Microsoft and Nuance Get Muted By Gartner Magic Quadrant for IVR

When it comes to the Interactive Voice Response (IVR) market, the word on the street is easily recognized: The market continues its shift toward standards-based platforms, and toward adoption of VoiceXML as the de facto programming language -- and most of the players in the field are reciting the same old dialogue, according to industry research firm Gartner's "Magic Quadrant for Interactive Voice Response Systems and Enterprise Voice Portals, 2008."

But while there are no monumental shifts in market direction, there are several changes in personnel among this year's lineup, according to Steve Cramoysan, a Gartner research director and co-author of the report. "The main, obvious differences are the new entrants that we considered this year, and those who have fallen off the chart," he says. And the two dropped vendors are hardly unknowns: Microsoft, with its Speech Server product, and Nuance Communications, with its Voice Platform offering.

Cramoysan says neither of these exits surprised him, and both deletions were being considered even before last year's report was published. "It crossed my mind to strike them off [the Magic Quadrant] the year before, but the evidence wasn't strong enough to do that," he explains.

This year, he says, the jury came back with a verdict: In the case of Microsoft's Speech Server, Cramoysan cites a less-mature platform and a lack of go-to-market channels to hit the "sweet spot of the IVR market" -- the contact center. "It's not particularly, at this stage, well placed to address the contact center market," Cramoysan says. "This was to some extent visible a year before, but we gave it a year to see how that would play out. After another year of seeing a lot of evidence showing they're not really in the market we're trying to track here—we took them out." As if to make Gartner's decision easier, he says, Microsoft rolled its speech team into its Unified Communications (UC) team, and speech technologies are now a part of the overall UC solution.

Nuance's removal from the Magic Quadrant is largely because the company has "mothballed" Nuance Voice Platform (NVP), Cramoysan says. While existing customers continue to receive support for NVP, the company has stopped offering the platform to prospective customers because of "channel conflict with primary go-to-market partners," he says. "Taking Nuance off the chart this year was the logical thing to do," he adds.

Aside from the removal of Microsoft and Nuance, there was no noteworthy movement or shift among companies this year -- and Cramoysan doesn't expect any in the immediate future. Aspect Software, for example, remains the only company to land in the Challengers Quadrant, missing out on the Leaders Quadrant due to a perceived lack of completeness of vision.

Meanwhile, the vendors that did make it into the Leaders Quadrant—which, according to the report, comprises those companies improving integration between voice self-service and live-agent functions while reducing the complexity of both developing and operating solutions—include:

• Genesys Telecommunications Laboratories, which outscored all other vendors in both completeness of vision and ability to execute;
• Avaya;
• Intervoice;
• Cisco Systems; and
• Nortel Networks.

The exit of two vendors from this year's report was matched by the introduction of two newcomers, both in the Visionaries Quadrant—Holly Connects and Voxeo. Both companies, according to Cramoysan, "are interesting, and have a different approach to a solution, and give our clients alternative choices." The report states that both vendors offer a software-only platform that meets diverse needs in an enterprise, macthing a trend in the market for software-based platforms. The other vendor in the Visionaries Quadrant is Envox Worldwide.
The Niche Players Quadrant this year comprises the following trio of vendors:

• IBM;
• Syntellect; and
• Interactive Intelligence, which came in last among all included vendors in terms of both completeness of vision and ability to execute.

Cramoysan says that while the IVR market continues to shift toward VoiceXML, as well as standards-based and software-based platforms, UC is starting to emerge as another long-term trend. "Over time, [UC] will reshape the architecture of enterprise communication and enterprise communication solutions," he predicts. "Part of that will be that the IVR platform will evolve into a media server platform, with corresponding application logic that could fit on the same platform or fit on a separate server elsewhere. [The application logic would] basically provide the intelligence for how calls should be routed, how they should be treated, and [will] knit [those calls] with other channels of interaction so that customers and organizations will get a uniform experience."