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Sound advice: save with voice

Jupiter research focuses on call center efficiencies

by seamus mcateer
May/June 2001

The prevailing wisdom guiding investments in new technologies throughout the bull market was that nothing succeeds like momentum. The new lesson being taught by the bear market is that market acceptance often fails to match the instincts of the herd.

Automated speech recognition, or ASR, has had momentum: Voice XML, public offerings by Nuance and Speechworks, and the launch of dozens of new self-styled voice portals and speech ASPs have drawn attention to the sector.

Does all this mean a market exists for speech services? It depends on the application.

Successful early deployments of ASR focused on automating and extending customer service. Nuance’s first major deployment, for example, was an automated brokerage service for Schwab that allowed customers to access information about specific stocks. Speech recognition initially will find use in spot customer care applications and will become widespread as a touch tone replacement in about two years as companies become willing to make major changes to enterprise telephony systems.

Jupiter Research has built models to show the expected cost savings from deploying ASR technology in a call center environment. The analysis shows that enterprises can derive substantial savings–up to 18 percent– for those handling the largest volume. The extent of these savings will depend on the size of the cost center and whether ASR is deployed in-house or outsourced to a service provider. Jupiter advises most medium- and large-sized call centers that handle in excess of 100,000 calls each month to consider in-house integration as the costs of these systems are amortized over this larger volume.

A new class of services launched in 2000 as Tellme, Quack, HeyAnita and BeVocal, along with a host of others, sought to offer a similar range of information services under a single brand. As the market for interactive advertising spiraled downward, these self-termed voice portals speedily refocused as specialists in ASR-hosting and providers of services to telcos. Jupiter contends that voice portals face a stiff challenge. By trying to be many things to all people these services face a difficult time articulating a clear marketing message and building brands with a distinct promise.

Initiatives by AOL, which acquired Quack, and other Web portals to build ad- or fee-supported extensions to their services miss the mark. The primary selling feature of these services is the ability to access e-mail and other personal information via phone. But aural, linear delivery using text-to-speech technology is a substandard way to access lengthy text messages.

AOL should listen to its Moviefone division for advice. Moviefone’s 777-FILM service provides a model for successful implementation and is the most successful consumer-focused telephony service. The brand promise is focused and, because it drives transactions, Moviefone can command ad revenues in the $100 per thousand impressions range.

In the near to medium term, investments in the ASR market should focus on finding technologies and solutions that support spot services, not on building general platforms, and successful companies should view ASR as a means to build new telephony applications rather than as a mechanism to extend the Internet.

Seamus McAteer is an analyst with Jupiter Research.