Navigating the Cloud-Based Contact Center Infrastructure Market
users are turning to the cloud because they are weary of being told by their internal IT group that what they want to do is too difficult or time-consuming. Cloud-based contact center infrastructure vendors need to keep the "ease of use" operating imperative in mind as they build out and enhance their solutions.
Hybrid Is the Answer
Top cloud-based contact center infrastructure solutions support integration to on-premises and cloud-based third-party applications. The more common ones are integrations between cloud-based ACDs or dialers and an on-premises–based private business exchange or a cloud-based CRM application. Although the types of integrations vary widely, it's clear that end users in companies of all sizes expect their cloud-based contact center infrastructure solution to easily integrate with third-party applications, some of which may be homegrown. The availability of out-of-the-box integrations is a quick method of differentiating between offerings. The more mature solutions come with prebuilt integrations to more common third-party applications, and also offer published application programming interfaces to facilitate additional integrations.
Cloud-Based Activity Numbers Are Confusing
According to the market activity analysis, the number of cloud-based contact center infrastructure seats increased by only 12.8 percent during the past 12 months. This is substantially less than the 32.5 percent increase in 2012 and 80.2 percent rate in 2011. This year's increase also does not align with the activity DMG has seen in the market, but is, in fact, what the market activity section shows. DMG believes that this small increase is the result of the market providing cleaner and more transparent numbers than in prior years. For example, some vendors that included IVR-only activity in their agent seat counts in prior years are now able to separate live agent support from the automated activity.
As significant as the apparent slowdown in the sector is the relatively small number of new cloud-based contact center infrastructure seats that DMG is projecting for the next few years. Keeping in mind that DMG errs on the conservative side and that we modify our forecasts annually to take into account current market conditions, our projections currently show the addition of 261,000 new cloud-based contact center infrastructure seats in 2014, and 313,000 in 2015. This is not a lot of activity. There are many factors that could greatly alter these estimates, including the size of the overall contact center market and the ability of the cloud-based contact center infrastructure solutions to seamlessly integrate and interoperate with existing on-premises–based contact center solutions. If the total available contact center market is substantially greater than currently believed, many of the new seats will go to the cloud. However, organizations interested in these projections should keep in mind that contact centers are slow-moving organizations with an average eight-year replacement cycle. (There is no doubt that moving from one cloud solution to another may happen more quickly, particularly if a company is not satisfied with its solution provider.)
Final Thoughts
The cloud-based contact center infrastructure market is exciting and gives end users many choices and price points. But this market is confusing, and buyers need to be very careful. With more than 150 competitors and no clear leader, the market is filled with many types of offerings, and is ripe for consolidation. While it' true that companies can move from one provider to another without major penalties, it still requires substantial time and effort and typically involves building new integrations. Prospects need to carefully assess and compare offerings, as there are significant technical, functional, and operational differences among them. It's important to find a vendor who will be a good partner in the short and long term, which means finding one that is committed to your success and doing what it takes to help you achieve it.
For a detailed review of the cloud-based contact center infrastructure market, see DMG’s "2014–2015 Cloud-Based Contact Center Infrastructure Market Report."
Donna Fluss (donnafluss@dmgconsult.com) is founder and principal of DMG Consulting, a provider of contact center and analytics research, marketing analysis, and consulting.
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