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The recently announced Twilio enterprise plan offers security and administration features for large businesses building cloud-based communications. As perhaps the most noted communication API platform, Twilio and its enterprise plan deserve a closer look.
Founded in 2008, Twilio offers cloud communication APIs for developers and businesses to embed messaging, voice and video capabilities into software applications. Twilio has grown in several dimensions over the years, and it just went public this summer.
The company has added customers and developers who have increased the traffic flowing through the Twilio infrastructure. Twilio offers many distinct services, veering toward WebRTC, video, task routing, IP messaging and internet of things. The company has also deepened its existing services, such as supporting larger voice conferences.
Twilio is not alone in the software-as-a-service (SaaS) space. Cisco acquired API provider Tropo last year. Vonage acquired communications platform-as-a-service provider Nexmo this year. And several startups are crowding the market. But Twilio is perhaps the largest, serving big and small customers -- from the hobbyist developer to a team of enterprise developers.
In many ways, Twilio is paving the path and defining how communication APIs should be created and delivered to developers.
Dissecting SaaS pricing models
Up until recently, Twilio had a pretty simple pricing model: You pay for what you use based on the number of messages, calls and events. This model is an easy sell to smaller companies. The idea is your spending with Twilio grows as you grow.
The normal way to purchase SaaS these days seems to be tiered in four plans, according to vendors' websites:
- Free. An unpaid tier that lets users sample the service.
- Subscription. You pay for a given set of features on a monthly or yearly basis.
- Pay per use. You pay for what you use to a given granularity.
- Enterprise plan. Potential customers are urged to call the vendor for pricing information. This "call us" plan targets large customers that could spend a lot of money on the service.
Twilio's enterprise pricing was a "call us" plan. If you are large enough, you have leverage, which means more attention from your SaaS provider and the ability to get price discounts in bulk.
For Twilio, that model worked nicely, but it had two challenges. First, large enterprises prefer to deal with large vendors and use the same terminology. Even if the offering of a Twilio competitor isn't as technically rich or easy to use, it often made more sense for a large enterprise.
Second, the "call us" option doesn't scale. How many enterprise plans can a vendor handle? For a vendor like Twilio, that pricing model is a hassle, since Twilio is built as a self-service company, as opposed to sales staffs hunting huge clients.
The new Twilio enterprise plan is targeting these two concerns by adding capabilities in these key areas:
- IT and operations. Better support for roles and authorization by introducing customizable role-based access control and single sign-on;
- Finance and accounting. Custom invoicing and segmented billing;
- Security and auditing. Audit events log and public key client validation; and
- Product development. Support for briefings and internal groups within an enterprise.
Some of these features are already available on the platform, while others are still under development and will be rolled out later. To some extent, the Twilio enterprise plan is a forward-looking release, probably announced because of the recent activity in the API space. Also, the Twilio enterprise plan announcement, made on Sept. 8, was just a couple weeks before Twilio's developer conference, which is a good place to get feedback on such announcements.
These additional capabilities are indeed more important to larger enterprises than smaller ones, but they come at a price. To be part of the enterprise plan, a company must pay at least $15,000 a month -- or $180,000 a year.
That kind of spending on communication APIs is considerable money in many large enterprises -- especially if the communication part is not a core business operation. What Twilio is saying is: If an enterprise needs this type of attention and wants to work in a way that fits internal policies around IT, security, legal and procurement, then Twilio is game.
The enterprise is a tough nut to crack for SaaS providers, and, in some ways, that's a shame. Enterprises have plenty to gain by adopting SaaS offerings -- whether it's for communications, analytics or any other area. While enterprises are starting to transform and lean toward cloud and SaaS offerings, SaaS vendors are also leaning toward enterprises.
APIs help enterprises integrate communications into workflows.
Enterprises need to develop a clear API management strategy.
Developers need to take advantage of API tools.