“How is Communications as a Service different from traditional hosted services?”

This blog entry was posted by Ed Margulies, Senior Director, Product Management CRM Service Products at Oracle. Margulies is a telecommunications architect, usability expert, inventor, and the author of 17 books on telecommunications, contact centers and service automation. The views expressed in this blog are Margulies’ and do not necessarily reflect the views of Oracle.

A Common Thread

As a product manager in Oracle’s CRM Service Products team, I get to work with many companies worldwide that are honing the definition of CaaS and are continually innovating in this area. I view CaaS as a natural evolution of traditional hosted services. CaaS has its roots in enhanced network services reaching back into the 1970s and 80s. The differences between the two are not as stark as you may think, and there are also some similarities.

The common thread between CaaS and traditional hosted services is the idea of software as a shared resource. At the bottom are algorithms, codecs, and device drivers. In the middle are databases, APIs and resource management. At the top are applications. What is truly exciting is we are evolving from closed, proprietary networks into a world of open, API-hook-able networks.

An Enduring Model

You can get a hosted services provider to dedicate a “pod” of gear and software for you. This type of outsourced service amounts to labor arbitrage and the care and feeding of servers. But the true economy of scale kicks-in when this is done in a multi-tenant arrangement – so customers who heretofore were not able to contemplate the use of that software – for want of capital or know-how – are suddenly empowered. And that empowerment is enabled by the sharing of infrastructure thus making it more affordable. That’s what makes hosting, in general, such an enduring and credible model. That is the “hope” that even a small or medium sized company can take advantage of technology reserved for large corporations.

This hosted, shared software model cleared the way for many services. Among them are the oft-touted EDS on line “mainframe sharing” services offered by Ross Perot. Also consider payment processing and credit card clearing houses like National Data Corporation – or the pioneering efforts of First Data Resources in providing outsourced back-end Pay-Per-View statements for cable companies.

The Differences

So what’s the difference between these traditional hosted services and CaaS? Well, most of these older hosted efforts were nonetheless outsourced back-end services – not strictly communications-based. In fact most of them were machines talking to machines. When you bring these services into the realm of communications, four additional disciplines are at play: 1) Media manipulation and routing, 2) Presence Management, 3) Ubiquitous device management, and 4) Remote user registry management.

Back to the Future

One of my favorite examples of how these “new” disciplines were explored hails from a project called MICE (Modular Integrated Communications Environment). It had its roots at AT&T and was finally developed as a proof-of-concept at Bell Communications Research (now Telcordia) in the early eighties. I was involved as an OEM supplier of voice processing subsystems built by Voicetek. Other suppliers were Digital Equipment Corp (DECtalk text-to-speech), Redcom (Outboard state controlled switch) and some other speech processing elements. The MICE system was essentially a personal assistant / follow me / multi-channel hosted communications platform. What did it do? It read your email for you and delivered it to you via Text-To-Speech over the phone. It provided presence information to other users. It allowed callers to “find” you by using a registry and mapping service to different communications devices. It allowed you to change locations and create what we now call a “virtual office.” It rocked. But the Regional Bell Operating companies didn’t bite. Sadly, it was ahead of its time.

Ten years later, in the mid nineties, companies like Wildfire (now part of Virtuosity) took that basic concept a step further by contemplating more sophisticated speech recognition technology and launching a commercial service. And that service was touted as a computerized personal assistant that you could talk to make appointments, calls, look up contacts, etc. I recall the excitement in the air as Bill Warner and Richard Miner, the creators of the application; did “live without a net” demos of Wildfire at popular telecom shows of the day.

The Perfect Marriage

But now with Web 2.0 and beyond, we are moving these capabilities – grounded in the temporal domain – into a converged temporal and spatial domain. A richer set of media is now common, and communications “cockpits” and edge applications give users more intuitive control. Now, CaaS transcends a variety of user bases in personal productivity, social apps and even the contact center. Take, for example Oracle’s CRM On Demand. Here, remote users can control sophisticated CRM transactions – including interwoven voice and email – all within one interface.

In summary, the similarities between CaaS and traditional hosted services are about a sense of shared software resources. And the big difference is how CaaS addresses the human element more than traditional hosting services. With CaaS we add more people and real-time urgency to the mix. So CaaS is more about collaboration and people reaching out to other people aided by machines - not just about machines talking to machines. The ratio of people to machines is much higher in new CaaS applications than ever before. I hope it never goes back the other way.

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The Communications as a Service (CaaS) blog covers industry trends, strategies, best practices and innovations in subscription-based enhanced communications services. CaaS takes in everything from hosted virtual contact centers, Interactive Voice Response (IVR), multi-channel enabled self service, Voice 2.0, and communications-centric social apps.

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