Zoom-Five9 deal to offer all-in-one cloud contact center

Businesses increasingly want one vendor to meet their UC and contact center needs from the cloud. Zoom's $14.7 billion acquisition of Five9 would add the video conferencing company's name to that supplier list.

Businesses turn to cloud-based contact center software to serve customers and give employees working from home access to customer data. Zoom responded to that trend by announcing plans to acquire contact center as a service (CCaaS) company Five9 in the first half of next year.

Colin Taylor, CEO of contact-center consulting firm The Taylor Reach Group, said the COVID-19 pandemic forced call centers to let agents work from home. As the cloud makes connectivity with home-based employees easier, this accelerated a migration that was already taking place.

"Of the projects we get involved with … 95% of the time, it's a cloud-based solution instead of a premise-based solution," he said.

Taylor added that he expects a significant percentage of centers to adopt hybrid work, bringing agents into the office only for things like training and reinforcing company culture.

Joe Fizor, an engineer at tech reseller Telecom Brokerage Inc., said only one of his firm's customers requested a premise-based contact center system in the past 18 months. He said customers were motivated by the advantages of the cloud, including integration with CRM products and the ability to accommodate remote workers.

"Premise-based systems are very much a thing of the past," he said.

Still, there is a large market of contact centers that have not moved to the cloud. Forrester Research analyst Art Schoeller said only about 25% of the contact center industry is cloud-based. The combination of Zoom and Five9 could appeal to that remaining 75%, he said.

"There's plenty of room and plenty of momentum right now," he said.

In general, contact center companies want a single vendor for both UCaaS and CCaaS. Taylor said vendors without a combined offering are at a disadvantage. Without a UCaaS product, Five9 had to partner with other firms or lose out on business.

"In one specific project we worked on, [Five9 was] excluded for that reason," he said.

Fizor said companies often choose a single vendor for UCaaS and CCaaS for logistical purposes. It reduces time spent getting multiple vendors' products working together and simplifies paying for the services.

"If we can consolidate billing, it immediately wins brownie points in the customer's eyes," he said.

With strong name-brand recognition for Zoom and Five9, the combined company should attract customers, Fizor said.

"They're just going to be a monster to deal with now," he said.

Mike Gleason is a reporter covering unified communications and collaboration tools. He previously covered communities in the MetroWest region of Massachusetts for the Milford Daily News, Walpole Times, Sharon Advocate and Medfield Press. He has also worked for newspapers in central Massachusetts and southwestern Vermont and served as a local editor for Patch. He can be found on Twitter at @MGleason_TT.