LONDON -- The move by customer care and billing vendor Amdocs to acquire Nortel's customer relationship management...
By submitting your email address, you agree to receive emails regarding relevant topic offers from TechTarget and its partners. You can withdraw your consent at any time. Contact TechTarget at 275 Grove Street, Newton, MA.
subsidiary, Clarify, announced Tuesday, will leave rivals licking their lips.
Amdocs' sole focus on the telco sector means more CRM business for companies focusing on the enterprise market as a whole, such as Siebel, PeopleSoft and Oracle.
For $200m in cash -- a mere fraction of the $2.1 billion in stock Nortel agreed to pay for Clarify in October 1999 -- Amdocs gains a comprehensive suite of enterprise-wide CRM applications. Although the majority of this business -- 55% of revenues -- comes from enterprise customers, Amdocs is more interested in the 45% of the business coming from telcos, leaving enterprise customers up in the air with an ambivalent message.
Amdocs has said that it will continue to support Clarify products -- including contact center, sales force automation, customer support and marketing. But it won't continue marketing to this sector.
Furthermore, Amdocs' revenue projections for 2002 suggest that enterprise sales will become insignificant going forward. The company says it will see $100 million in revenues from its newly announced CRM acquisition after 10 months of combined operation, at the close of fiscal 2002 -- yet the Clarify operation has a $50 million per quarter run-rate right now.
At a time when the telco market is particularly suffering, Amdocs hopes Clarify's contact center suite will be the silver bullet to regenerate sales. Just like Siemens, which formerly owned a 20% stake in call center company Quintus as part of its wireless CRM strategy, Amdocs hopes the Clarify acquisition can provide the boost it needs in this space, supplying the back-end multichannel contact center with browser-based and SMS queries for trouble ticketing, for example.
As a company that focuses exclusively on the carrier market, Amdocs clearly wants to be a leader in wireless CRM despite current sentiment, which suggests it is still a nascent market in dire need of a host of improvements to mobile infrastructure and software before it can ever really fly.
That said, the acquired sales force, marketing and service modules will also prove attractive to Amdocs' 80 existing customers, since they have work flow, management and multichannel support not present in its customer service applications.
Of course, the obvious candidate to buy the business was SAP, which had a two-year-old reseller deal with Clarify for its contact center. That relationship collapsed in March after SAP signed a joint development pact with Alcatel subsidiary -- and Nortel competitor -- Genesys to develop a similar product. SAP and Clarify had been close -- the enterprise resource planning stalwart had done a great deal of the basic integration work to embed the Clarify software into my.sap.com. But when it released CRM 3, the choice was clearly between providing customers with an overhead in integrating a third-party product and supplying its own, albeit less mature, offering. SAP chose the latter route.
The deal also signifies a fairly dramatic about-face for Clarify's current parent, Nortel, which had harbored grand ambitions to leapfrog market leader Siebel in CRM when it bought the company. The collapse of Nortel's core networking business, however, forced Nortel to reconsider this objective.
MORE INFORMATION ON THIS TOPIC:SearchSAP Best searchSAP Web Links on customer relationship management software Best searchSAP Web Links on SAP's relationship with Clarify
the451 (www.the451.com) is an analyst firm that provides timely, detailed and independent analysis of news in technology, communications and media. To evaluate the service click here.
Dig Deeper on SAP CRM software