Frost & Sullivan Sees U.S. Market Poised for Hosted Contact Center Adoption

New analysis from Frost & Sullivan finds that the market for hosted contact center solutions earned revenues of $280.2 million in 2007 and is likely to reach $1.1 billion in 2014.

According to the report, inherent advantages, such as flexibility, low cost of entry, and scalability, drive the deployment of hosted contact center solutions across North America. Leasing contact center technology allows organizations to deflect the high upfront capital expenditure normally associated with premise deployments, something particularly attractive for midsize and small companies seeking access to the same advanced technology as large enterprises, but at an affordable price, it said in the report.

Frost & Sullivan believes that the market is witnessing a fundamental shift in the contact center agent population from a fixed brick and mortar environment to one that is becoming ‘virtualized,’ distributed geographically with much more flexibility to manage seasonal peaks and valleys," notes Frost & Sullivan Strategic Analyst, Michael DeSalles. "The hosted model supports this movement and offers cost savings that can be significant in a multi-site environment."

However, the hosted model is not without its share of challenges, which include the perceived lack of control over operations and the security of critical customer data. Clearly, older legacy deployments in premise-based technology present growth challenges for the hosted deployment model. "Many slow adopters are hesitant to hand over control of the technology to someone outside of the four walls of the contact center," explains DeSalles. "Hence, end-user education on the benefits of hosted contact center solutions, along with documented successful implementations, is essential to drive greater acceptance and uptake."

Hosted providers have wisely included tenant self-administration capabilities in newer releases of the technology along with process/methodologies with enhanced security options. These measures have played a critical role in overcoming reservations around security and ease-of-use after initial deployment.