Being able to compete on equal footing with contact center giants is important as the customer contact market shifts to longer purchase cycles driven by the need for technology refresh, rather than hordes of startups demanding quick solutions.
Posted Sep 9, 2004
Concerto Software has aggressively expanded its high-end product line by purchasing the FirstPoint Contact solution from Rockwell Automation. Widely hailed as the first automatic call distribution system, FirstPoint Contact was originally developed for Continental Airlines in the 1970s. FirstPoint Contact has been one of the pillars of the inbound contact-center business for some time, and the opportunity to add it to the Concerto mix proved too good to ignore.
"The thing we absolutely needed to achieve was to elevate our credibility in the inbound part of the contact center space, which is the larger and more rapidly growing part of the market," says Concerto CEO Jim Foy. Concerto had some inbound capabilities, but the company is more commonly associated with outbound customer contact. Foy says that for Concerto to "grow at the rate we want to grow and achieve a dominant position by organic growth alone would take too long. We needed to accelerate that process, and we have done that with the acquisition of Rockwell [FirstPoint Contact.]"
Being able to compete on equal footing with contact center giants is important as the customer contact market shifts to longer purchase cycles driven by the need for technology refresh, rather than hordes of startups demanding quick solutions. "Increasingly, as the North American and western European market matures, that's the [model]: system replacement rather than net-new opportunities," says Drew Kraus, principal analyst at Gartner. Enterprises with a complete contact center solution to replace have less patience for assembling best-of-breed solutions from different vendors, according to Kraus, creating a pressing need for Concerto to be able to provide a drop-in replacement for major contact center systems.
Concerto has been active in the mergers-and-acquisitions department recently. FirstPoint is Concerto's second acquisition in just over a month, and Concerto itself was taken private earlier this year by investment firms Golden Gate Capital and Oak Investment Partners, which participated in the FirstPoint Contact purchase. "The venture capitalists have been taking a fairly aggressive growth strategy, and I have a hunch their acquisitions are not over with," Kraus says.
As for Rockwell exiting a category it helped to create, the writing has been on the wall for some time. Rockwell made open attempts to sell the unit during the 1990s, so the move was expected by industry watchers. "This was a business that was marginally profitable to the larger Rockwell...basically, they just saw it as an ancillary business that didn't make a whole lot of sense to be in," Kraus says. "This really isn't much of a surprise, but it is interesting to see who picked it up."
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