In the bigger scheme of things, service providers have an important role to play in the contact center space – perhaps more than you might think. On a basic level, they provide connectivity, but when looking at the growing trends towards hosting, the cloud and virtualization, there is another story to consider.

Telecom operators – particularly wireline incumbents – face declines to their legacy business, not only for services revenues, but for the customers themselves. With so many IP-based operators, businesses have many options, not just for cheaper services, but better services. Hosted contact centers can be one of these services, and with the right approach, this can help operators protect their customer base from these new entries as well as tap new sources of revenue.

To better understand the opportunity, consider the needs of businesses operating their own contact centers. While this may be the best route in terms of maintaining control, today’s realities pose unprecedented challenges. One core challenge is the complexity of pathways into the contact center. We’ve come a long way from the days of customers calling into a toll-free number on their touchtone phone and waiting in a queue for an unspecified period of time. With today’s technologies – and with that, heightened expectations – customers will no longer tolerate that type of experience.

Of course, this is a good thing, and to facilitate that, contact centers now support all the tools. Touchtone calling may still be popular, but it now shares the stage with PC-based calling on softphones, VoIP, IM, chat, email, mobile calling, and more recently, video. Not only does this translate into multi channel and multi modal communication, but contact centers must manage traffic coming in over three different types of networks – PSTN, IP and mobile. Premise-based contact centers generally have the means to do this, but as these modes proliferate and increasingly need to interwork, it stands to reason that service providers are in a better position to optimize all these call flows.

The same also holds true on the agent side of the equation. They too must manage calls across all these modes and networks, and to keep up with customers, need to become fluent using multiple modes at the same time. Add to that social media, and agents have a nearly-overwhelming toolbox to work with. To deliver consistent, quality experiences, contact centers need a seamless network environment so agents can simply do their jobs.

There is also an IT element that ties all these call flows together. To manage both inbound and outbound activity, horizontal applications must work seamlessly – call recording, ACD, IVR, CRM, reporting, etc. Businesses with deep resources and budgets can address this, but as customers become more demanding, and as the trend to using remote agents continues, my view is that IT will have a harder time defending this model – especially if contact center performance drops off.

Before moving on, let’s not forget everyone else – the businesses with limited or shrinking IT resources – which seems to be the norm these days. Clearly, they face even greater challenges running an internal contact center – if they even have one at all.

This brings us to the hosted model and an opportunity for service providers to address an important need for their business customers. It’s a given that the technology and IT issues are substantial, but let’s put that aside for a moment. All technology problems are solvable with the right approach and partners, but service providers must first be in the conversation and then get customers to see them as part of the solution.

Before getting them to consider a hosted contact center, businesses must first have a pain point, and in some cases, simply see the value of having a contact center in the first place. The latter group represents the Greenfield opportunity for customers, and the starting point is explaining how good contact center performance drives customer satisfaction, which in turn drives customer retention. It’s a powerful formula, and operators can leverage their trusted partner status to show them that hosted provides a manageable, affordable solution. Not only that, but a hosted contact center may not be such a leap from the current services being used, such as Unified Communications.

Coming back to customers with premise-based contact centers, the pain points will usually be cost, but other factors include easing IT’s burden, managing growth, improving operational reliability, or adding more sophisticated capabilities to improve performance – first call resolution, hold time, handle time, dropped calls, managing complex/multi channel calls, etc.

In all these cases, the hosted model provides distinct advantages. On the cost front, many businesses will welcome not only a drop in Capex/Opex, but also the assurance that comes with cost certainty from a fixed monthly cost. Service providers have the scale of operation to host a partitionable platform to support multiple tenants, providing a lower cost for each.

Another important selling point here is reliability. The hosted model provides business continuity and disaster recovery for this mission-critical function. All premise-based operations understand the issues around preserving things like routing, queuing and call status during service disruptions, especially with remote agents – even more so if offshore.

Service providers are generally not in the business of building contact center platforms, nor are they known for innovation and rapid development of new applications. However, there is a healthy ecosystem of partners to work with, not just vendors and software developers, but also with channel partners who add value in terms of provisioning, customization and integrating contact center elements with IT functions that drive business processes.

The key takeaway here is that hosted contact centers provide a dual benefit. Businesses benefit for all the reasons outlined herein, whether moving away from a premise-based setup or adding a contact center for the first time. Service providers also benefit by injecting new blood into their business and building stronger ties with their customers. Hosted really isn’t that big a stretch for the contact center, especially when considering how widely it’s used for other business functions.

As such, service providers should worry less about the technology around hosted. They should work from strength and leverage the existing relationship and show how their network and telecom expertise adds value to solve real problems for their customers. Conversely, all the technology in the world doesn’t help if the service provider cannot zone in on the pain point and get the customer to see them as a solution. If they’re already a trusted partner, this really shouldn’t be hard to do – but only if the partner ecosystem is in place. If you’re wondering what that ecosystem looks like, stick around – I’ll get to that in my next article.