How will Avaya spend its $300m investment kitty?

At Avaya’s first Engage event post chapter 11, you could almost see the weight lifted from CEO Jim Chirico’s shoulders.

He talked about how, for the first time in years, Avaya no longer has to drive ‘with the brakes on’. He also reminded the audience that debt restructuring has added an extra $300m a year to the coffers.

What’s more, he’s determined to spend it.

“People know me as the ‘chief restructuring guy,” he said. “But no one wants to spend money more than me. Trust me, I did that job for far too long.”

So where will the money go? And what new directions will the company pursue?

We’ve been thinking about it. Here are six things we reckon Avaya will do in 2018.

1. Crack the SME cloud market

Avaya has made a ton of progress in software and services (which is now 80 per cent of its revenues). It clearly wants to keep this up – especially in the SME space. We believe it will drive hard at the cloud market and take on Broadsoft offerings such as Gamma Horizon.

How Avaya has architected it’s compute is a great advantage to customers when compared to other shared or aggregated platforms. However, due to the increased compute requirements (and associated costs), it becomes some of an achilles heel in the SME space. However we believe that Avaya may just have cracked this and in doing so, is ready to take on Broadsoft.

Historically, the problem for Avaya here has been that the way it architected its compute system made cloud relatively costly for SMEs. We’re now hearing that Avaya is working on a more cost-effective solution that doesn’t compromise its dedicated cloud approach.

2. Offer its own cloud solutions

Not enough resellers have developed their own hosted cloud solution based on IP Office. How can Avaya change this? By building one itself. We know that Avaya intends to talk directly to many more of its mid-market customers this year. Our sense is that Avaya may go further and actually deliver products directly too.

3. Take contact centre to the whole company

This could be the year Avaya flips the contact centre on its head. There’ll be less talk about its established ACCS/AACE/IPOCC contact centre applications and more talk around Breeze which radically transforms the way companies interact with customers. 

4. Finally get there with video as a service

Video comms are exploding in every sphere. UC is no different. But let’s be honest, Scopia has struggled against other platforms especially when judged on user experience. Last year, we saw some movement here. Avaya released Equinox Meetings Online as a cloud-based video conferencing service. That gave SMEs an ‘in’ without having to invest in new infrastructure. This year, expect Avaya to accelerate this workstream.

5. Bring chatbots to mid-market and SME customers

Bots have been making their way into B2C comms for a few years now. This is inevitable given consumers’ preference for messaging as a medium for talking to enterprises. (20 billion texts and 60 billion social networking messages are sent every day).

Avaya needs to respond, and it has. It launched its Ava chat solution in 2016. Ava uses AI to respond to customers over social media, chat and messaging channels. That relieves pressure on agents. And when handing off to human operators, Ava transfers the full context of the chat, which further speeds up the process.

We expect Avaya to ramp up the tech this year. It will productise Ava to make it accessible to mid-market enterprises. That should give mid-market companies access to the kind of cost-efficient automation hitherto only within the grasp of enterprises.

6. Supercharge Zang and go after Twilio

It’s two years since Avaya formed its Zang spin off. Zang is, of course, a communications platform-as-a-service company. It lets developers embed call and text features inside their applications and software.

This is pretty cool stuff, which most people associate with Twilio. Why? Because Twilio is very good at PR and has been one of the few tech IPO success stories of recent years. But Zang has a feature set to match Twilio, and this year it looks set to make a much bigger impression.

At Engage, Avaya said it was rolling Zang into its newly formed cloud business unit (headed by former IBM guy Mercer Rowe). This could be the kick-start it needs.

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