The end of summer is here, which means for those of us in the communications space, it’s time for Gartner to release its updated Magic Quadrant for Contact Center as a Service.
Unlike in years past, where the year-over-year difference was negligible, 2022 to 2023 saw significant changes and surprises. Below are the notable points from the 2023 CCaaS Magic Quadrant.
Gartner’s Magic Quadrant CSaaS: Shifts and Surprises
The MQ has changed significantly over the years, but one constant has been NICE in the Leader quadrant.
The company has been a de facto standard for some time, and that’s not likely to change any time soon. NICE has significantly invested in AI and partnerships and is well-aligned with industry trends.
In the MQ, Gartner says this about the company, “NICE has a strong vision for supporting end-to-end digital-first journeys, including use of search engine optimization analytics to help optimize digital self- and assisted-service experiences.” I expect to see NICE in the MQ pole position for years.
That Genesys has remained a Leader is a surprise. Like NICE, Genesys has been a mainstay in the Leader quadrant for years, so one might wonder why being in that quadrant in 2023 would be unexpected.
Recall that in October of 2022, the company announced it was shutting down its multi-cloud division, which shows a significant change in strategy. I’m not arguing the decision, but how Genesys could be a leader pre and post-decision is unclear.
If the strategy aligned with Gartner in 2022, it should have seen its position move negatively in 2023. Or the company should not have been a Leader in past MQs and then rewarded positively for the strategy change. Based on the report, shutting down multi-cloud had no impact on Gartner’s view of the company, which is surprising given that was a such a major strategy.
Five9 moves back to the Leader quadrant. From what I understand, Five9 was moved out due to geographic qualification as the MQ became global.
Despite the explanation, I never agreed with Five9 not being in the Leader quadrant, as the company has carried the CCaaS flag for about 20 years. Over the past few years, Five9 has done an excellent job expanding its addressable market both geographically and upmarket. At one time, the knock on Five9 was they had no customers over 1,000 concurrent agents. Today, they can easily handle tens of thousands. I expect to see Five9 continue to move up in both axes.
Amazon Web Services
Amazon Web Services moves into the Leader quadrant. This was another vendor who I felt should have been a Leader last year.
While some of the other vendors tend to get more media attention, AWS has quietly gathered customers of all sizes, including some of the largest contact centers in the world. I’ve talked to Amazon Connect GM Pasquale DeMaio about the MQ, and he told me that while they would like to be in the Leader quadrant, it would not change its strategy to accomplish that.
DeMaio has been consistent in the Amazon Connect mission of bringing a best-in-class, AI-based CCaaS solution to its customers, with the roadmap built from customer feedback. One of the under-appreciated aspects of Connect is the tight integration with other AWS services, which simplifies the process for developers to build on the Connect platform. From what I can tell, this broader AWS advantage isn’t reflected in the MQ analysis.
Also see: Top Digital Transformation Companies
Talkdesk moves from Leader to Visionary. Many industry watchers were surprised when Taldesk was placed in the Leader quadrant, which is still an emerging player.
One of the aspects of the company’s go-to-market I have liked is that it does not try to be all things to all people and has taken a vertical approach focusing on retail, healthcare, and financial services. Two years ago, Talkdesk was very active with the analyst community and media but had gone somewhat dark since then, giving rise to speculation that the company was struggling and had retrenched to retool. Since then, CMO Kathie Johnson has exited the business, with Christie Blake returning to a marketing role. I expect more vision from the company and better clarity on business momentum. This should help it return to the “top right” in the MQ.
The company is a late entrant in an increasingly crowded market but approached the offering correctly. Instead of leveraging the existing legacy contact center, it built CCaaS to be part of the larger Webex platform, which brings tight integration with UCaaS. This can bring features such as background noise removal to agents working from home.
While this took longer than doing a “lift and shift” of the older on-premises solution, it gives Cisco a solid, cloud-native solution to build on.
One of the issues I find with all MQs is they look at the individual products in isolation. One of the unique differentiators for Webex Contact Center is the integration into the broader Cisco portfolio, such as devices and security. For example, remote agents can be more productive and secure if the customer leverages products like ThousandEyes and Duo along with Webex CCaaS. I expect Cisco to continue to move up in the MQ as it gains momentum, but the analysis negates the broader Cisco advantage.
Two vendors noticeable by their absence are Zoom and Avaya. Over the summer, Zoom took the covers off Zoom CCaaS and appears to be off to a running start. I’ve talked to a handful of companies looking at the product, and the general feedback is positive, although it currently lacks some integrations with third-party software vendors. I expect this to be a key focus area for Zoom and hope we see them in the 2024 MQ.
For Avaya, while the product likely would meet Gartner’s product requirements, it likely does not meet the revenue requirements as it was largely ignored during Jim Chirico’s tenure.
Current CEO Alan Masarek has taken a more practical approach to delivering CCaaS to Avaya’s massive customer base, where it will use the cloud to deliver digital capabilities while enabling its customers to continue leveraging the on-premises voice solution.
Avaya CCaaS can be delivered through the Avaya Experience Platform (AXP) for customers who want a pure cloud solution. This is a solid juxtaposition for Genesys’s cut-the-cord approach, which forces its customers to move to the public cloud whether or not they are ready. While Avaya’s hybrid approach has kept them out of the MQ and may in future ones, it’s the right thing to do for its large enterprise customer base.
Bottom Line: CCaaS and AI
While the CCaaS MQ hasn’t seen many vendors move over the past several years, I expect that to change in future years. Artificial intelligence is the biggest catalyst for change since the introduction of cloud. Some vendors are partnering while others are building the capabilities in house. Which is better? Time will tell and I expect Gartner’s MQ to make AI a bigger part of the evaluation criteria.
One final note: although the MQ is a popular shortlist tool, it’s important to remember it’s not an absolute measure. Just because a vendor is more “right” or more “up” on the MQ doesn’t mean it’s the right solution for all companies. A business looking for a solution tightly bundled with UCaaS would likely be better off with 8×8 than NICE. Customers need to apply their own context and criteria to the vendors in the MQ to decide which fits their business best.