Virtual Call Center

Looking to further its commitment to the cloud services space, bulk up its client base, and address the voice and video communications and call center needs of SMBs and enterprises, 8X8 last month put a nice bow on its four-year collaborative relationship with Contactual (News - Alert) by acquiring the cloud-based services company.

But what exactly drove this acquisition, and why was it important for 8X8 to bring an all-new call center product to its already robust portfolio? Apparently, a “paradigm shift” being created by the channels, according to Kim Niederman, senior vice president of Worldwide Sales for 8X8.

At last month’s ITEXPO (News - Alert) West in Austin, Texas, around the same time 8X8 closed the Contactual deal, Niederman took a few moments to sit down with TMC’s own Erik Linask to discuss the acquisition, as well as this so-called “paradigm shift.”

As the only public cloud-based company, 8X8 was looking to acquire another company that specialized in call center services. A premier company in that area, Contactual was the perfect fit since Contactual sells numerous services much in the same way that 8X8 does, said Niederman.

“The channels are creating a ‘paradigm shift’ at this point, and it’s important to understand that they need to be able to sell a suite of services, and currently the channels aren’t able to do that because a lot are sold direct,” Niederman explained. “For instance, people like Rackspace (News - Alert) and Salesforce.com that sell products direct to the end-user, the channels get cut out. Contactual call centers is one of those technologies that gets sold the same way, and what 8X8 is going out doing is selling numerous services, including Contactual, to the channels, allowing them to sell to end-users.”

When referring to this paradigm shift, Niederman blatantly means the ongoing shift to the cloud. “Channels currently make the most of their money upfront selling hardware,” he said. “But, services going to the cloud have to figure out a way to sell services. The problem with this is they can’t get enough money upfront to match what they get in hardware. 8X8 is the first company to offer the channel that earns as much money or more money upfront in services than the channel can get in the cloud. In addition, we offer residuals on the back-end, which is three-and-a-half to four times as much as they can make in revenue services.”

When asked why it was important for 8X8 to add the call center product to its suite, Niederman replied, “We went to the SMB market, which had four strategic markets important to them: VoIP, video, virtual hosting, and call centers. Other services will come along… but these are the four key ones we identified for the SMB market.”

As for the SMBS, they now get to reap the benefits of products on demand, which allows them to reduce or increase services to match their needs.

According to Niederman, acquiring, rather than partnering with, Contactual has added value to the company, and will enable 8X8 to perform integration better, and even lower prices, since 8X8 will no longer have to pay a service fee.

Meanwhile, even as a provider of primarily VoIP and PBX (News - Alert) services, 8X8 is experiencing a surge in demand for video, as well as hosted and contact center services.

“We’ve had great reception, and the channels really understand that they can make a lot of money with cloud services. So this is just the beginning,” he said.

Tammy Wolf is a TMCnet web editor. She covers a wide range of topics, including IP communications and information technology. To read more of her articles, please visit her columnist page.

Edited by Juliana Kenny