Hosted Contact Centers Save 40 Percent Over 5 Years Versus Premises-Based Offerings

Contact centers can lower the cost of their contact handling and workforce optimization infrastructure by up to 43 percent 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.

The Frost & Sullivan  study was sponsored by inContact , a provider of on-demand contact center software and contact center agent optimization tools.

Study authors analyzed 12 contact center configurations ranging in size from 50 to 500 seats, and in functionality from ACD-only to a full-function ACD, IVR, chat, outbound dialer, quality monitoring, workforce management, customer feedback, agent hiring and eLearning system.

Hosted contact center  services significantly reduce TCO over premise-based systems in both three- and five-year scenarios for all 12 of the configurations analyzed.

Over five years 100-seat centers averaged 23 percent savings, 250-seat centers averaged 34 percent savings and 500-seat centers averaged 43 percent savings.

In a 100-seat contact center, for example, the five-year savings jumps from 9 percent for a hosted ACD to 23 percent for a full-function, nine-application hosted system.

All of the study’s TCO calculations take into account the costs of systems and applications, implementation, maintenance and upgrades, and hosted per-agent, per-month fees.

The savings are driven by a pay-as-you-go hosted pricing model that eliminates in-house hardware investment, as well as related IT infrastructure, maintenance and upgrade expenses.

Premise-based infrastructure requires an upfront capital investment that can easily exceed $1 million, maintenance contracts that are typically 15-25 percent of the purchase price, other ongoing expenses and equipment replacement every five to seven years.

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.

By Team

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