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Call centers save more with cloud-based technology – Frost & Sullivan

Hosted call centers save more than 40% over 5 years versus premise-based software

(Manila, Philippines) – Local call centers can now lower the cost of their contact handling and workforce optimization infrastructure by up to 43% over a five-year period by utilizing cloud-based offerings rather than installing equipment in their own facilities, according to a new Frost & Sullivan report titled Premise Vs. Hosted Contact Center: Total Cost of Ownership Analysis.

The study, sponsored by leading cloud solutions provider inContact, analyzed 12 call center designs ranging in size from 50 to 500 seats and in functionality from different telephony systems such as ACD, IVR, chat, outbound dialer, quality monitoring, workforce management, customer feedback, agent hiring and eLearning system.

The analysis of total cost of ownership (TCO) concluded that hosted call center services significantly reduce TCO over premise-based systems in both three- and five-year scenarios for all 12 designs analyzed.

“Overall, call centers could save on costs of systems and applications, implementation, maintenance and upgrades, and hosted per-agent, per-month fees. The pay-as-you-go hosted pricing model of this technology allows call centers to eliminate in-house hardware investment as well as related IT infrastructure, maintenance, and upgrade expenses that go with premise-based infrastructure,” inContact Country Manager Junie Pama said.

“Compared with cloud-based solutions, traditional premise-based infrastructure requires an upfront capital investment that can easily exceed $1 million, maintenance contracts that are typically 15%–25% of the purchase price, other ongoing expenses, and equipment replacement every five to seven years,” he added.

The study also found that the larger the call center is, the higher the savings are with the hosted model. Over five years, 100 seat centers averaged 23% savings, 250 seat centers averaged 34% savings, while 500 seat centers averaged 43% savings. In addition, more money is saved as more call center applications are hosted in the cloud. In a 100-seat contact center, for example, the five-year savings jumps from 9% for a hosted ACD to 23% for a full-function, nine-application hosted system.

“This study not only validates the financial benefits of a cloud-based contact center infrastructure, but also clearly demonstrates that the appeal of the hosted model is not limited only to small businesses without the resources to purchase and maintain on-premise equipment,” said Paul Jarman, CEO of inContact. “The fact that the TCO increases as the number of seats grows will be a strong driver in the enterprise market, where we are already seeing significant traction for our own cloud-based contact center offerings.”

“The Philippine call center industry is projected to bring as much as $7.38 billion revenue this year, with 15-20% increase from last year’s revenue of $6.15 billion, according to the Contact Center Association of the Philippines (CCAP). We hope it can grow further with the help of the cloud-based solutions that are now available in the country,” Pama said.

About inContact
inContact (NASDAQ: SAAS) helps call centers around the globe create profitable customer experiences through its powerful portfolio of cloud-based call center software solutions. The company’s services and solutions enable call centers to operate more efficiently, optimize the cost and quality of every customer interaction, create new pathways to profit and ensure ongoing customer-centric business improvement and growth. To learn more, visit