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The WebRTC space has gone through many changes over the last few years. It transformed from a niche technical skill set to the technical platform that kept the remote world communicating during the early part of the pandemic and is now settling in as a critical part of the global hybrid workforce. An announcement today hinted at another era for video application development, an era of consolidation.
Almost buried within the announcement to employees of Twilio’s third round of layoffs this year was this:
“Lastly, we’ve decided to end-of-life (EOL) Twilio Programmable Video as a standalone product. Given it’s such a niche area and a relatively small part of our portfolio, we believe partnering with video industry leaders is the best way to ensure long-term product innovation for our customers. Removing Programmable Video from our portfolio will also allow Communications to more effectively focus on our pillar products – Messaging, Voice, and Email.
Those Twilions impacted by our Video EOL are aware of this decision, and we’ll continue working closely with them on transition plans.”
This is a sad announcement to see, but unfortunately it’s not entirely unexpected. As Alan Quayle noted on LinkedIn, Twilio has been under market pressure and activist investors for some time. CNBC reported the news by saying that “the cuts will strike deepest in Twilio’s Data and Applications unit, the same unit activist investors at Legion Partners and Anson Funds are pushing Twilio CEO Jeff Lawson to divest.”
The Data and Applications unit is where most of the 300 employee layoffs are occurring, according to the CNBC article. But later in his letter to employees (who are referred to as “Twilions” within Twilio), CEO Jeff Lawson also included the quote above about phasing out Twilio Programmable Video.
First, let me say this is sad news, especially for all the Twilio employees who were laid off today, as well as for all those Twilions who worked hard on Programmable Video for so many years.
A look back
When we launched the WebRTC.ventures brand in 2015, and became the world’s first services firm dedicated to live video application development, we started by doing work with Tokbox (now Vonage), which was at that time the primary CPaaS focused on video. Twilio was just down the street in San Francisco. They were buying billboards around the Bay Area, telling managers to “Ask your developer” if you don’t know what Twilio does. Twilio had brilliant developer-focused marketing for their messaging and SMS services, and some of the best developer relations experts and documentation that I’ve seen at any company.
In the WebRTC video space, many of us wondered when they would add video into their mix. In April 2017, version 1.0 of Twilio Programmable Video was released. We used it in multiple projects without complaint, and it was immediately a good option in the WebRTC CPaaS space. In May of that same year, I attended my first SIGNAL conference, the annual conference and launch party that Twilio put on where they announce their biggest product enhancements. I ended up attending a couple of the SIGNAL conferences and really enjoyed them. Once my colleague German and I even got to meet CEO Jeff Lawson and cross light sabers at the post-conference party (photo below).
The only conference parties I’ve been to that rival SIGNAL’s early parties are the AWS re:Invent conference parties. But I was always a bit disappointed at the SIGNAL conference announcements that there wasn’t more said about Programmable Video. It was always given the least air time compared to other announcements about messaging, SMS, IoT, and later on, data analytics.
Unfortunately, today’s announcement seems to confirm that Programmable Video was just too small a part of their portfolio to continue, especially while under the pressure of investors to tighten up operations and increase profits.
I should be clear that I do not own stock in Twilio and I have absolutely zero insider knowledge about this decision or the internal workings of the Twilio Programmable Video team. I have met many people in that group over the years and only have positive things to say about them as individuals, and so I’m sad to see that they have all left in one way or another. I am also not a Wall Street analyst of any kind, so I won’t pass my personal judgment on whether or not the activist investors are pushing good or bad changes on Twilio and their executive management.
There are a lot of unknowns right now, leaving a few key questions that I’ll speculate on below based on my current understanding of the situation and my more general market impressions given our company’s role as a systems integrator for many products in the WebRTC space.
What does this mean for WebRTC video and CPaaS?
The first question is, what does this mean for WebRTC video? WebRTC is most definitely alive and kicking. The hype of the pandemic has passed, and in some industries, the hype of remote work has passed. However, we are all still using WebRTC-based applications more than we ever did prior to 2020, and so the overall need and use cases for WebRTC is still much higher than it was in 2019.
There is less talk of telehealth now because healthcare is thankfully no longer facing an existential crisis. Doctors see most patients in person again. But telehealth is still much more widely accepted than it was prior to the pandemic. It’s much more acceptable now to have mental health visits remotely, as one example. Also, I continue to speak to my doctor online more than I do in person. Why go into their office if I just have a few questions and don’t need my vitals taken?
So, WebRTC and video over the internet is not going anywhere. But it has matured and the peak interest of 2021 has gone down. WebRTC development today is more about building scalable applications to target known customer markets than to charter new ground. Video in healthcare, education, finance, broadcasting and more are all alive and well. Whenever a market matures however, it’s natural to see some consolidation of market players. I expected to see some CPaaS consolidation but they certainly won’t go away.
To be clear, Twilio as a company is not going away either! This appears only an effort to focus the company on their core functionalities like Messaging and Voice, which is always what they’ve always been most well known for anyway.
What does this mean for users of Twilio Programmable Video?
Since I’m not a Twilio employee and I have no insider knowledge, I don’t know exactly what comes next for Twilio Programmable Video, or on what timeline. The message from Jeff only said that they have “decided to end-of-life (EOL) Twilio Programmable Video as a standalone product.” That could mean they will still support some form of video in their contact center solutions, sort of like how Amazon Connect is now more tightly integrated with the Amazon Chime SDK.
The next parts of Jeff’s message talks about “partnering with video industry leaders” and “removing Programmable Video from our portfolio” to focus on their core products of “Messaging, Voice and Email.”
This makes it clear that at some point they will stop supporting Video themselves. I’m less clear on what “partnering with video industry leaders” means. Will there be an announcement next that they will still use Video in some ways, but it will be powered by another provider like Vonage or Amazon? Or, will they simply recommend that existing customers look into converting to a specific provider?
How can you migrate to other solutions?
Although I haven’t seen what the End-of-Life timeline will be for Twilio Programmable Video, it seems clear that customers of Twilio Programmable Video need to consider alternative implementations.
This is where, in full disclosure, I do have an interest at play. Our team at WebRTC.ventures are leading experts in designing, building, testing, deploying and managing live video applications based on the WebRTC standard. We have built applications in a wide range of industry verticals, and using all of the major open source media servers and CPaaS’s, including Twilio.
Over the years, we’ve helped many customers move from one vendor to another, as well as between commercial APIs and open source media servers (in both directions). We don’t consider these changes as necessarily a bad thing or as a bad reflection on whichever company is being left behind by that customer. There are a lot of WebRTC use cases and implementations, and sometimes, a particular CPaaS just works better or has better pricing for a specific customer’s use case and implementation.
We’ve also seen customers ask us to build a wrapper around the CPaaS implementation, so that they could easily switch between two different providers, in case one provider was facing a temporary outage. They were also concerned about scenarios like this, where a vendor might shut down particular APIs they rely on. While most clients don’t have the budget or foresight to plan for multiple CPaaS implementations, it’s not a bad idea.
Twilio is a big company. I’m sure a reasonable timeframe will be provided for current customers of Twilio Programmable Video. And I’m sure that Twilio will remain an important provider in their core spaces of messaging, voice, and email. But now’s the time to start planning for a switch to another CPaaS, considering the pros and cons of moving to an open source implementation, or abstracting out your media server implementation to support a switchover from one provider to another. Let us know if we can help in any way.
On behalf of my team at WebRTC.ventures, I’d like to thank all of those who have worked hard on Twilio Programmable Video over the years. I truly wish you all the best in your next endeavors. Please stay in touch.