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April 05, 2006

Alcatels Genesys to Acquire VoiceGenie to Bolster Self-Service Market Segment

By Robert Liu, Executive Editor

Amid the quickly consolidating Interactive Voice Response (IVR) market, Alcatel (News - Alert) said its Genesys (News - Alert) Telecommunications Laboratories subsidiary has entered into a letter of intent to acquire privately held VoiceGenie, a leading provider of voice self-service solutions based on the VoiceXML standard.
The deal represents the first time in nearly four years that Genesys Labs, a leader along with Avaya (News - Alert) and Cisco Systems (News - Alert) in the large-scale enterprise call center market, has resorted to an acquisition strategy to jumpstart technological development. In May 2002, the Alcatel company acquired Telera for $136 million for its VoiceXML knowhow – considered vital at the time as customers and vendors left and right were beginning to switch out of proprietary solutions. Genesys also made an acquisition earlier in January but that deal was done more for geographic expansion.
For the quickly consolidating IVR market, the deal further reinforces the notion that IVR companies are facing increasing pressure from customers and competitors to go it alone. In the last 12 months, Intervoice followed through on its November announcement to acquire Edify for $33.5 million in cash from S1 Corporation; ScanSoft scooped up Nuance; TuVox acquired NetByTel; and Aspect Communications merged with Concerto Software.
Looking purely on the fundamentals, VoiceGenie represents a valuable acquisition for any customer premises equipment-based (CPE) vendor of Genesys’ size and scale. In its 2005 Magic Quadrant report examining the IVR and enterprise voice portal segments, Gartner cited VoiceGenie as a visionary but also noted that it lacked the ability to execute.
“The increased adoption of speech recognition provides a strong driver for companies to replace aging proprietary IVR systems with the standards-based voice portal systems,” Gartner Analyst Drew Kraus wrote in a recent report. “In addition, vendors announced end-of-life plans for their proprietary IVR systems, causing some companies to accelerate their plans to replace these systems.”
Terms of the transaction weren’t disclosed other than to say it was financed purely with cash. Headquartered in Toronto, VoiceGenie currently has 90 employees and serves some of the largest carriers and application service providers (ASPs) as customers including Verizon, AT&T (News - Alert), and Orange of Europe.
The deal is expected to close in a few weeks. A conference call is scheduled for later this afternoon. Undoubtedly, more details will be forthcoming shortly.
Robert Liu is Executive Editor at TMCnet. Previously, he was Executive Editor at Jupitermedia and has also written for CNN, A&E, Dow Jones and Bloomberg. For more articles, please visit Robert Liu's columnist page.

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