QM: The Upswing Continues
The quality management/liability recording space reached the billion-dollar threshold in 2005, experiencing solid year-over-year growth of 10.3 percent to $1.025 billion, according to DMG Consulting's "2006-2007 Quality Management/Liability Recording Product and Market Report." The growth spurt is expected to continue: The market will realize 9.5 percent growth by year's end, bringing the overall market to $1.122 billion, and a 9 percent uptake in 2007, according to the report. The 400-page market share analysis of the QM/liability recording space, features more than 40 vendors and provides insight into products, pricing, and market share.
Donna Fluss, principal of DMG Consulting and author of the report, attributes much of the market's forecasted growth to innovation across a variety of modules like speech analytics, performance management, and classic QM, and products' ability to target specific problems plaguing contact centers. "They do a very good job of addressing specific issues and helping enterprises deliver on the classic goals of contact centers: Do more with less, improve the customer experience. Now, some components of these suites also contribute to increasing incremental revenue for enterprises," she says. There are also many best practices available in the marketplace, which helps bolster successful deployments.
The market will, however, grow at a slower rate, largely attributable to size of the market mature; the larger a market is, the harder it is to experience the same aggressive growth pattern.
The report also examines vendors across several segments including contact center revenue excluding workforce management. NICE Systems, which acquired the assets of Dictaphone's CRS division in May 2005, leads all vendors with $182.3 million in revenue and 34.1 percent market share in 2005, compared to $155.6 million and 34.1 percent in 2004. Witness Systems (2005: $152.3 million, 28.5 percent; 2004: $140.1 million, 30.7 percent) took the second slot, trailed by Verint Systems (2005: $102 million, 19.1 percent; 2004: $77.9 million, 17.1 percent). (When workforce management is factored in Witness holds the top position with $185.4 million and 32.6 percent market share, slightly edging past NICE ($182.3 million, 32 percent)).
Autonomy's etalk (2005: $42 million, 7.9 percent; 2004: $40 million, 8.8 percent), secured the fourth spot, while Mercom, (2005: $15.1 million, 2.8 percent; 2004 numbers n/a), acquired by Verint earlier this year, and Envision Telephony (2005: $13.8 million, 2.6 percent; 2004: 12.7 percent, 2.8 percent) followed. Magnetic North (2005: $7.3 million, 1.4 percent; 2004: $4.6 million, 1 percent), Voice Print International (2005: $5.6 million, 1 percent; 2004: $5.1 million, 1.1 percent), HigherGround (2005: $3.6 million, 0.7 percent; 2004: $2.1 million, 0.5 percent), and ASC (2005: $3 million, 0.6 percent; 2004: $8.3 million, 1.8 percent) round out the top 10.
Remaining vendors include:
OnviSource (2005: $3 million, 0.6 percent; 2004 numbers n/a)
Wygant (2005: $2.7 million, 0.5 percent; 2004: $3.3 million, 0.7 percent)
VoiceLog (2005: $1.2 million, 0.2 percent; 2004 numbers n/a)
SophistiCom Technologies, acquired by Aspect Software this year (2005: $1 million, 0.2 percent; 2004 numbers n/a)
Dictaphone (2005 revenue and market share n/a because of NICE's acquisition of its CRS division; 2004: $6.6 million, 1.4 percent)
ASC, etalk, and Magnetic North's revenues are based on company guidance and DMG Consulting estimates, and OnviSource and SophistiCom's revenues are based on DMG Consulting estimates, according to report. The report also notes that Voice Print in 2005 underwent a major restructuring, which improved profitability, but resulted in revenue decline.
Overall, though, "this is not a dull market," Fluss says. "These vendors understand that they are contributing to the success of enterprises and they are very serious about delivering innovation." She adds, though, that "it's a very large market and typically as markets mature they seriously consolidate." But while consolidation continues, newer vendors are entering the QM mix. Fluss contends that more than 90 percent of the vendors in this space are profitable, "so obviously the demand for these [solutions] is quite high. But in a typical market you're going to have your leaders buying each other and ultimately the overall market will shrink."
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