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New IDC Study Predicts Strong Continued Growth for Cloud Contact Center Solutions

February 24, 2014

As enterprises begin to replace and add new solutions to their portfolios, many of them are finding that cloud-based solutions make the most sense for them. While economists have been cautiously stating that the U.S. economy is slowly recovering from the recession that began in 2008, it hasn’t necessarily translated to larger IT budgets for most companies. This has made more cost-effective cloud-based solutions even more attractive than they normally would have been.

Most organizations adopting cloud-based solutions are citing costs as their primary reason for doing so – cloud solutions require little upfront capital and allow companies to use only what they need – more organizations are finding the flexibility of cloud-solutions and the fact that they can be used across geographic sites and mobile devices particularly compelling. One place where cloud solutions make the most sense in terms of both cost and a virtual office perspective is the contact center.

Cloud-based contact center solutions are in a boom and have been for several years now. While the precise numbers vary from analyst group to analyst group, a recent study by International Data Corporation (IDC (News - Alert)) entitled “Hosted and On-Demand Contact Center Services 2012-2018 Forecast: Customer Experience Driving Contact Center Interactions to the Cloud” projected that U.S. spending for cloud contact center solutions and services will grow at a compound annual growth rate (CAGR) of 17.5 percent to $1.6 billion in 2018. At this time, the study found, a majority of companies are using or evaluating a hosted or on-demand solution for their contact center.

As contact centers are expected to become more customer-friendly and “omnichannel” while the same time holding down costs, the move to the cloud simply makes sense.

"End consumer demands combined with a need for speed, flexibility, and cost reduction are all driving companies to evaluate hosted and on-demand solutions," said Melissa O'Brien, research analyst for IDC’s Worldwide Contact Center Services, in a statement.

IDC survey data shows that 39 percent of respondents were using a hosted or on-demand service, 38 percent were evaluating a hosted or on-demand service, and only 23 percent were using a premises-based system and not evaluating the hosted or on-demand model. While smaller contact centers have found value in the cloud model for years – it provides them with advanced features and flexibility at an affordable cost – larger enterprises have been laggards with the cloud model, often citing security concerns. As the costs become more compelling, even larger enterprises are beginning to seek the efficiencies they can gain from the cloud, which will continue to propel the adoption of these solutions.

And while the penetration of cloud-based contact center solutions is highest in North America and Europe, other regions, such as Asia and South America, are beginning to turn their attention to cloud-based solutions, which is likely to propel the market even further. 




Edited by Alisen Downey

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