SurveyMonkey. But there are also some new names.

I’d like to highlight a new app called the Dots Collector. New to me, but evidently, it also exists within Slack (with plans to further expand). Available in free and paid/enterprise versions, it’s designed to facilitate “radical transparency” in peer feedback. It’s from Principles, a Ray Dalio company. The idea is that colleagues can provide unsolicited yet structured evaluations at any time during a Zoom meeting. These dots, by default, are visible and attributed. The free version doesn’t store anything, but the enterprise version collects this feedback for further analysis.

Zoom Chat: Zoom Chat UI got a necessary update that should make threaded conversations easier to follow.

Events: Both Cisco and Zoom expanded their Events programs. This new, pandemic-born category — a logical expansion from webinars — includes several pure plays, such as Hopin. Events solutions provide additional tools to manage registration, attendance, and ticket sales, collect feedback, and distribute content. This month Zoom Events became generally available; it’s an expanded offer of the OnZoom program introduced last year, suitable for larger events. Cisco closed on its acquisition of Socio Labs this month (announced in May) and expanded events to support 10K bidirectional participants. Webex Events can be rebranded.

Dialpad Meetings: Dialpad upgraded and rebranded its meeting service. UberConference is now Dialpad Meetings, and it’s significantly improved. I wrote about it on NoJitter. The upshot: Dialpad is executing. I recap news every month, and I can’t help but notice Dialpad has become a regular in the Insider Reports. It completed a fundraising round last year and has been steadily implementing updates since. It does have a voice-centric CCaaS, but I expect that will change soon. Dialpad is one of the few companies in the UCC sector that still has much of its original team (and founder) in place.

Cisco Webex Updates: Cisco announced several updates to Webex this month. As telehealth is booming, it opened up its integration with Epic. Cisco/Epic have enjoyed what appears to have been an exclusive partnership, but Webex now has tools to integrate with other telehealth (and education) apps. Also, Cisco now includes the Webex assistant in all of its paid plans. Previously, the speech UI on Webex Assistant was a separately charged feature. Translation services (reasonably) remain an add-on. For more Cisco updates, see here.

Telegram Updates: More updates again in July. Telegram announced several video improvements, including support for up to 1K viewers (30 active participants). Other updates include screen-sharing for one-on-one video calls, expanded options to auto-delete messages, and some UI changes.

MS Teams Updates: Two new features released in Preview are aimed at frontline workers, including a new Walkie Talkie mode and new Shifts connectors. The Walkie Talkie feature is available on iOS. Considering how everyone loves PTT, I don’t understand why it’s not just standard on every app. The Shifts update connects Teams to Blue Yonder and Zebra-Reflexis. It’s a logical progression for Shifts. I keep expecting the WFO players to expand beyond the contact center. Now I’m thinking that general-purpose scheduling apps like Shifts are more likely to replace WEM-specific scheduling tools.

Microsoft also enabled a default option to record all meetings automatically. I think that’s reasonable, but I would also like an option to just transcribe meetings. Recording freaks people out, and to my understanding, transcription doesn’t require notification. There are actually quite a few additional updates to Teams this month, but they are relatively minor. You can read about them all here.

RCS Is Closer: It took over a decade, but the next generation of SMS is arriving in the US. Now that Verizon finally caved, it looks like all three big US wireless carriers will support RCS (by default) within a year. Google agreed to host the back-end and provide the mobile client (Android Messages) — though it’s meant to be an open platform.

Just to keep things complicated, Verizon will continue to preload its Verizon Message+ (VM+) application, too, until Google can sync messages across multiple endpoints. RCS offers a variety of upgrades over SMS, including high-res images and video sharing, maps and directions, location sharing, typing indicator, and more. The latest RCS twist adds encryption, too.

RCS and Apple iMessage only offer encryption within their ecosystems. RCS will supposedly work across US carriers (assuming everyone uses Android Messages). Apple has not indicated any interest in supporting RCS on the iPhone. Rich-formatted messaging will drive new services for CPaaS providers.

Pay Up: Google is putting a 60-minute limit on video meetings for its unpaid Workspace subscribers. The unlimited offer was launched in association with the pandemic. I figured it would remain free as a loss leader, but this is better for the industry. Still, 60 minutes is 20 minutes longer than Zoom’s free offer. Google Meet is included in the Workspace subscription but can also be purchased à la carte for $10/mo.

Google also got more aggressive about finally phasing out Hangouts. Google Meet definitely offers better video than Hangouts, but I liked video and chat combined in a single application.

Skype for Business Offline (SfBO): All good things come to an end, and so did Skype for Business Online. This was Microsoft’s UCaaS 1.0, and it officially retired on July 31, 2021. SfBO was doomed the day after Teams launched, but its end was reasonably graceful. Microsoft first announced its retirement two years ago. If an organization didn’t move to Teams on its own, Microsoft provided assisted migrations.

Nimble: The simple CRM for Microsoft 365 and Google Workspace teams announced a Teams integration. Nimble’s in-app add-in for Microsoft Teams enables users to prepare before meetings, log key details during a meeting, and most importantly, follow up after meetings. Nimble works directly in the Microsoft 365 inbox or via its Prospector browser extension.

Visual Collaboration: How to virtualize the whiteboard? It’s the remaining analog device in the meeting room. It seems so silly, but drawings are really important. Lots of ideas are hard to convey with words or a keyboard. The first generation was the all-in-one eboards such as the Surface Hub, Jamboard, and Spark Board. Those digitize our drawings, but he/she who holds the stylus has the power. The next gen is the camera on top of the old whiteboard; options are available from Lifesize and Logitech. These are inexpensive, and a good option for schools (presenter to audience), but not ideal for highly collaborative teams. The new emerging options are completely software-based and leverage participant touchscreens for participation. One of the big advantages of this approach is that the content becomes portable across meeting services. Microsoft has its own app, but Mural and Miro have emerged as category leaders.

This month, Cisco Webex announced integrations with both Mural and Miro. Dialpad announced an integration with Miro.

Discord Threads: Discord added threading to its messaging service. Threading is a no-win situation. Single-stream is simple, but conversations get confusing. Threading solves that but adds complexity. In addition to threading, Discord also has archiving. Threading is logical, but no one has really nailed the UI yet. Long live email.

Google Meet App: The browser-only company released an app for Meet, but to its credit, it’s a progressive web app — essentially a browser-based app. It will run on any device with a reasonably current version of the Google Chrome browser.

Engagement

CCaaS 2021: CCaaS is on fire. The vast majority of my conversations are CCaaS-related. This month was dominated by Zoom and Five9, but that was just one story. Also this month, AWS hosted its first analyst event. Twilio provided an update on Flex and Segment, and I’ve seen a spike in various solutions that strengthen CCaaS. It has been surprisingly quiet from Genesys, Talkdesk, and NICE inContact. However, inContact just scheduled an analyst event, and Talkdesk will likely announce completion of a Series D in August. CCaaS is not commoditizing — at least not as quickly as UCaaS. It’s more lucrative and stickier.

Five9 IVA: Five9 announced updates to its IVA platform, including prebuilt solutions for health care, new partners for voice biometrics, real-time speech analytics, and agent coaching. Five9’s schtick (and I’m not making this up) is to use AI to create a more human experience. There’s certainly merit to the concept.

AI has been and will continue to dominate the contact center conversation, but it’s really got a long way to go. What I like about the conversation, though, is that it has shifted from cost savings to a better experience. Five9 updated its no-code Inference Studio with more controls and features. Voice biometrics is a good example of a security model that is more human with AI. The solution also works with multiple AI partners, including AWS, GCP, IBM, and more.

The big problem all CCaaS providers need to overcome involves the scars from IVR battles. I’m happy to engage with a bot if there’s a chance it can help me. I’ve launched a new weekly newsletter on Revue, and I’ve been impressed with its help bot (text ui). But most callers still see IVRs as a barrier to service. Most 800-number call centers make repeated attempts to deflect callers to automated solutions. This is what I want to hear: “If you would like to talk to an agent, press zero. Our automated solutions are pretty pretty pretty good and may be faster; to try it press or say ….” In other words, a choice, not a maze.

Twilio’s New Journey: Twilio launched Journeys, based on Segment. The technology makes marketing easier by simplifying integrations with visual, low-code UI. With Journeys, teams can design multistep experiences, across channels, using triggers based on customer behaviors and context (all with an intuitive UI). From what I gather, it’s a foundational piece that will become a lot more useful in October at Twilio Signal.

Twilio announced it achieved full compliance with the STIR/SHAKEN protocol. Calls made via Twilio’s cloud platform are now supposedly spoof proof. Suspicious calls get an indicator to alert users.

ServiceCloud Integration: Avaya and Vonage announced new Service Cloud integrations. Both providers have apps on the Salesforce AppExchange. Avaya OneCloud for Service Cloud delivers AI-enhanced customer engagement and unites voice, digital channels, and customer insights into a single view. Vonage CCaaS for Service Cloud is available in 80 countries and supports chat, email, messaging, SMS, and social services.

Nextiva CCaaS: The networking and comms provider announced a new CCaaS. It is the second provider to offer a rebranded version of Five9 (after AT&T). Features include skills-based routing, self-service IVR and IVAs, intelligent call routing, plus workforce management and optimization capabilities.

Ooma and UJET: Ooma announced it is now offering UJET’s CCaaS. It’s a good move. Ooma largely relies on third parties for its technologies, yet retains a unique offering. UJET offers a platform optimized for smartphone customer engagement, which should complement its enterprise business. I expect Ooma will also launch a simpler call center solution for its small business segment. Ooma kept the UJET branding but will provide the implementation, first-level support, and a single invoice.

Uniphore: Conversational service automation platform provider Uniphore announced updates to U-Assist, its deep-learning AI tool for agent after-call and dispositions logs. The new update includes interaction sectioning for call wrap-up automation, intent detection, and supervisor alerts.

There’s tremendous activity in conversational AI. The technologies are generally amazing and represent significant progress. But I can’t keep track of all the providers, and they don’t seem particularly good at differentiating themselves. However, I do believe customers will optimize their solutions with best-of-breed components despite most CCaaS providers having their own or preferred conversational AI solution.

WCCaaS: In an analyst briefing, Javed Khan revealed that Webex Contact Center is the fastest-growing part of Webex and shared logos of wins and migrations. Cisco has integrated IMIMobile into Webex Contact Center, which replaced and expanded (Facebook Messenger) its omnichannel services and serves SMS directly. Cisco also released a visual workflow builder that gives Webex CCaaS a low-code, orchestration capability. Cisco believes its expanded customer journey and CPaaS capabilities will further accelerate Webex CX business.

Talkdesk Value: Talkdesk unveiled a CX Strategy Value Framework to help organizations evaluate and implement new approaches to CX. Talkdesk staff work with prospects and customers to identify priorities and then design a solution that best meets their needs. All engagements with the Talkdesk team are available on a complimentary basis in advance of contract signings. It is difficult to scale a high-touch direct model.

Unified Communications

Mitel and BT: Mitel expanded its partnership with BT to include MiCloud UC and CC customizations. The solutions are based on Mitel’s MiCloud Flex technology and are hosted in the UK. Mitel has a large customer base in the UK.

Mitel also updated its channel GTM with the Amplify and Velocity programs. The Amplify program is aimed at agents, while Velocity is available for Partner Managed partners that want to extend their partner-delivered models for MiCloud Connect and Mitel’s private cloud offering, MiCloud Flex.

Poly Doesn’t Go Viral: Earlier this year, Poly came down with a case of Microban on its wireless devices. The situation spread this month to its VVX x50 endpoints. The material coating on its devices actively reduces bacterial spread, so no more excuses for not taking my calls.

UNIVERGE BLUE in Japan: The UCaaS business in Japan has been a tough nut to crack. In addition to language barriers, the Japanese market is tightly regulated, which has contained the growth of UCaaS. NEC, which holds a dominant position in call control licensing, has a new approach: NEC Bridge. The service is powered by Intermedia, NEC’s UCaaS partner. NEC Bridge adds a variety of cloud-delivered features to its NEC Univerge premises-based solutions, including presence, IM, meetings, and file-sharing services. It is currently in beta, and NEC expects to make it generally available in Japan this fall. To me, it makes sense for NEC to launch the companion app to its global IP PBX base.

Regarding Japan, also watch Dialpad. SoftBank is a major investor of Dialpad and holds an exclusive partnership to resell Dialpad in Japan.

RingCentral BYOC: RingCentral and Bandwidth expanded their partnership in a pseudo-BYOC program. It allows customers to work directly with Bandwidth for its carrier services. It’s essentially a BYOC offer, but it’s (currently) limited to Bandwidth (BYOBW). This further expands the global reach of RingCentral’s offers. For more information, see my post on NoJitter.

Google Voice Updates: Google announced several updates to its UCaaS offer known as Google Voice. A new feature offers to guess why a call was missed (i.e., DND was on). It can also guess the cause of dropped calls. Google Voice users can now delete multiple SMS messages at once.

The bigger story here is that Google remembered it has a UCaaS service. I can’t recall any updates to the service since it was launched several years ago. If anything, I expected support for RCS messaging on Google Voice, but that’s too obvious.

UCaaS Phase 3: Wholesale services are heating up again. The pioneers that built their hosted VoiP platforms on BroadSoft, Metaswitch, and Genband gave rise to the UCaaS sector but got pushed out by high-growth providers that own-and-control their own solutions, such as Cisco, Microsoft, RingCentral, and others. We may be entering round three, as commoditization has providers seeking ways to differentiate. Wholesale providers such as 2600Hz, Alianza, and Crexendo/NetSapiens are seeing increased interest in (different types of) wholesale.

Financial News

Talkdesk Series D? I’ve heard from multiple sources that The Information’s report that Talkdesk is doing a Series D round that values the company at more than $10B is true. Talkdesk has not released any information or confirmed this in any way. The Information reported that the company plans to raise up to $210M at a share price that is 3.2 times higher than its Series C round last July based on a $3B valuation. The proposed valuation is more than 50 times the revenue Talkdesk expects to generate in the next 12 months.

Mmhmm Affects Few: The video company with the dumb name raised $100M. It is also expanding from companion app to standalone product. It was likely built to be acquired, but no meetings providers snagged it.

It works by creating a virtual camera between the actual camera and the meeting app. Instead of acquiring Mmhmm, several video providers have added their own special effects. Zoom, for example, offers silly hats. I expect Mmhmm will move more toward post-production editing instead of real-time video manipulation if it doesn’t find a buyer soon.

Mural announced that it has closed a $50M Series C that values the visual collaboration provider at more than $2B. Previously, Mural was valued at around $500M when it closed a $118M round last August. Mural also raised a $23M Series A at the start of 2020.

Vitally raised $9M in Series A funding. The New York-based firm unifies customer data and provides engagement insights. The goal is to anticipate customer needs and reduce churn. Vitally raised a total of $10.6M, including the new funding.

Teamflow raised a $35M Series B round at a $225M valuation. It offers a customizable virtual office designed to simulate a physical workplace. It seems odd to me, but the virtual world includes desks, hallways, and supposedly opportunities for impromptu conversations. Founded in July 2020, Teamflow launched its product five months ago and has attracted customers such as Netflix and Shopify. The company claims it has logged more than a million hours of meetings. The startup has raised $50M in total over the last 12 months

Osmos came out of stealth this month and is ready to help enterprises use ML to understand their data. It raised $13M. Osmos’ goal is to ease the analytics burden by allowing apps to talk directly to each other. Sounds a bit like Twilio’s Segment. It features both no-code UI and integration capabilities.

Dixa: Yet another conversational customer engagement provider announced that it raised $105M in a Series C funding round. Dixa, based in Denmark, launched in 2018. The platform allows brands to unify channels in a single system, equipping agents with tools like cross-channel prioritization, routing capabilities, and integrations. The service also has an integrated softphone.

Acquisitions

Zoom and Five9: Zoom acquiring Five9 is without a doubt the biggest news of the month, arguably the year, and probably the decade. The news broke the evening of Sunday, July 18, and dominated the internet on Monday. The speed of analysis is almost as important as the news, so TalkingPointz published a 5.5-page research note on Tuesday, July 20. I won’t rehash the report here but will highlight some themes of the ongoing conversations.

First, the valuation of Five9. It was presented at about $200/share (which is a bit low), but that’s a distraction. The real price is yet to be determined. The companies agreed on 0.5533 shares of ZM for each share of FIVN. Since the deal isn’t expected to close for up to a year, the actual price Zoom will pay remains unknown. Subsequently, Five9 reported that it increased quarterly revenue 45%. That continued growth is now more likely to impact the valuation of ZM than FIVN. It appears that based on current figures, Five9 represents about 16% of Zoom’s revenue.

Two very compelling narratives are emerging in the wake of this acquisition announcement, but only one can be true. One narrative is that this changes nothing. The deal is a year away from completion, and integration will take years after that. The SWOTs and roadmaps of both Zoom and Five9 remain unchanged.

Conversely, there’s also an argument that the deal changes everything. Arguably the largest and most powerful UCC vendor has just acquired one of the largest CCaaS providers. It has escalated Five9’s competitive stature — after all, Zoom could have acquired any CCaaS provider it wanted.

The fun new guessing game is to speculate the next shoe to drop. A popular theory is that Microsoft will acquire a CCaaS provider (Content Guru looks like a good fit). Or perhaps Zoom does an acquihire to make its $14B acquisition of Five9 work. For example, acquiring Avaya would be a quick way to build a global base of subject matter experts.

Also this month, Salesforce closed its acquisition of Slack (that one took seven months; Zoom’s yearlong timeline for closing on Five9 is perplexing). While both acquisitions are generally positive, I think Salesforce acquiring Five9 and Zoom acquiring Slack would have been a better story — easily corrected by Salesforce acquiring Zoom.

NICE and ContactEngine: This acquisition has already created a new product: CXone SmartReach. ContactEngine offers conversational AI with the twist of being proactive. In other words, unlike most bots, it automatically detects when it fails and turns the call over to an agent for damage control. The pitch is that it combines digital and self-service to deliver proactive service — though the proactive pitch is dubious as the customer is likely already engaged in (self) service. ContactEngine’s 2019 revenue was €9M. Financial terms were not disclosed. Last April, NICE acquired MindTouch.

Lumen and Stonepeak: Lumen said “adios” to low valuation after announcing the sale of its Latin American business to Stonepeak for $2.7B. The deal is expected to close 1H2022 after regulatory approvals. The deal was a surprise, but I’m not sure why. Carriers no longer get credit for owning cable (or in the case of wireless owning cell towers). It’s all software now. For example, Gartner’s MQ on Network Providers places Lumen close to several providers that don’t own physical networks. Seems like an astute move: Lumen got 9x LATAM’s estimated EBITDA for 2020. $2.7B buys a lot of software.

Uniphore and Jacada: Conversational AI vendor Uniphore announced the acquisition of Jacada, a low-code/no-code CC process automation company. Automation of back-end processes is as important as automating front-end CCaaS interactions. There are several vendors that enable automation, including Starfish Associates, Kurmi, and VOSS. I think it’s pretty clever for a CCaaS provider to own and control the technology, which can also be used to simplify migrations. This opportunity is where automation, RPA, CX, and AI intersect.

Telesystem and VoxNet: Telesystem agreed to acquire the assets of managed services provider VoxNet, previously part of the holdings of Helm Partners. VoxNet provides unified communications, managed security services, and internet access to end-user customers in 38 states. Telesystem offers UC platforms, geographic redundancy from its nationwide network, and SD-WAN services.

Lumine and Concentrix: Lumine Group (“Lumine”), a division of Volaris Group, agreed to acquire the mobile network solutions business from Concentrix. The business, which includes software capabilities in call completion, messaging, and online charging for communications services providers worldwide, will be marketed under the newly created brand “NetEngage” — a fully autonomous Lumine business. NetEngage is Lumine’s 21st acquisition. NetEngage serves customers in EMEA.

Wholesale UCaaS: Thompson Street Capital Partners (TSCP) acquired Wholesale Carrier Services (WCS) for its BCM One business. The WCS brand and array of data and voice solutions will be integrated into the BCM One brand by the end of the year. WCS offers UCaaS and managed services. This acquisition expands BCM One’s global presence into APAC. It represents the seventh acquisition for BCM One.

This Month’s Goodreads

Both a longer list and a clearer theme than usual: The return to the office has been rescheduled.

Other Stuff

The TalkingHeadz Podcasts are interviews with the movers and shakers of enterprise communications — plus we have some interesting guests. Subscribe on your favorite podcast app. We strive for two episodes a month.

Darren Schreiber of 2600Hz discusses the convergence of UCaaS and CPaaS

Aurangzeb Khan of Jabra Panacast explains why three cams are better than one

BONUS: How CPaaS makes CCaaS better with Avaya’s OneCloud CPaaS pros, Davide and Laura

Real-Time, Recorded is a weekly short video about industry news now on NoJitter. Sometimes news can’t wait for the newsletter. Dave Michels and Zeus Kerravala provide what you need to know in a weekly short video discussion.

TalkingPointz Insider Reports are available through a subscription service at TalkingPointz.com.

A new recurring section to highlight a featured enterprise comms rising star

Gridspace, a California-based conversational AI company. It provides conversational analytics and virtual agents to large contact centers. This is a hot sector, particularly with regards to health care and financial services companies looking to increase the quality and lower the cost of their customer service interactions. Gridspace came out of SRI Speech Labs (as did Siri and Nuance).

Product: Gridspace Sift is a no-code platform that helps contact centers analyze customer calls for emotion, intent and context. The product is capable of handling more than 50,000 concurrent calls and providing immediate performance feedback to agents. For managers, Gridspace Sift also identifies contact center-wide trends, events and operational issues. Gridspace Grace is the company’s virtual agent offering. It allows managers to alleviate hold times and reach more customers with natural-sounding voice bots.

Partners: Has integrations with Cisco, Avaya, Twilio, and more.

More Information: Check out our recent conversation with the Founder and CEO.

Why: Agents spend 16-20% of their time seeking information to do their jobs. They also use at least three different systems to seek customer insights or knowledgeable articles to address client issues. In addition to delaying the average handle times, these things affect agent productivity. The tech is ready, but the tech included in the CCaaS may not be enough. Conversational technology is going to dramatically disrupt customer engagement.

Any Questions?

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Personal subscriptions are available to view on TalkingPointz.com. Enterprise subscriptions are multi-user and include a downloadable version of this and other reports.

Companies in this report

2600Hz

Alianza

Amazon

Avaya

Bandwidth

Cisco

Concentrix

ContactEngine

Crexendo

Dialpad

Discord

Dixa

Ericsson

Five9

Genband

Genesys

Google

Gridspace

Huawei

Interactive Intelligence

Intermedia

Jabra

Jacada

Kurmi

Lumen

Lumine

Metaswitch

Microsoft

Miro

Mitel

Mmhmm

Mural

NEC

NICE inContact

Nimble

Nortel

Ooma

Osmos

Poly

Principles

Ribbon

RingCentral

Slack

Starfish Associates

Stonepeak

Talkdesk

Teamflow

Telesystem

Twilio

UJET

Uniphore

Vitally

Vodafone

Vonage

VOSS

VoxNet

Wholesale Carrier Services

Zoom

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By Dave Michels

Dave is an independent analyst and founder of TalkingPointz which is focused on enterprise communications. In addition to this (free and paid) content on TalkingPointz, he contributes to industry sites, can be found at major industry events, and provides advisory services to vendors and financial analysts.