I recently attended Enterprise Connect, a significant industry conference covering contact centers, customer experience (CX) and telephony. I wrote my initial coverage here. Now, a few weeks later, I’d like to offer some thoughts about what my observations mean and where the industry goes from here.
I’ve been covering this industry for 36 years, as a journalist and an analyst. Decades of
One way I approach large conferences like this is to start with a set of assumptions about what I will see and what people will say, and then repeatedly pose those as questions to each company I meet with. Perhaps you’ll see the problem when I tell you the questions.
“Let’s look ahead to 2028 or 2030. Paint me a picture of what the industry—what CX—looks like, and of your company’s role in that future.”
That’s not a very hard one, amiright? In fact, it’s pretty much a softball designed to let anyone put forward the standard messaging points that every company usually refines in advance of public gatherings: The future will be bright, profitable, our customers will be on the cutting edge, their customers will be reaping amazing benefits, we are positioned to leverage this change and so on. That’s where we usually land, and then a discussion begins about the particulars, and I as an outsider can weigh whether I think they’re right, wrong or pretending. Here is the answer I got across the board: “…”
Crickets. Hardly anyone wanted to engage in a discussion about consequences, about what happens to enterprises downstream of the latest technology adoption or about what happens to providers if those enterprises lag adoption. In one case, an executive at a Contact Center as a Service (CCaaS) provider (who should have known better) said to me: “Well, we have a new CEO, so I’m going to wait for him to set his agenda before saying anything.” Good soldier, poor communicator.
Here’s another stumper I asked around: “If agentic AI involves many times the token consumption of GenAI, and you want to sell enterprises agentic tools, how do you give buyers enough clarity into pricing that they can make plans for two, three, five years down the road and feel comfortable making deep operational changes as a result?”
Answers varied, but most came down to an acknowledgement that pricing is not clear, that different models are in play and that only time will tell what makes the most sense for all parties involved. Some people did acknowledge the idea that transforming contact centers into enterprise CX operations is a high-risk/high-reward kind of action, meaning that pricing clarity might be something everyone can downplay for the time being while anticipating serious efficiency and cost-saving benefits.
In the meantime, very few people or companies want to discuss what happens when the enormous investments in AI development at the large language model (LLM) labs and the downstream investments by CX companies in creating complex agentic systems all have to be monetized into profits, and who will absorb the costs of those investments. The people who had the hardest time discussing this issue were those at legacy CCaaS companies, which brings me to the third question I trotted out.
“What is the role of CCaaS (as a product, platform or foundational element of a tech stack) in a world where hyperscalers, CRMs and others can control the contact center interaction machine?”
People—especially those in product management—are more prepared for this question. It speaks to the existential crisis in many of their companies, so they sometimes have clear insights into things like the essential nature of the voice channel, the mission criticality of the interaction and how CCaaS has been updated to reflect new realities in omnichannel service, customer analytics and the role of AI in boosting center performance.
I think responses from CCaaS providers about the essential need for (and permanence of) CCaaS as a way of organizing a CX stack are genuine, and partly correct. But they depend largely on which company is making the claim. Legacy contact center companies of size, with deep partnership networks and resources devoted to moving beyond interactions towards analysis and orchestration, will persist. For smaller companies fighting a losing battle to develop AI applications with limited resources, whose backgrounds largely come from managing telephony in a business phone system context, their assertions about their long-term prospects as CCaaS providers are, I think, aspirational at best.
Where does this leave us? I’m a pragmatic person, so I know that the inferences we can take from one trade show are tentative at best. But I believe we’re seeing what happens when an entire industry shifts its fundamental toolset out from under a user base that is trained to be risk averse. This user base has a decades-long understanding of the relationship between the products they deploy, the cost structures they work with and the outcomes they can expect. The tension between the old and new models for running service operations is profound. And while we can acknowledge that the tools will produce benefits, we also have to admit that, collectively, the industry has been much more focused on playing defense against itself and its new entrants than on explaining clearly to buyers exactly what is coming, why it will be better and how to transition from one call center model to another.
And the answers to my fourth question—“What business problem does this solve?”—were usually so mangled and convoluted that I’m not surprised that buyers were thin on the ground at Enterprise Connect.
We seem to have arrived at a point where software providers are a bit disconnected from the needs of their buyers, or at least from the daily realities of making the needed operational transitions to new tech and tools. That isn’t helpful for either side of that dialogue. Buyers should expect a rocky next few years as the industry experiments with different pricing mechanisms and technology continues to race forward. I suspect providers will land on some form of usage-based pricing, either around tokens or some other easy measure, not on outcome-based or the traditional seat model. It’s in buyers’ interest to scrutinize—and fully understand—each software provider’s pricing, with attention to how advanced AI features are packaged with (or without) standard contact center tools. It’s not that the providers are being sneaky; many truly do not understand how best to structure their offerings and are working through the problem as they go.
Enterprises need to demand clear answers to the fourth question: what business problem is being solved. If a software provider can’t articulate the problem (let alone the solution) in one clear paragraph, then something’s gone wrong in the buyer/seller communication relationship. My take? The business problem writ large is that enterprises are being asked to turn their old-model service operations from interaction machines into profit- and growth-oriented engines, but without clear guidance for what that should look like in terms of outlays, employee relationships and integrating new tools into operations. So, if you’re an enterprise buyer, judge providers by their ability to describe a realistic future state for your service ops. We’re in for a wild ride over the next year or two.
Regards,
Keith Dawson