• February 17, 2004
  • By David Myron, Editorial Director, CRM and Speech Technology magazines and SmartCustomerService.com

Voice Self-Service Adopts ASP Model

Make way for hosted voice self-service offerings. A report released today by Yankee Group states that hosted voice self-service solutions are far more cost-effective at serving customers than is the use of live agents, and present an alternative to building an internal interactive voice response (IVR) system. The report, "Hosted Speech Applications are Poised for Growth, Increasing Competition and Volatility," focuses on qualitative trends in voice self-service. After calculating things like salary, benefits, training, equipment, and real estate expenses, the cost to have a live agent answering customer service calls can be about 50 cents per minute, depending on volume, according to Art Schoeller, Yankee Group CRM strategies senior analyst. By installing a voice self-service solution at the customer's site, Schoeller estimates it would drop to roughly 30 to 40 cents per minute. However, having that solution hosted by a third-party vendor could drop that outlay down to as little as 15 to 20 cents per minute. With a hosted voice self-service solution application, customer companies don't have to worry about hiring programmers to manage the continual tuning of the application. Plus, unlike an on-premise solution in which a fraction of the ports are running, companies only pay for the ports they use in a hosted model. "Hosting can align expenses with the benefits for a real-time return on investment," Schoeller says. After the dotcom boom then bust, largely driven by application service providers (ASPs), the term ASP took on the stigma of a four-letter word within corporate America. "Well, it's baa-ack
!" Schoeller says. He does not have any market size number on the hosted voice self-service market, but estimates it to be in the low-$100 million range. Unfortunately for speech technology, it matured at a time when budgets were still sliding as a result of the down economy. "Speech technology matured and got past the early-adopter phase right when all hell broke loose with our budgets. So mainstream customers were very risk-averse when speech took off," Schoeller says. He adds that although companies were also skeptical about the hosted model, it enables companies to make smaller investment in a promising technology, rather than investing a hefty sum to purchase and install the voice self-service solution on premise. Leading these initiatives, according to Schoeller, are traditional interactive voice response (IVR) companies like West and First Data, startups like beVocal and TellMe, as well as IVR platform providers, including Intervoice. Additionally Schoeller says AT&T and Qwest are offering hosted voice self-service as an extension of their 800 services.
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