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NICE Acquisition of inContact Caps Call Center Industry Transformation

Every decade or so, the contact center industry goes through transformative cycle. Innovative new point solutions arise to solve a different contact center pain point debut, and as they often offer new capabilities, they garner a lot of attention. In the meantime, the largest companies in the contact center space experience some organic growth, but they also keep their eye out for sharp new features. Oftentimes, the larger companies acquire the smaller companies, and add new technology to their fully featured contact center platforms. After a storm of acquisitions, the industry settles down again to grow and nurture new startups, and the cycle begins all over again.

The most recent high-profile acquisition has been that of cloud contact solutions provider inContact by customer service analytics giant NICE. With the integration of inContact into its portfolio, NICE will now be able to offer customers a comprehensive suite of customer service essentials, from automatic call distribution and workforce optimization to the company’s flagship advanced analytics-based applications. Together, the two companies will be able to serve the fast-growing contact center-as-a-service market that promises to meet nearly all the needs of customer support organizations without the need to integrate a series of point solutions from different vendors.

Barak Eilam (News - Alert), CEO of NICE, noted that in combination, NICE and inContact are “re-inventing customer service as we know it” by transforming the legacy contact center into a sort of “customer experience center.” The combined organization will be the first vendor to offer both contact center cloud infrastructure as well as a full range of workforce optimization applications and analytics

Contact centers have had to make radical changes in recent years. Customers are no longer content to be a series of transactions in various contact media that intersect. Instead, they want a holistic relationship with a company that will enable them to seek out the fastest and most personalized answer possible in a series of communications channels of their choice – voice, social media, mobile app, self-service and Web – even if they switch channels in the same transaction (which they often do). Point solutions have been unable to meet these needs, as integration has meant limitations to how omnichannel customer support organizations could get.

Full-featured contact center in the cloud can help organizations of all sizes meet these omnichannel, personalized customer expectations. When they’re underpinned by strong analytics technology – which NICE already has -- today’s contact center solutions can become extremely smart, helping agents offer the best possible customer experience to each individual customer based on past behavior and behavior predictions.

NICE is acquiring inContact for $14 per share in cash, which has led to valuation of inContact at approximately $940 million, including repayment of inContact’s outstanding convertible debt and excluding inContact cash on hand. NICE has said that it plans to finance the acquisition with cash on hand as well as debt of up to $475 million. In addition to the merger of the products, NICE will benefit hugely from access to inContact’s customers, according to some analysts.

“This acquisition will bring inContact clients to join NICE client portfolio and provide the company with the opportunity to present these businesses with an overview of its broader set of offerings, including voice of the customer and customer engagement analytics,” wrote Aberdeen Group’s Omer Minkara.

Keith Dawson (News - Alert), writing for Ovum, contrasted the way NICE has handled its acquisitions in comparison to how Verint (News - Alert), a close competitor, has handled theirs.

“Verint bet the farm on CRM and service tracking by acquiring Kana two years ago,” wrote Dawson. “NICE has now shown its hand and bet on both cloud and routing platforms. Cloud routing, along with analytics, is the fastest growing segment of the contact center technology industry. Niche no longer, NICE is now in the same league with Avaya, Genesys (News - Alert), Aspect, and Interactive Intelligence.”

Paul Jarman, CEO of inContact, will be joining the NICE family, according to the two companies.

Edited by Maurice Nagle