Dan Miller, partner & senior analyst, Zelos Group
What's the thinking behind VOX: Service Provider Edition?
Dan Miller By Zelos Group's reckoning, speech automation is the fastest growing segment of the teleservices (or contact center outsourcing) business. DTMF is here to stay, but a growing number of business decision makers are demanding speech recognition from their vendors. We're leading off SpeechTEK with a conference-before-the-conference that showcases firms that have turned to outsourcers and managed service providers to solve their speech automation needs.
How big is the outsourced market for automated speech?
DM It depends on how you define the opportunity. The long-standing, hosted IVR-based "teleservices" industry will be $1 billion in 2003. The fastest growing segment of the industry is driven by automated speech. Zelos Group's research has revealed an industry-within-the-industry that will approach $200 million in 2003.
What's driving the growth?
DM Cost avoidance is core, of course. Outsourcing means no capital investment and spending that can be tied to top line revenues, minutes of use or completed transactions. However, we're living in a time of highly disruptive technology development with the growth of IP and the move to "open standards." That means that business enterprises are also outsourcing to reduce the risk of technological obsolescence.
Who will be speaking at VOX?
DM As a financial, media and telecommunications center, New York is the ideal venue. We're leading off with business decision makers from Merrill Lynch, Readers Digest, Bell Canada and AT&T's consumer marketing division. Each has a story to tell about defining new applications and working with service providers to fulfill their self-service requirements. In response to these requirements, we will hear from a spectrum of service and platform providers from the large —hybrid firms like West, First Data and Convergys - to emerging speech automation specialists like Tellme, NetByTel, Angel.com, Intervoice and Edify).
How about the carrier community?
DM I already mentioned Bell Canada and AT&T, and we'll also have representation from Verizon to discuss where automated voice fits in their self-service strategies. We're closing with a session entitled Dialtone 2.0 to make the point that voice, in combination with a migration to IP-based communications, is redefining the cost structure and risk profile of speech applications.
So what will be the major take-away from VOX: Service Provider Edition?
DM Affordability and speed to market, no doubt about it. It's no coincidence that the session coincides with the first-ever Speech Solutions CHALLENGE. We expect an equal mix of enterprise decision makers, service providers and application developers to share experiences and observe first-hand that the elapsed time from ideation to implementation is short and the cost of launching a new speech application is totally reasonable.
Still, it all gets down to cost, doesn't it?
DM Not really. We're seeing both service providers and core technology providers eliminate barriers to entry one brick at a time. Let's face it, in these economic times business decision makers have a lot of power. As attendees will learn in the afternoon sessions, vendors and service providers are being quite flexible in how they architect solutions and define business relationships. Besides "pure outsourcing," there are all manner of mid-sourcing, co-sourcing or joint hosting - which are short-hand descriptions for separating voice rendering (presentation) from application logic and corporate databases. "Have it your way" doesn't apply just to hamburgers anymore.
You mentioned creative business arrangements. What did you mean?
DM We see risk sharing, gain sharing and other performance-based pricing arrangements. We're fortunate to have executives from EDS, Intervoice and West to discuss some of the creative ways that enterprise wishes are served.
Zelos Group has been in the field with a study of the hosted services business. Are these observations consistent with your findings?
DM Absolutely. We're seeing the usual suspects - financial services, travel, healthcare and telecommunications (including directory assistance) - being stealthily transformed by automated speech. Buyers are getting more sophisticated in terms of defining their needs and determining how they define "success." They recognize that the tastes and preferences of their best customers have been defined by self-service sites on the Web and they need cost-effective way to either extend those resources over the phone or recognize that when those individuals call, they may want live assistance right away. In short they know that automated speech is not the solution to self-service, rather it is one of many options that have to be included in successful self-service solutions.