Podcast | Rewind and Forward on Programmable Communications – what to expect from pandemic-induced changes.

Jean
Shin

Director, Strategy & Content | Podcast Host of Mobile Interactions Now

25 min Podcast
Podcast | Rewind and Forward on Programmable Communications – what to expect from pandemic-induced changes.

In this episode, we check in with Alan Quayle, the founder of TADHack and TADSummit, who is also a renown communications industry analyst. We’ll be recapping what happened in the programmable communications space during the COVID-19 pandemic, and making predictions for what to expect in 2021 and beyond in terms of how businesses will use communications for their workforce and customers.

Jean:

Alan, Happy New Year and welcome to the show. And I'm so thrilled to have you as a big part of my sendoff to year 2020. I really wanted to do this. And I was so thrilled that you said yes. So I finally have you! The goal is to analyze a little bit, the industry changes we saw and take a little peek at the crystal ball you are looking at in your head and just kind of spread the knowledge. But before I get totally lost in that, I would love you to introduce yourself. We did a little intro in the beginning, but I am sure they would like to hear more from you.


Alan Quayle:

Excellent. Well, thank you so much, Jean, and a Happy New Year to you too. So a just quick introduction, my name, Alan Quayle. Engineering by training, but left that unfortunately a couple of decades ago. I worked on a whole range of things across programmable communications. So telecoms, programmable telecoms, if you want. What I do currently, sort of three things. I run TADHack, which is a global hackathon focused on innovation around programmable communications. That's about educating, helping people understand how powerful this is. We've made basically communications programmable. Anybody can use it.

There's TADSummit, which is where we get the smaller guys, not the big brands that do all their own marketing. We get the smaller guys together to share best practices and all the cool stuff you get from small innovators who are very close, both technically and from sales marketing perspective to where the market is. So you really get some amazing insights. You don't get corporate BS. In fact, we have as a policy for TADSummit, no BS.

And then I consult. So I help companies all around the world in understanding where the industry is going and helping them around creating plans and creating collateral and just connecting people together to help them grow and build new businesses and services.


Jean:

Now, let's do this. We just lived through year 2020. And basically every industry experienced some kind of crazy changes and programmable communications is not exception. I think it went through more accelerated changes. So, let's start with some low lights, highlights and take us there.


Alan Quayle:

Yeah, no, let me take you through a quick walk through of what we've been through. Now, I have to open up with just setting a few ground rules. A few ,basically sort of statements of the obvious, but because of all the industry analysts or cheerleaders, depending on your perspective, I do need to state these.

Remote working has existed for decades. Okay. So 2020 hasn't created some new remote working. It's existed. I've been remote working for 20 years now. It's just it's accelerated it, as you say, and a few more people have been doing it and a few more people have been hating it. Also, video conferencing has existed for decades, okay? It wasn't somehow magically invented by Zoom just before COVID hit. It's been around for a long time. It's just we've done more of it. And there's a lot more people that hate it as well. And I'll come back to why I'm highlighting that.

Also online conferences have existed for decades. And we've had a few more of them this year, but again, if they were really were that great, they would have been used a lot more in 2019. We had to use them in 2020 because of social distancing, basically you can't travel. But again, online conferences existed and guess what. People need to meet. They need to be able to focus. I just wanted to get that off my chest.

We do need to give a shout out to all the poor school children that have been remote learning on Zoom. It's been hell, because there's a whole host of practical issues. There's always some kid that doesn't bring their headset. So they're going basically hands-free and there's noise. There's basically volume level all over the place. There's also poor kids that are on crap internet. So they've got lag, they've got network issues. The patience the students need. Don't get me wrong, remote education can work for certain lessons. So if it's language, if it's more one-on-one, but as soon as you get to group lesson and it's music, it's appalling. I just watched my poor son trying to basically do band practice over Zoom. It's not good.

So anyway, I just wanted to sort of say that once we get the vaccine fully rolled out and we start to get back to sort of, we're not social distancing as much, we're going to see of these things disappear.

Let's focus now on what's happened last year. Zoom had IPO'd the year before, and people were going, "How is Zoom going to maintain 85% growth?" So January, people were questioning how these companies were going to maintain the multiples. Now, of course, Twilio, they're programmable communications. They cover sip trunking. They cover a whole host of workflows. The CPaaS label is completely wrong for Twilio. Twilio says that, but all the cheerleaders, sorry, analysts, keep calling them CPaaS anyway, I've always said CPaaS is a dopey categorization, but let's just remember that people were wondering how those companies were going to maintain the value.

 

Jean:

Just for the listeners who are not educated in the fine details between CPaaS and programmable communications, can you just set the record straight first?


Alan Quayle:

Yep. So programmable communications is the fact that telecoms communications is now programmable, generally open source based. You have a telecom app server and on that, you can build anything you want. You can expose a messaging API, you can expose a voice API. You can expose a video conferencing API. Zoom has an API on top of their platform so that you can integrate it into your service. We've seen through this year, a whole host of remote exercise, remote workout companies that have been built on top of Zoom. They use the Zoom API because conferencing isn't their business, their business is all about the workouts and the content management. There's an example of programmable communications. We've got all these unified communications, contact center is a service, as well as communication platform is a service. Companies that have appeared over the last decade, they are all programmable communications.

Let's look at companies like 8x8. They have UC, they have contact center, they have CPaaS. They have all these capabilities because they're built on a programmable communication platform. So the key is communications. It's now all just software that runs on the internet, on the customer's premises, in the enterprise data center. And it's all simply programmable. So that's the difference, in that CPaaS is an analyst defined term for a segment of programmable communications, it's a telecom app server that exposes generally voice to messaging APIs. But of course the world's far more complex than that. There's a ton of stuff you can do, like identity verification, like 2FA, like sip trunking, as an example. So it's an artificial definition, but when you use the term programmable communications, you're capturing a broader technology market trend where there's a lot more companies and it's a bigger number.


Jean:

And now let's get back to some of the highlights and low lights.


Alan Quayle:

So also in January, we've been consolidating now for a couple of years, but Enghouse bought Dialogic. We had Comcast, bought Blueface. So we had, and this is what you'll see running through the year, all this M and A and these sort of raises. A highlight for me was in February, we had TADHack Mini Phoenix, in-person. That was, I think you could sense there was a nervousness out of Avaya ENGAGE. Because it was in conjunction with a Avaya ENGAGE, but people still were like, "Well, maybe it'll be just like the flu." The numbers weren't clear yet. People knew there was this COVID thing, but, "Do we really need to worry about it?" And it was great fun, because not only did we have Avaya ENGAGE, we also had Google Dialogue Flow. And it was great. We just had a whole host of really cool hacks created on there.

Then March, I'm just trying to think, because this is when the lockdown started. So at the start of March, I was attending SimCom 3. And also I won a prize there for TADHack Global. So they recognized all the work that we'd be doing over TADHack over the years. But that really was my last flight. So March really was the shift. Because we had planned TADHack Mini Orlando just before Enterprise Connect. Enterprise Connect is a big enterprise communications event. That they decided, it's because they were trying to run it in person, but in the end decided not to, but because we're a hackathon and we've always had online and in-person components, we were like, "We'll just do it online." And we had a great event.

And I'll come back to, because I do want to highlight that. Because I want to talk about TADHack Global in October and the difference between the two. Because, you know, six months difference. In April, we saw Sinch buying Wavy. So we saw consolidation there as Sinch bought up Latin American business. Microsoft bought Affirmed Networks. They're more in the sort of programmable telecom space. 8x8 bought callstats.io. Verizon bought BlueJeans in the conferencing space. And Microsoft bought Metaswitch. So again, they're in this sort of programmable telecoms space. Then we started seeing some big numbers on raises. So Aircall, I remember when they started up in Paris, like five or six years ago now, built on top of Twilio. Raised 65 million at a 500 million valuation.

Matrix of course raised some cash as well. They're a open source project focused around think of it as federated enterprise communications. So no longer are you trapped in a Slack ecosystem or a Microsoft Teams ecosystem, you can use Matrix directly, or you can use Matrix to interconnect between different silos. So we actually use Matrix, or Elements as they're called now, at TADHack. So I can be chatting with people using Matrix, but I can also see all the conversations in different groups, for example, on Slack. So it's a great way of being able to have conversations across different messaging platforms.

Now, May we started to get hints that some companies were doing quite well under this lock down. So Twilio, Zoom, they hadn't published numbers but it was clear that they doing a lot of business. So Zoom in June published, and they showed year on year revenue growth of 169%. I mean, they were right time, right place. The team, Eric who founded Zoom, he'd be part of WebEx. So he founded the company that, Cisco bought and he saw the mistake they were making. Because they were taking a very enterprise approach to video conferencing. And he was like, "It's consumerization." Great experience, and just make it zero on-ramp. So teams within enterprises could just use it for free, see the value and then move up a staircase of commitment in terms of paying.This is web 2.0 principle, this isn't a new idea. You just basically give it away free, people see the value, and then they start buying because they see the value. And that's Zoom's proposition, and it became basically at term people use, to "Zoom," because guess what, they gave it away free to schools.


Jean:

Totally. I lived through it. Okay, here we are almost a year. And we're still home office-ing and home hacking, for your audience, and the industry is still moving. And I'm guessing part of it is because we are still learning what we need or what wasn't complete to begin with. So maybe we can kind of break this down a bit. Do you see any pattern in terms of what we are trying to complete here? Is it more internal, external facing channels coming together? What are you looking at?


Alan:

Yeah, so the key here is Amazon, Zoom, Twilio didn't plan for the pandemic. They had their business model and they were right time, right place. Zoom, particularly. So many of us were remote working maybe on a Friday afternoon or maybe when it was sort of coming up to vacation time. So remote working happened, it was just there was, not everybody but a lot of people were forced to do it in a more consistent, daily way.

And some people hate it. I work here in New Jersey. It's basically sort of greater New York City, really. It's just it's a different state. A lot of my neighbors work in New York City. They're not commuting even today. And they hate working from home. There's a whole variety of reasons. People are in a temporary situation. So the massive work from home, isn't creating a new normal.

You'll see people going back to the office at the end of this year and a lot more people going back in time when they realized that those that are in the office are getting the promotions. The ones that are working from home aren't, because they're not in the bosses face. Humans, humans need interaction, we're social creatures. And that social isn't fully replaced by a video conference. It isn't. It doesn't matter how you spin it. The reason in-person conferences work is because you're physically meeting people and you're away from the office. So your attention is focused on that event and those people. That's why conferences will still exist and be quite popular towards the end of this year. And back into 2022.

Where we are, the tools are generally inadequate. Conferencing sucks for classrooms. For music lessons it sucks really bad. And it's not just the technology, it's the human element. Because I'm in the office, I'm having to deal with a whole host of crap and there's a conference taking place, but it could be a message from Jean, and it's like, "Oh yeah, she's right. I need to respond to that." Well, this is a far more interesting to respond to than listening to this boring presentation. I get into doing that, I get doing some other emails, an hour and a half goes by I've given up listening to the conference.

We are going to go through a period of consolidation. So I gave you one example of contact centers that were in person. And then within a week had to become a less than. Virtual, that had to move to a contact center as a service solution. And it was done quick and dirty. It was a band-aid, we've got a whole host of pandemic band-aids over enterprise communication, over customer communication. And as we return to, basically businesses as usual, I believe by middle of 2022, most people, pandemic will be a dim, they'll even forget. "19, why was it called COVID-19?" You know, people will forget. It's human nature.

So I think that we'll see this year a rationalization. Because if you've moved your contact center, you put a band-aid on obviously SAS solution, that's enabled you to do something that maybe wouldn't have done, or would have maybe over three, four, five years you'd experiment. And because the contact center is working, why fix what isn't broken? This is how enterprises operate. But because of the pandemic, it forced you to move to a cloud-based solution and you saw that it works. It works reliably, gives me a lot more flexibility. Some of my employees enjoy it. They're still effective working from home. Some hate it and want to be back in the call center, but as they consolidate through this year, you'll see that the old contact center, the old sort of legacy contact center will be replaced through 2021, 2022.

Because it takes time. Because you got a whole migration plan. You've got all the data and the services that you've built up over the years in that contact center. And you're all of a sudden discovered, "Wow, I can actually have a dashboard bundled with this contact center as a service where my previous provider was wanting to charge me like a million dollars for integration to do this only channel sort of integration dashboard. But it's here, and it's bundled with a solution." So you're going to see a migration as the data gets taken from the legacy platforms and it gets put into the cloud platforms.

So something that would have taken a decade is essentially it's going to be three years. Because 2020 was the quick, dirty band-aid, forcing action that would never have happened in the first place. Then through 2021, '22 you'll see the migration that wouldn't necessarily have happened because it's not broken. Our contact center is working. Yes, it's a bit more efficient, whatever, but don't fix what isn't broken.


Jean:

If we were to see beyond the contact centers, what do you see?


Alan:

So moving more on to a lot of stores are open. What's been hard is food. So restaurants, and it depends regionally. I mean, some countries, generally led by women, that actually listened to science, have implemented protocols that have enabled restaurants to remain open. That have enabled a lot of industries to be relatively minor impact. So we've seen a lot of, especially here in my hometown, companies move the business online. So it's being able to, from their website, you can now order online.

If we look at within enterprise and employee communications, it's been an explosion of a patchwork quilt. There's the legacy sort of a UC solution or the legacy voice solution. Zoom's being patched in there, WebEx, Microsoft Teams, Slack, you just look at all the apps in a lot of employees sort of system trays on their laptops. It's a mess. Like the mess around sip trunking at SD-WAN simply so you can enable secure communication to the home because you've got employees with confidential information now being transmitted to the homes. And some of that will change as we move back to sort of normal. Because I know for some banks they're doing stuff that they're tolerating, but as soon as they got enough employees back in the office, that will be changing.


Jean:

You mean, rather than coming up with a different governing mechanism, you think it will just be a shadow technology and start going back to that old like…


Alan:

Oh no, it's more complex. You've got control human issues that are as dominant as technology. I think that we're in at the moment a raft of pandemic band-aids that have actually given some crazy growth numbers because people are adding in services while they're not getting rid of old services because they're just, "We got to get this working." A lot of growth has come come through band-aids, we're going to see a rationalization of those band-aids and using programmable communication to be more flexible in supporting whether you want to work from home or not. That maybe wasn't as flexible, but to be there to remind, working from home was a norm for many large businesses. In financial services people were in. Absolutely. But in some of the sort of more consumer oriented brands, I definitely saw some of the people that their car didn't leave their drive on Fridays because they weren't commuting in. You know, it was like, "I'm working from home on Fridays."

We've improved efficiency. This period will have enabled a more complete work experience. It's not revolutionizing things, it's just facilitated whether you're in the office or at home. More of the workflow, more of the processes you could do pretty easily as if you were in the office. I mean, it's been very interesting to look in some Asian countries at the massive volume of voice traffic that's still taking place. In Western markets, so let's use the UK. SIM would publish some numbers on voice traffic. So when the lockdown happened, initially it was a big spike in voice traffic. But then it actually sort of dropped and actually went below. Because guess what, people were using more online tools.

Well, in some Asian countries, voice jumped because what happened was they didn't have all the programmable communications. They didn't have all the cloud-based processes. So a lot of workflows had to move to voice. And the voice has continued, because guess what, people were making it happen. There'd be maybe sort of half the employees or quarter of the employees with the office, the rest were working from home and they were collaborating using voice. Yes, Zoom is the rest. But bear in mind that a lot of countries, internet access is not so good as to support sort of Zoom reliably. Yet, the voice calls just work. So you've seen people collaborate the way they've always have done by using just good old telecommunication. So I'll just draw that as one example. I think US, Western markets are on a slightly different trajectory and the diversity that we see in Asia will become even more diverse because of the pandemic.

Part 2 of the interview with Alan Quayle will be released in two weeks, following this release of Part 1.