VoiceSpeech IVR Market Update

Speech IVR Market Update

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VoiceXML expert and consultant Jonathan Eisenzopf provides a summary of
recent activity and trends in the speech IVR market.


Now that VoiceXML has been around and available for a couple
years, some industry watchers are probably wondering where things
are moving. Is this new speech IVR market segment healthy? Will
VoiceXML replace proprietary development environments? Will the incumbent
IVR vendors embrace speech and Web technologies? Is it safe to move
to a VoiceXML system now or should I wait for SALT?

Incumbent IVRs Will Support VoiceXML

Edify, InterVoice-Brite, Nortel Periphonics, Avaya Conversant and
Genesys all support VoiceXML in one form or another. The
common approach is to allow the IVR call-flow diagramming tools to
export the flows to VoiceXML. The VoiceXML output is processed by a
VoiceXML interpreter and uses the same low level software to manage
call-control as is used by the proprietary languages. This satisfies
the needs of existing customers who are looking to migrate
applications to VoiceXML and also provides an outlet for new
customers to deploy VoiceXML applications using an established

Incumbent IVR VoiceXML Support Still Immature

While the incumbent IVR vendors have more experience and history
in the marketplace, VoiceXML and speech recognition are still
relatively new technologies for these companies compared to the old
reliable touch-tone standard. Some IVR vendors are just now testing
the waters with VoiceXML support.

With the exception of IBM, the VoiceXML implementations offered
by the incumbent IVR vendors I mentioned above have only been made
available to customers at the end of the 2nd and beginning of the
3rd quarter of 2002. There are few, if any, customers using these
new implementations. Additionally, there will likely be some issues with
the first versions of these VoiceXML browsers that products such as
Voice Genie, IBM Voice Server and Nuance Voice Web Server have
already shaken out near the end of 2001 and the beginning of 2002.

If you need a VoiceXML platform now, I would recommend looking to
one of the newer speech IVR companies or IBM, as they have more
experience with speech. If you already have an IVR system from one
of the incumbents and you can wait six months to a year for them to
ramp up to full speech IVR support, I would recommend giving them a
call to see if you can evaluate their VoiceXML functionality over
the next few months to determine whether an upgrade would be
beneficial for your organization.

VoiceXML Still Seen as Immature

Some IVR programmers and salespeople that I’ve talked with still
see VoiceXML as an immature technology and are relaying the same
message to their customers. There does seem to be interest from
customers in VoiceXML and speech recognition which is driving
vendors to adopt the new technology.

The Rift Between Telephony, Speech Recognition, and the Web is
Still Gaping

VoiceXML brings together three distinct technologies (telephony,
speech recognition, and Web) that have communities of technologists
and practitioners which have traditionally stayed apart. These
groups are now coming together in VoiceXML and there is quite a bit
of clashing and difference of opinion based on each groups’
background experience. I think this clash will go on for a while,
but the result will be a new breed of practitioner that understands
the range of technologies and issues that relate to each of the
three technology practices.

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
  • 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

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

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