Total Cost of Ownership Tips in Favor of the Cloud

A recent Ovum publication, The Total Cost of Ownership of Cloud- and Premise-Based Contact Center Platforms, found total cost of ownership (TCO) has tipped in favor of the cloud. Not many doubted this would happen. And moving forward the gap will only widen.

Over the past five years, there’s been significant pressure on cloud contact center pricing, resulting in a downward trend that benefits customers. In 2013, Ovum research found cloud contact center costs “tended to converge” with on-premises solutions. In their 2016 report, Ovum revisited cost factors as the quality of cloud and on-premises tools have largely equalized. Below are a few key findings and observations.


Decision Factors Have Changed

Since the “cloud is more expensive” argument is now behind us, you can focus on other important factors. To make better investment decisions, consider how new platforms will address rapid and continuous shifts in “internal technological expectations” over the next 3-5 years. Ensure your vision is aligned with your supplier, and see that they have a proven track record of demonstrating the ability to execute. Specifically, Ovum suggests your technology roadmap account for:

  • Expected interaction channel landscape
  • Digital marketing customer impact
  • Customer mobility and behavioral changes
  • Size and complexity of existing infrastructure
  • Back office processing
  • Customer relationship management


Lower Cost Isn’t Enough

Ovum’s 2016 research shows cloud solutions are “notably more cost-effective” over a five-year span than in 2013. However, pure cost isn’t the only factor to consider when investing in your contact center’s future. Be sure to evaluate:

  • Architecture relevance
  • Speed of innovation
  • Scalability
  • Reliability
  • Security
  • Industry expertise
  • Geographic reach
  • Vendor relationships


Changes in the Premises Sphere

On-premises vendors have been forced to adapt pricing and business models in response to market pressures. While cloud infrastructure solutions have become more cost effective, legacy premises vendors have responded with more attractive pricing options as well.  Premises vendors have also adapted by delivering:

  • Faster development cycles (although not on par with the cloud)
  • Their own cloud solutions via acquisition
  • Hybrid premises and cloud options


These are just a few key findings and observations worth noting. For more detailed insights, download the full report: The Total Cost of Ownership of Cloud- and Premise-Based Contact Center Platforms.  If you are considering a cloud contact center solution, be sure to take a look at PureCloud Engage.

Roe Jones

Roe Jones

Roe Jones is a Product Marketing Manager for Interactive Intelligence (ININ). He has been employed at ININ for 17 years with roles in Support, Professional Services, Product Management, Cloud Services and Marketing. His areas of interest are contact centers, unified communications, and subscription pricing.