The Financial Times just broke the news a few hours ago that Alcatel-Lucent has agreed to sell Genesys — not all of the Enterprise division — to European private equity firm Permira. The final price? $1.5 billion.

No updates on ALU, Genesys, or Permira’s websites.

The saga finally ends (follow the drama here, here, and here)?

(h/t @DanMorehead, @McGeeSmith)

The Alcatel-Lucent Enterprise bidding saga continues…

The latest report from Bloomberg puts a damper on the whole deal:

Permira, which had been in exclusive talks to buy the enterprise unit, is now in non-exclusive talks for Genesys, the part of the unit that makes software for managing customer call centers, a person with direct knowledge of the talks said on Sept. 2. Permira is a London-based buyout fund. Alcatel-Lucent fell as much as 7.7 percent, after dropping 4.1 percent Sept. 2.

Talk about prolonging the agony.

Alcatel-Lucent wants money for selling its Enterprise business — in the neighborhood of $1 billion.

Nobody’s interested now except Permira but just the Genesys piece, which is unlikely to fetch that dollar amount for ALU.

At this point it’s all a mess. ALU isn’t getting what it hoped for and perhaps neither will Permira. Nobody is happy and everyone’s a loser… ALU shareholders are watching their equity vaporize before their eyes, ALU Enterprise folks are feeling abandoned, Genesys employees (and customers) face an uncertain future, and Permira may never prospect for a telecom deal again.

Oh, did anyone notice the rumors of Europocalypse growing louder and more depressing economic data coming from the U.S?

I do like how Genesys has evolved its narrative over the years. In the beginning it was all about voice calls. Then it became interactions. Now Genesys labels them conversations.

Conversations are two-way, engaging, and personal — exactly the expectation of customers in today’s multichannel and mobile world when dealing with an organization.

It’s no surprise that Genesys continues to focus on mobile and multichannel conversations. I also think that the Groupama iPhone app opened the eyes of many in the industry to finally get a glimpse of how today’s technologies can shape customer service experiences of tomorrow.

The company is taking advantage of the interest in mobile applications to unveil its Mobile Customer Engagement strategy during G-Force Melbourne (Australia’s second most populous city, not the sunny town in Florida). Its latest G8 Suite offers solutions to help companies make this mobile leap as seamless and as painless as possible.

However, I think the bigger news came from ZDNet Australia:

Contact centre software licensing will be a thing of the past, because contact centre services will move to the cloud within five years, according to Alcatel-Lucent Enterprise’s Asia Pacific senior vice president Michael McBrien

The company, which offers its Genesys call centre services both in the cloud and as an on-premise software-based service, has around 1000 customers in the cloud already, McBrien told journalists at the G-Force 2011 conference in Melbourne today. He said that it would encompass Alcatel-Lucent Enterprises’ entire customer base by 2016.

Having 1,000 cloudy customers is quite impressive, especially in the contact center space. Genesys, of course, does not offer the infrastructure for cloud-based solutions and have no interest in becoming a massive cloud company, but I have to think that its cloud partners are grinning ear to ear with 1,000 customers. I also wonder how the Genesys licensing scheme will evolve with the cloud paradigm shift and how that impacts the company financially since software licenses are very much its bread and butter. McBrien told ZDNet that the company should “go to a different market, a mid market.” Reminds me of the Genesys Express days — didn’t work out too well though. Maybe we’ll see it resurrected in the near future?

In the meantime, there’s still a license.dat file lurking somewhere between the premise and cloud, and the sacred port of 7260 listens intently amidst the hum of a data center, each ping echoes through the vast networks like a drop of gold coins.

Read the official Mobile Customer Engagement strategy press release:

Melbourne, Australia, August 24, 2011 — Alcatel-Lucent (Euronext Paris and NYSE: ALU) is calling upon companies to take advantage of today’s powerful, multi-channel smart phones by creating a new model for mobile customer engagement. With today’s mobile approach mostly limited to self-service and limited transactions, Alcatel-Lucent is prescribing a strategy that brings conversations to mobile customer service applications by intelligently linking contact center agents and customer care resources from across the enterprise, including those in the back office and branch locations. While many companies already offer their customers mobile service apps — consider the thousands available for banking, retail and travel — these are often poorly integrated within a company’s existing customer service strategy and contact center technology platform. As a result, today’s mobile customers suffer from a disconnected experience that often delivers frustrating hold times or no way to contact an agent or resource for additional support. This disconnected approach also fails to unleash the power of today’s smart phones in transforming customer engagement with proactive contact, personalized applications and location-based services. During the G-Force Melbourne 2011 customer event, Alcatel-Lucent outlined its Genesys Mobile Customer Engagement strategy, which focuses on helping companies move from transactional applications to mobile conversations and recommends the following best practices: Contact Me – provide seamless and secure ‘click-to-call’ capabilities with context from smart phone applications with immediate agent support or scheduled call backs. Connect Me – deliver mobile customers to best resource from contact center to back office departments and branch locations, across any channel – voice, SMS, chat. Know Me – provide personalized mobile experience based current service tasks and proactive contact with targeted offers and location-based services. “Today’s consumers rely on their smart phones and tablets to be their ‘windows to the world.’ Businesses need to be creative in offering apps that integrate into all areas of the enterprise, from sales and marketing to customer care,” said Tom Burns, President, Alcatel-Lucent Enterprise. “Our mobile solutions featured in the G8 suite are bringing our core cross-channel routing and application openness together with the power of our Genesys Conversation Manager to provide the context and presence information needed to deliver the next generation mobile experience.” At G-Force Melbourne, Genesys is bringing together the solutions companies need to deliver the next generation mobile customer experience. The Genesys G8 suite will be on display, including: Conversation Manager – bring agent conversation to an iPhone Integrated Mobile Customer Care Apps – mobile customer service applications UC Connect – linking mobile customers to back office and mobile experts

About Alcatel-Lucent (Euronext Paris and NYSE: ALU) The long-trusted partner of service providers, enterprises, strategic industries and governments around the world, Alcatel-Lucent is a leader in mobile, fixed, IP and Optics technologies, and a pioneer in applications and services. Alcatel-Lucent includes Bell Labs, one of the world’s foremost centres of research and innovation in communications technology. With operations in more than 130 countries and one of the most experienced global services organizations in the industry, Alcatel-Lucent is a local partner with global reach. The Company achieved revenues of Euro 16 billion in 2010 and is incorporated in France and headquartered in Paris. For more information, visit Alcatel-Lucent on: http://www.alcatel-lucent.com, read the latest posts on the Alcatel-Lucent blog http://www.alcatel-lucent.com/blog and follow the Company on Twitter: http://twitter.com/Alcatel_Lucent.   Contact the Alcatel-Lucent Press Office:    press@alcatel-lucent.com

Exodus Software has some interesting product ideas brewing across the pond (HERA, for example), and today it’s debuted a License Audit Service (LAS) for the Genesys CTI platform.

Licensing typically takes up a big chunk of the overall expenditures in a CTI deployment, and as with most any other software licensing procurement, the recommendation is to “buy into the future” to accommodate for growth. However, this being the real world, there are times when the growth projection is off, or the economic climate requires re-evaluating license costs, or frankly you just want to know for sure how the licenses are being consumed.

Exodus claims that LAS can help “reduce (annual) license support costs by as much as 30%”… That’s quite a staggering number, especially when some big contact centers house thousands of agents.

Details (e.g. demo, pricing, etc.) are available from the brochure (PDF).

The latest update on the sale of ALU Enterprise? Now there are reports that the sale may be finalized by the end of this week:

Alcatel-Lucent could finalise the sale of its enterprise business by the end of the week.

After months of closed-door negotiations with varied suitors including HP and Siemens Enterprise Communications, the company confirmed interest overnight in “exploring strategic options” for its non-telco business.

The business provided unified communications, workflow management and call centre software to large businesses internationally.

The big challenge is in negotiations with the French workers unions.

Stay tuned…

Back in April news broke that Alcatel-Lucent was hanging a FOR SALE sign on its Enterprise business which includes Genesys, the top contact center software vendor. A few weeks later it’s reported that potential buyers were in San Francisco to discuss a deal worth around $1 billion, and that Siemens Enterprise Communications (SEN) was the front runner.

Now more than two months later Reuters reports of a new “lead horse” to buy ALU Enterprise: Permira:

Private equity firm Permira has emerged as the frontrunner to buy a collection of businesses put up for sale by telecom gear maker Alcatel-Lucent (ALUA.PA), sources familiar with the situation told Reuters.

The crown jewel of the sale is Genesys, which sells software for the operation of call centres and video conferencing and is attractive for its high margins.

“Permira is the lead horse,” one source said. It is offering $1.3 billion and the process is expected to last another month.

Permira and Alcatel-Lucent declined to comment.

Permira is a private equity firm founded in Europe with approximately €20 billion. It has a very diverse portfolio, owning companies worldwide in the life sciences, entertainment, fashion, technology, financial, and media sectors. This is a firm that invests in Silicon Hills’ (aka Austin, TX) Freescale Semiconductor as well as iconic fashion group Hugo Boss and Valentino.

So naturally, it wants to get into the networking and telecom business as well…

This latest Reuters report also sheds some light about this sale which leads me to believe SEN is no longer a serious contender to acquire ALU Enterprise.

First, sources told Reuters that an SEN offer had been rejected because of its “complicated structure.” Plus, SEN’s 51 percent owner the Gores Group “tried unsuccessfully to bring more partners into the bid, including KKR” (another global PE firm). The logical reason for SEN’s approach would be either it didn’t have the $1 billion or it didn’t want to risk that much on its own. Even though Alec Gores doesn’t shy away from high stakes gambling, Gores Group-backed SEN appears to be quite conservative in terms of investing in its future.

Second, Alcatel-Lucent unionized workers in France are jittery about a deal and have already staged a strike. French labor laws are a valid concern here. Just this will discourage bidders that aren’t experienced in dealing with European labor and unions.

Third, sources said Alcatel-Lucent has hired high-profile Qatalyst Partners as advisers on the sale. Qatalyst is known for negotiating great deals for its clients that are mostly in the tech sector, some notable transactions: National Semiconductor (acquired by Texas Instruments for $6.5 billion), Atheros (Qualcomm, $3.6B), Kosmix (Walmart, undisclosed), Netezza (IBM, $1.9B), 3PAR (HP, $2.4B), Palm (HP, $1.4B), and LifeSize (Logitech, $405 million). If the choice is between SEN and an established private equity firm like Permira, it’s unlikely that Qatalyst will advise picking SEN as the buyer.

So how close is Permira? Will the price go higher than $1.3B? Or could there even be an IPO in the U.S.?

Thanks to you, dear reader, insideCTI has reached another milestone: 100 Facebook fans! Honestly, I’m very grateful that this little site in the dark corner of the vast blogosphere has 100 FB fans interested in the niche content of contact center telecom.

To commemorate this milestone I will give out copies of The Handbook by Tony Tillyer to insideCTI readers. The Handbook is built upon Tillyer’s earlier work, “Genesys Rough Guides,” which served as the foremost unofficial introductory documents to the Genesys community.

If you want a free copy of The Handbook just get in touch with me or leave a comment below (make sure you enter a valid email/Twitter address so I can reach you). Supplies are limited so first come, first serve (much like an ACD queue).

As always, thank you for your continued support.

The newswires are reporting that Alcatel-Lucent is meeting potential buyers for its enterprise unit this week in San Francisco. News of the company’s intent to sell first surfaced nearly two weeks ago. Possible suitors include Avaya, Cisco, HP, and Siemens Enterprise Communications (SEN). It’s said that SEN is considered to be the front-runner in the deal.

Some industry analysts and bloggers are picking HP to win it and arguing that a buyout from SEN wouldn’t make much sense. But there are also detractors. Dave Michels from Pin Drop Soup postulates, rather succinctly:

If It is cash then Cisco wins (who wants their stock anyway), and if it is a stock deal SEN wins. If it is not cash or stock, it is an IPO.

To me spinning off the enterprise business (which includes Genesys) would make the most sense. There are definitely growth opportunities for this part of the business, especially with Genesys’ momentum in the industry. ALU can partly own and invest in the spinoff if it wishes to continue to enjoy the fruits of the enterprise division. But the spinoff process is sometimes messy and perhaps costly, and it appears that ALU is really eyeing for a cash transaction of at least $1 billion for this sale, instead of a stock transaction.

I don’t believe any publicly-traded company whose core competency isn’t in enterprise telecom would want to touch this deal, simply because Genesys is such a big part of the equation. Cisco, having recently trimmed its consumer business in order to appease shareholders, wouldn’t dare to spend a cool billion on ALU Enterprise. Cisco shareholders want to see more sales of big iron data routers and switches, and new products to fend off cheaper competing products.

A buyout from HP may seem like a match made in heaven, but I think HP has more to gain as a mistress than the bride in this situation. It already has a good partner relationship with ALU Enterprise. HP thrives on partnerships when it comes to augmenting and supplementing its enterprise portfolio, but it will make bold moves such as the Palm acquisition in acknowledgement of its tablet computing failure (the HP Slate) and corrected the course with the Palm buyout. A lot of what ALU Enterprise offers overlap with what HP can already do, except in the contact center and IP telephony areas. With 2Q2011 earnings release coming up in less than a month, I’m not so certain that HP would stir the pot and go for it.

That leaves private equity firms and/or other private investors. Both Avaya and SEN are backed up private equity money, and I wouldn’t be surprised if Silver Lake Partners or Gores Group decides to expand their portfolio with ALU Enterprise. These equity firms have a track record of understanding and not shying away from enterprise telecom companies. However, Avaya hasn’t completely mastered the aftermath from the Nortel Enterprise buyout yet. SEN, on the other hand, is desperate for some traction especially here in the U.S. It’s no wonder SEN is reportedly the front-runner in the deal.

However this deal goes down, my hope is that it isn’t rushed. There are plenty of potential buyers and options, including for ALU to do nothing.

It appears that Cisco isn’t the only one looking to go on a diet.

According to the Wall Street Journal MarketWatch:

Alcatel-Lucent (ALU6.01, -0.05, -0.83%) SA is exploring the sale of its business that sells phones and other telecommunications gear to corporations and which could be valued at $1.5 billion or more, according to people familiar with the matter.

The Franco-American company has hired advisers and during recent days began to examine options for the business, which has about $1.5 billion in annual sales. Besides a sale to a single buyer, other options include an initial public offering of stock. An Alcatel-Lucent spokesman declined to comment.

Genesys would be part of the enterprise business. Speculation on potential buyers include Microsoft, HP, Ericsson, and other private equity firms.

Previously there was also talk about ALU being sold to an undisclosed Chinese firm. So there’s definitely something going on within the company…

It’s not that its enterprise business isn’t making money, but it’s just too small in the overall picture. And like Cisco, ALU also has anxious shareholders to appease and thinks that return to its roots will help.

There’s a reason the word “app” became the American Dialect Society’s 2010 word of the year. Abbreviated from “application,” the terminology has entered the common vernacular thanks to the explosive growth of smartphone users. It sort of interesting to find myself saying the whole word “application” in the context of desktop and laptop programs, yet I use the short-form “app” when I talk about programs on my iPhone and iPad.

But we all love the apps on our mobile devices. From our fingertips we can instantly experience the joy of being entertained, to stay connected with friends and coworkers, and be productive with our work.

Companies have realized the power of apps to create another channel for customers to interact with. Users can buy products, share the experience, and easily lodge complaints — but still via emails or toll-free numbers. Others have gone farther to improve the interactive experience — Groupama’s app is a pioneering example.

Independent developers have realized the power of apps with novel ways to help consumers deal with companies. This is evident with apps such as Fonolo, LucyPhone, and FastCustomer. The value of these apps is they address the top complaint among users when dealing with companies: hold time.

Obviously, having an app wait for you is still far from ideal. Once connected to an agent, you’re still speaking with a representative who has no idea that you’re a loyal customer, a new customer, or what you want to discuss. In other words, the app can know a lot about you, but how come that information isn’t passed along?

The missing link is CTI, and Exodus Software’s HERA wants to bridge that gap, starting with support of Genesys, the leader in CTI.

I’d whetted your appetite about this recently. According to Wyn Owen, owner of Exodus Software and lead developer of HERA, the software opens enterprise-grade Genesys technologies to the smartphone app market. Data gathered by an app can be passed along securely with 128-bit encryption back and forth between the app and HERA server, which can reside as a cloud service (using Amazon’s highly reliable infrastructure) or as a premise-based solution. Other media types such as WAVs, JPEGs, and videos are also supported. These interactions originating from apps end up in the Genesys environment like any others, completely transparent to the end users.

For example, an airline can now build an app for its customers to buy tickets from an iPhone (Android or BlackBerry also supported) app by entering parameters such as destination, dates, and so forth. And if the customer has a question before purchasing, s/he can tap the “Contact Travel Agent” button and get connected to a representative who will already have the customer’s frequent flyer account, name, address, and other relevant information.

This would be an exceptional user experience originating from a smartphone. After all, we never like to be asked more than once about our account number, and shouldn’t have to suffer again just because we decide to use a smartphone app.