The 2011 Market Leaders
PROFESSIONAL SERVICES
The Market
The downturn has had a muted affect on the professional services market because these offerings have, by and large, provided companies with cost-reduction benefits that have helped them weather the storm. In fact, the recession has forced organizations to make cutting costs a top priority, which has more companies looking to hosted solutions to help accomplish that goal.
Analysys Mason and many other analyst firms expect the strongest growth to come from the hosted/managed services subsegment, where spending is expected to eclipse premises-based solutions by 2012. In fact, hosted/managed services have seen double-digit growth since 2008 while revenues from on-premises solutions have followed an inverse downward course. Growth is also expected in systems integration, outsourced operations, product-related services, design consulting, and custom development.
“In the short term, spending will be driven by transformation initiatives in developed markets and by outsourced operations in emerging markets,” says Glen Ragoonanan, senior analyst at Analysys Mason. “In the long term, new technologies, services, and business models will drive spending in developed markets, while transformation projects become increasingly common in emerging markets.”
Ragoonanan also expects stiffer competition to help drive down prices, which would make these types of services more attractive and easier to justify in a business case.
The Leaders
Angel, which recently dropped the dot-com from its name, outpaced competitors in customer satisfaction with a 4.7. The company’s low prices led the pack, earning it a 4.0 cost score. At the same time, Angel maintains a solid reputation for providing “affordable, basic applications that don’t require complex professional services engagements,” says Deborah Dahl, principal at speech and language consulting firm Conversational Technologies.
West Interactive, a leader in 2007, 2008, and 2009, failed to make the leaderboard in 2010 but is back and stronger than ever in 2011. It finished with a 4.5 in both the number and breadth of services offered and its ability to execute. Named Frost & Sullivan’s 2010 Company of the Year in Contact Center Outsourcing, the vendor “continues to distinguish itself by the sheer depth of its services,” says Michael DeSalles, strategic analyst at Frost & Sullivan. “No other single player can offer a comprehensive mix of services across all areas: voice self-service, speech solutions, automated notifications, conferencing and collaboration, emergency communications, agent-assisted voice support, and advanced hosted contact center technology.”
Now that West has a presence in social media monitoring and engagement, look for it to bring those elements into its portfolio as well. The company’s offerings will undoubtedly expand even further as it moves forward with its recent acquisition of Smoothstone IP Communications, a provider of software-driven applications that exist in the cloud and are delivered through a software-as-a-service model.
The Winner
SpeechCycle, the winner in 2007 and a leader in 2009, takes the top spot again this year among professional services providers. With scores of 4.5 in the number and breadth of services offered, ability to execute, and customer satisfaction, its Customer Experience Transformation Services team reinforces its reputation for providing the consulting, design and development tools, and support that companies need to extend legacy systems and implement new and robust ones. “Its focus is on complex applications,” Dahl says.
Vendor Contender
Convergys, the winner in 2009 and a leader in 2007, falls back to Vendor Contender this year after a rough patch that saw it struggle with integration issues stemming from a 2008 acquisition of Intervoice, according to some analysts. The company finished with a very respectable 4.3 in depth and breadth of functionality and its ability to execute. The company’s professional services group, which consists of more than 200 customer experience optimization experts, even offers a written performance guarantee with penalties paid out if they fail to meet specified goals.
—Leonard Klie
MOBILE VOICE SEARCH
The Market
Once vaunted as an untapped field of bounty, mobile voice search is unclaimed territory no more. According to a Comscore report released this year, 72.5 million Americans owned smartphones in the first quarter of 2011—up by 15 percent from the end of last year. That’s nearly one-third of the entire mobile phone market. And the trend promises to continue, with enormous implications for speech-enabled search.
“Smartphones have a lot of computing power and great visual displays, but they are terrible input devices,” says Bill Scholz, speech technology consultant and president of New Speech. “It’s extremely difficult to use on-screen keyboards or those tiny keyboards where the keys are as big as your pinky fingernail…it’s created a great opportunity for speech input.”
Platform vendors realized that early on and developed speech capabilities in-house or acquired firms that had them. The native on-phone products have gotten so good that they will likely dominate usage, making things difficult for third-party vendors.
The two obvious leaders in the platform race are Google and Apple, both of which have managed to crowd out Microsoft and its Tellme offering. Microsoft’s erosion in the space is particularly interesting, because it has remained a dark (albeit very rich) horse to watch among analysts. The reason was put succinctly by Juan Gilbert, professor and chair of the Human-Centered Computing Division at Clemson University: “[Historically] Microsoft tends to come in late and then dominate.”
Whether the software behemoth can do that again is a source of some skepticism for Gilbert, though. “In mobile devices, they pretty much snoozed and got boxed out. They’re trying to come back, but I don’t see it happening.”
The Leaders
Rising from Vendor Contender last year to a leader in this category is Apple. Last year, the company made a splash in the speech industry when it bought Siri for $200 million. Many saw that as a strong move, and its fruits are represented in this year’s standings. Apple’s mobile speech product is available only on the iPhone, but that makes up as much as one-quarter of the entire U.S. smartphone market, according to Comscore.
That proportion may grow now that Apple’s exclusivity deal with AT&T has expired and the iPhone 4 is available on Verizon, the largest cellphone carrier in the United States.
Also a leader this year is Vlingo, a perennial third-party darling among speech technologists. In previous years, the company had been narrowly edged by Google. This year, Vlingo was outstripped by yards. It scored well overall, but its numbers were more akin to Apple’s than to Google’s. The biggest challenge for Vlingo going forward will be to stay relevant. To have any kind of pull as a third-party product, Vlingo must entice users to forgo their native on-phone search and go through the trouble of downloading it. The company will need a mighty compelling offering for that. Of course, who knows…Vlingo could always get acquired.
The Winner
This category resembles 1990s Olympic basketball with Google playing the U.S. Dream Team. The company’s mobile voice offering trounced rivals for the third year in a row; the scores weren’t even competitive, largely thanks to Android. In the past few months, the platform has taken market share from Research In Motion (RIM).
According to two 2011 reports from Comscore, Canada’s RIM controlled 33 percent of the smartphone market as recently as November but lost about six percentage points by March. Google, conversely, rose from 26 percent to 34.7 percent during that time. To put that in context, Apple, the next biggest rival, saw only a modest gain of half a percent. Both Microsoft and Palm saw their shares decline.
Significantly, Google Voice comes native on the Android platform—which means that when more than a third of smartphone users reach for voice-enabled features, the easiest button to push will be Google’s. It also helps that Google’s mobile voice search is the best out there, having earned top marks across the board with our analysts and consultants.
Vendor Contender
AT&T is our runner-up this year with its solid accuracy and speed scores. However, the company faces increasing relevancy challenges in mobile voice search—a field that continues to be dominated by Google and Apple.
—Eric Barkin
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