IP Technology: The likely future of contact centre markets

Certain locations in Central and Eastern Europe as well as the Middle East and Africa are emerging as strong markets because of the distinct advantages they offer in terms of cheap manpower, inexpensive real estate, and sound infrastructure.

Global growth consulting company Frost & Sullivan estimates that the total market size of contact centres in the EMEA region was 34,674 in 2004. The market is likely to grow at a compound annual growth rate (CAGR) of five percent to 44,574 by 2009.

While Western Europe is approaching saturation in terms of agent positions, Eastern Europe holds great potential to attract new business especially as the trend of outsourcing gains momentum. In fact, the contact centre market will see maximum growth in Eastern Europe, followed by parts of Middle East, Africa and Southern Europe.

"Although the new system shipment market is likely to shift towards Eastern Europe, Western Europe will see increasing demand for multi-channel applications and IP capabilities," remarks Frost & Sullivan Research Analyst Shomik Banerjee. "The release of capital expenditure for purchase of advanced technologies is the key to higher growth in the contact centre market."

Emerging IP technology and multi-channel communication are, in fact, likely to drive continued and strong demand for contact centre infrastructure. Multi-channel applications will benefit from the constant demand for new modes of communication that leverage the convergence of media. Adoption of these applications is likely to be particularly high in traditional contact centres.

With e-mail and Web chat applications fast gaining popularity, Frost & Sullivan expects multi-channel contact centre applications to account for 20 percent of the total shipments by 2009. The growth of these and other advanced applications is expected to drive adoption of IP contact centre solutions, which Frost & Sullivan estimates will grow to 17 percent of the total market shipments by 2009.

While IP solutions are widely believed to be the next big thing in the market and could offer significant cost savings, contact centres are still wary about migrating to IP technology due to the complexity of the environment and the strategic nature of customer communications.

"Since contact centres are typically risk-averse businesses, vendors will need to promote migration to IP as a way of capitalising on financial and business opportunities," notes Mr. Banerjee. "In addition, simple and cost-effective enablement of virtual and distributed architectures, a growing mobile workforce and the need for a flatter architecture for easier maintenance are likely to increase IP adoption over the forecast period."

With increasing adoption of IP, the contact centre market is likely to see greater virtualisation and consolidation in an effort to reduce operating expenditure (OPEX).

Among other important trends, the market is gradually shifting focus from efficiency to efficacy. As this happens, contact centres are likely to consider adopting IP technology to achieve the new targets of productivity enhancement and effectiveness in business processes.

Again, the imminent replacement of automatic call distributor (ACD) systems is also likely to trigger off the adoption of IP. Many of these systems were either installed or upgraded during Y2K and may need to be replaced now. This replacement cycle will contribute to a surge in system shipments till 2008.

Informal contact centres are also emerging as a strong market. Although this segment traditionally uses private branch exchange (PBX) hunt groups, the emergence of multimedia and IP is likely to create demand within it for high-end applications.

If you are interested in a research overview, which provides manufacturers, end-users and other industry participants with a synopsis of the latest analysis of the EMEA Contact Centre Markets, please send an e-mail to Janina Hillgrub, Corporate Communications, at Janina.Hillgrub@frost.com with the following information: your full name, company name, title, telephone number, e-mail address, city, state and country. We will send you the information via e-mail upon receipt of the above information.