Can Amazon Connect Disrupt the Contact Center Market?
Late March, Amazon made the news at Enterprise Connect, announcing a cloud contact center offer, Amazon Connect, derived from its internally developed solution. Amazon's reputation for providing great customer service and the scale of its operations provided immediate credit to it. Amazon shared the three major limitations of existing commercial offerings that led to the decision to developing its own: complexity, lack of scalability, and poor cloud architecture. Amazon Connect follows the introduction a few weeks earlier of another communication offering, Amazon Chime, providing voice and video calling and meeting.
Amazon Connect almost hijacked the event. Now that the dust has settled, let’s explore what it means to the market and its potential to disrupt it.
Incumbent contact center providers
Legacy vendors Avaya, Cisco, and Genesys have a few reasons to be worried. Their traction in the cloud space has been limited. Furthermore, their operating model has remained dependent on the cash flows of traditional software licenses. It drove them to entrench in their customer bases, benefiting from enterprises' slow adoption of cloud solutions. Indeed, many midsize businesses and enterprises have been concerned that cloud solutions are not ready for large deployments and cannot accommodate their specific business processes. With its scale and excellent customer service reputation, Amazon Connect has signaled a new readiness level of cloud solutions. It should trigger large enterprises revisiting their stance and cloud strategy.
Emerging cloud contact center contenders
Five9, InContact, and Interactive Intelligence have been able to ride the cloud wave to become sizable contenders. However, they are not in the ideal shape to confront a new large player. In the short term, they should benefit from the cloud boost created by Amazon. But they have been facing profitability challenges forcing them to become much bigger, in particular by expanding rapidly upmarket. InContact and Interactive Intelligence ended up selling themselves to Nice and Genesys. The three players need to refresh their aging architectures. Interactive Intelligence undertook a major re-architecture with its Pure Cloud offer and needs to ramp its feature set. Five9 and InContact have taken a more incremental approach. They will all need to up their game to handle a large competitor with a powerful cloud architecture.
Communication Platform as a Service
A few analysts were quick to point out Amazon Connect could threaten Twilio. Twilio and the other communication Platform as a Service (cPaaS) providers have initially focused on contact center augmentation use cases. They have evolved since to enable “do-it-yourselfers” building their own contact centers. It started with product vendors such as Talkdesk or Serenova. Last year Twilio announced that ING Bank. would replace 17 different legacy call center systems deployed in over 40 countries with a homegrown solution built on Twilio’s platform. Indeed, the complexity of legacy solutions and the difficulties to evolve them have been plaguing the industry. Amazon Connect could become appealing to do-it-yourselfers for three reasons. First, building a complete contact center solution from APIs is not a small job. Leveraging a prebuilt call center should simplify such a project. Second, Amazon provides access to all the other technologies of the Amazon Web Services (AWS) stack. Eventually, Amazon is offering already aggressively priced telecom. If CPaaS vendors are gaining a competitor for “building-your-own” contact center, they are also getting a validation of this alternate model to assemble a contact center solution.
Interactive Voice Response vendors
Amazon doesn’t provide a standalone Interactive Voice Response (IVR), but it has all the technology needed to do so. If it were to, it would immediately become a low cost alternative. It would also offer an easy access to Lex, the speech and Natural Language Processing (NLP) behind Alexa.
Customer Relationship Management players
The last two years have witnessed the making of another Customer Relationship Management (CRM) vendors assault on the call center market. CRM players have turned to cPaaS providers to build their voice capabilities. So far their efforts have been confined to the low end of the market. First and foremost, despite technology advances in communication APIs, it has remained difficult to build an enterprise-class contact center. It is in particular hard to provide all the features needed, with the right level of customizability, while keeping the solution simple and usable with minimal IT support. In addition, telecom sourced through cPaaS vendors is still pricey for enterprises with large call volumes. CRM providers could see in Amazon a compelling alternative, allowing them to assemble their capabilities from a pre-built solution.
Amazon has a lot of cards in hand to impact the contact center market. It will depend if it makes Amazon Connect an extension of AWS by adding call center capabilities to its infrastructure or if it turns it into call center cloud infrastructure. Such a solution, able to integrate and leverage all the other capabilities of AWS and offered with a strong set of APIs could be very disruptive to the market.