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Speech IVR Market Update

  • October 9, 2002
  • By Jonathan Eisenzopf
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Customers "Get" the VoiceXML Value

Customers are pretty smart about the benefits of VoiceXML. Some of the benefits from a customer's point of view are:

  • We can use our preferred programming languages to write IVR applications
  • VoiceXML is relatively easy to learn
  • We don't have to duplicate code for the IVR to use our business logic. We can re-use our client/server and Web logic using the same code and application servers.

One of the benefits that customers expect (but don't get) from VoiceXML is that they can port their applications from one platform to another without much work. Unfortunately, I have to explain to customers that while VoiceXML is a standard, not all vendors support all the elements in the same way; and there are certain features like grammars and call control that are still not standardized in the commercially available VoiceXML implementations.

Speech IVR Market is Growing (Slowly)

The IVR market as a whole will not see much growth in 2002. There will be some growth in the speech IVR market, but I don't expect that it will be more than a few percentage points more than 2001. Many companies that are looking at upgrading their IVR systems are considering speech recognition and VoiceXML as an option.

One growth area that could develop towards the end of 2002 is offerings that are targeted at the small- to medium-sized business market. For example, Angel.com, owned by business intelligence software maker Micro Strategy, allows businesses to create hosted speech IVR applications using a tool that is simple enough for non-programmers to use. What makes this type of solution interesting is that smaller businesses that might not have been able to afford a PBX with an auto attendant feature can now afford a hosted solution that uses speech recognition for a low monthly fee plus a per-minute rate.

Don't Wait for SALT

Many are still wondering whether they should wait for Microsoft and other vendors to provide SALT instead of using VoiceXML. My advise would be, if you want to implement a speech IVR in the next year, don't bother waiting. It will take that long for vendors to release SALT support and there isn't a clear advantage in SALT over VoiceXML for developing a speech IVR system.

Top Speech IVR Vendors

While my list of recommended speech IVR vendors will likely change as incumbent IVR companies improve their VoiceXML support, the only incumbent that I've spoken with (other than IBM) that is aggressively marketing and supporting its VoiceXML capability and also has speech recognition experience is InterVoice-Brite. So my top 6 vendor picks for the 3rd quarter of 2002 are (in no particular order:

  • Nuance
  • Voice Genie
  • IBM
  • InterVoice-Brite
  • Genesys
  • General Magic


To summarize:

  • VoiceXML and speech recognition are being slowly adopted by vendors and customers.
  • I still believe that speech recognition and VoiceXML will slowly replace touch-tone IVRs. 
  • While the growth of speech recognition and VoiceXML in 2002 will continue to be slow, it will be steady.
  • Incumbent IVR vendors are introducing better VoiceXML and speech recognition support into their products.
  • Only a few of the new speech IVR companies will be able to maintain their market share as the incumbent IVR vendors strengthen their VoiceXML and speech recognition support.
  • There could be growth in the small to medium sized market if companies like Angel.com are able to offer pre-packaged applications that work better and are cheaper than on-premises systems.

About Jonathan Eisenzopf

Jonathan is a member of the Ferrum Group, LLC  which specializes in Voice Web consulting and training. Feel free to send an email to eisen@ferrumgroup.com regarding questions or comments about this or any article, or for more information about training and consulting services.

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