TCO Study Confirms: Save Up to 40% With the Cloud

It's always been common sense that if you switch from a premise-based solution to the cloud, the savings (both in dollars and time) is substantial. However, a new TCO report comparing premise to hosted contact center software from Frost & Sullivan shows that not only is that assumption correct, but the savings get better and bigger the larger the contact center and the more solutions being used.

It's always been thought that enterprise contact centers couldn't benefit from a hosted solution. However, the study shows that over 5 years, a 500 seat contact center using full-function cloud solutions could save 43%. That's no small amount, no matter how you slice the numbers.

Following are the key highlights of the report:

  • Hosted contact center services significantly reduce TCO over premise-based systems in both three- and five-year scenarios for all 12 of theconfigurations analyzed.
  • The larger the contact center, the higher the savings with the hosted model. Over five years 100 seat centers averaged 23% savings, 250 seat centers averaged  34% savings , and 500 seat centers averaged 43% savings.
  • The more contact center applications hosted in the cloud, the more money saved. In a 100-seat contact center, for example, the five-year savings jumps from 9% for a hosted ACD to 23% for a full-function, nine-application hosted system.

All of the study’s TCO calculations take into account the costs of systems and applications, implementation, maintenance and upgrades, and hosted per-agent, per-month fees.

5-Year TCO Hosted Cost Savings % Over Corresponding Premise Deployment







ACD Only








Full Function




After seeing the numbers, and considering that with the cloud, you're always running the most current version of the software, I guess the only question left to explore is why a company wouldn't switch. You can read the full report here.

Feel free to comment below with your own premise-to-cloud experiences.