The quality management and liability recording market is projected to exceed expectations, thanks in large part to the space's competitive landscape and product innovation.
Posted Dec 7, 2006
The quality management/liability recording space tallied $967.6 million in the first-half of 2006 alone, realizing an impressive year-over-year revenue uptake of 85.5 percent from first-half 2005's revenue of $519 million, according to DMG Consulting's "2006 Quality Management/Liability Recording Mid-Year Market Share Report." The market's total 2006 takings is also projected to surpass the consultancy's growth expectations and close out the year with more than $1.122 billion in revenue. Unveiled today, the document provides analysis along with revenue and market share figures for QM/recording players across segments such as QM/recording and contact center revenue with and without workforce management (WFM). The report, which also supplies a breakdown of TDM versus IP recording revenue, presents application revenue for contact centers apps such as performance management, speech analytics, surveying, coaching, e-learning, and WFM.
A portion of the growth in the QM/recording market is a result of the competitive landscape, according to Donna Fluss, principal of DMG Consulting and author of the report; the space, in recent months, has seen a significant share of M&A activity and the entry of new vendors with emphasis on the midmarket. But part of the market's expansion comes thanks also to product innovation, according to Fluss. "The vendors are continuing to introduce innovation into the marketplace and enhance existing applications," she says.
Drilling further into the QM/recording space, some of the trends the report notes are that adoption rates for IP-based recording, performance management, and speech analytics will continue to be very strong through 2006 into 2007.
As for the report's examination of the top vendors within the QM/recording space, NICE Systems again outpaced all vendors when evaluated based on contact center revenue market share excluding WFM. The company, which acquired WFM specialist IEX and performance management player Performix this year, pulled in $101 million in revenue and 32.9 percent market share for the first half of 2006, up from $85.3 million in revenue and 32.7 percent market in the first half of 2005. Witness Systems (first-half 2006: $86.3 million, 28.1 percent; first-half 2005: $74 million, 28.4 percent), secured the second space.
NICE and Witness were followed by Verint Systems, which announced its acquisition of Mercom, a provider of interaction recording and performance evaluation tools, in July (first-half 2006: $54 million, 17.6 percent; first-half 2005: $48.4 million, 18.6 percent). It's important to note, however, that Verint's revenue is based on public information and company guidance, and since the Mercom acquisition occurred during the year's second half, Mercom is evaluated separately. Autonomy/etalk (first-half 2006: $24.2 million, 7.9 percent; first-half 2005: $23 million, 8.8 percent) captured the fourth slot. Autonomy/etalk's revenue excludes product lines not related to QM/recording.
Rounding out the top 10 are:
Mercom (first-half 2006: $7.8 million, 2.6 percent; first-half 2005: $7.8 million, 3 percent)
Envision Telephony (first-half 2006: $6.8 million, 2.2 percent; first-half 2005: $7.2 percent, 2.8 percent)
VPI, formerly Voice Print International (first-half 2006: $4.1 million, 1.3 percent; first-half 2005: 2.5 million, 1 percent)
Magnetic North (first-half 2006: $3.8 million, 1.2 percent; first-half 2005: $3.9 million, 1.5 percent)
Aspect Software, which acquired QM vendor SophistiCom Technologies this year (first-half 2006: $3.5 million, 1.1 percent; first-half 2005: n/a)
TantaComm Systems (first-half 2006: $2.9 million, 0.9 percent; first-half 2005: n/a)
HigherGround, Telerex, Interactive Intelligence, Wygant, ASC, OnviSource, Spanlink Communications, VirtualLogger, and CallCopy complete the top 19, in order of revenue and market share. ASC's, Envision's, HigherGround's, and Magnetic North's revenues are based on company guidance and DMG estimates; Aspect's and Interactive Intelligence's revenues exclude product lines not related to QM/recording; and TantaComm's, Telerex's, OnviSource's, and Spanlink's revenues are based on DMG estimates, according to the report.
It should also be noted, though, that when assessed based on contact center revenue and market share including WFM for the first half of 2006, the top five vendors are Witness, NICE, Verint, Aspect, and Autonomy/etalk.
Overall, the QM/recording sector "continues to be a very dynamic marketplace," Fluss says. "The vendors continue to deliver high-value applications and functionality to end users. As long as there is quantifiable benefit from applications, they sell, and these applications absolutely have quantifiable benefits."
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