Today, voice over Internet Protocol (VoIP) systems account for a tiny percentage of new sales in the contact center industry, but because of increased flexibility, savings due to centralized management, and increasing functionality, more and more contact centers will be making the switch to VoIP, according to industry insiders.
Using an Internet Protocol private branch exchange (IPPBX) VoIP, systems translate voice calls coming from the public phone network into packets that can move across a company's data network. As the quality and reliability of the technology has improved, it has made inroads into the enterprise. Now those steps are being repeated with contact centers.
Katrina Howell, program manager of call center technology with San Antonio-based research firm Frost & Sullivan, found in a recent survey that fewer than 4% of the new contact center systems installed in North America are VoIP systems. While that is a small number, she expects it to jump to 35% by 2006.
"This is the future; this is going to happen," she said.
The large VoIP vendors like Cisco Systems Inc., Nortel Inc., Avaya Inc. and Alcatel SA all have their eye on the contact center. Cisco's IP Contact Center solution agent starts at $1,000 per agent, which includes inbound voice routing and computer telephony integration (CTI). Implementation costs, however, depend on characteristics of the existing systems, such as a company's network and its voice infrastructure.
Going with VoIP has proven cost effective for vCustomer Corp., a customer service outsourcing company. Though vCustomer is based in Seattle, its 1,800 contact center employees work at three sites in New Delhi, where labor costs are significantly cheaper.
All of the calls that vCustomer handles for its clients are routed into Seattle. They run through an IPPBX and automatic call distributor. The packets then travel across lease lines to New Delhi. In order to improve performance and system redundancy, the company has also installed automatic call distributors at each of the New Delhi sites as well. The calls are compressed in a four-to-one ratio to save on bandwidth.
Jeff Wasierski, vice president of technology for vCustomer, said the primary benefits of the VoIP system are centralized management and administration. The entire call system is monitored and maintained from Seattle with minimal staffing in New Delhi. New extensions can be added by simply plugging an IP phone into an Ethernet jack, he said.
That flexibility is very important in the contact center business, Wasierski explained. For example, during the holiday shopping season, when some of his customers have very high call volumes, Wasierski needs to add hundreds of temporary agents. With a VoIP system, adding rooms full of new phones is only a matter of running cable and plugging in units. The call distribution system can scale up dramaticontacty.
While a system like this could be set up and operated using traditional circuit-switched voice technology, vCustomer reaps some distinct advantages from VoIP. Compression is much simpler, since the PBX compresses the call when it comes in from the public line and the call is decompressed by the end device. With a traditional system, gateways need to be installed to compress and decompress calls, which can make transferring a decompressed call more complicated and expensive, Wasierski said. With VoIP, he said, he also gains higher levels of compression, so he uses his lease lines more efficiently.
In addition, Wasierski said, there are many more companies competing to sell bandwidth on overseas data links than companies doing the same for voice links, so he gets a better contract and pays less per data contact than he would per voice call.
Howell said that, as contact centers begin to merge their phone and data systems, linking calls with e-mail, instant messaging and databases, VoIP has a distinct advantage. The call is already just another application running over the data network. Companies will no longer have to invest in middleware to get their voice systems to communicate with data systems, she said.
Lori Bocklund, vice president of Morris Plains, N.J.-based consultancy Vanguard Communications Corp., adds that, since the September 11 terrorist attacks, many companies have been considering VoIP because IP networks are more resilient than data networks and are more likely to remain up in the event of a disaster.
Despite these advantages, VoIP is not a mature, established technology. It is still emerging and suffers from some of the hurdles that any technology in this stage faces. Wasierski said that one of the problems he faces is the relatively small pool of third-party vendors for services such as voice mail, interactive voice response and management tools. Less competition between vendors creates fewer options for customers.
Some VoIP functions, such as call monitoring, are not as technologically sophisticated or simple to use as with traditional systems, he said.
And this is an industry that has thrived on traditional, tested technology that works well today. "People are comfortable with their current systems, and they know that customer care has to be bulletproof," Howell said. So there is little incentive to change.
Nonetheless, interest in VoIP is growing. When Wasierski was shopping for systems, he approached the major vendors to talk about their traditional contact center technology. He said that none of them even wanted to show him their traditional systems. Everyone, he said, is putting all of their energy into VoIP.