Customer Experience MetriCast 2023 – Contact Center Platforms Size and Spending Forecast

Author: Diane Myers, Principal Analyst; Robin Gareiss, CEO and Principal Analyst

This year’s Customer Experience MetriCast 2023 market size and forecast report for contact center platforms shows the continued movement from on-premises based contact center infrastructure to multi-tenant, cloud-based services that provide contact center operations with more flexibility and access to the latest features and capabilities.

Nearly 51% of organizations are already using contact center platforms, and another 23.1% say they plan to do so by the end of 2023. Of those companies utilizing a contact center platform, 31.8% use CCaaS, 20.5% use a dedicated hosted platform owned and managed by a third party, and 41.5% use on-premises platforms—either those fully on-premises or those physically located in a third-party data center but hosted/managed by the enterprise organization.

This report provides details on contact center platform adoption and in-depth spending, market size, forecast and vendor selection across CCaaS and on-prem/dedicated contact center platforms, along with segmentation by size and global region. Highlights of the study include the following:

• Contact center platforms are most widely used by midsize and large enterprises, ranging in size from 250 to 1,000+ employees: 56.3% to 57.4% of companies in this size range use contact center platforms today as part of their CX strategy.
• Regionally, contact center platforms are most widely adopted in North America (58.2% of companies have adopted), followed by Asia-Pacific (46.7%) and Europe (45.8%).
  CCaaS is most prevalent in North America, with 37.2% of businesses using contact center platforms, and utilized with 37.1% of the 250-999 employee segment, the largest CCaaS user base today.
• Contact center platforms owned and operated by businesses—either on-premises or in a hosted environment—are utilized most in Asia-Pacific (47.1%) and among businesses with fewer than 50 employees (44.4%).
• The global market size for CCaaS was $5.6 billion in 2022, up 30% year over year (YoY). Metrigy forecasts the market to grow at a 12% CAGR from 2022 to 2027, reaching $9.7 billion by 2027. More than two-thirds of agent seats are still on customer-owned and -managed platforms, representing significant upsell potential for CCaaS.
• There are a number of CCaaS providers, global and regional, with varying levels of capabilities. Based on 2022 CCaaS revenue, NICE is the market share leader, followed by Genesys and Five 9. Other leading providers include AWS, Talkdesk, 8x8, Vonage, Cisco, Twilio, Dialpad, UJET, Sprinklr, and others.
• The global market for dedicated contact center platforms (license and system revenue) was $3.3 billion in 2022, flat YoY as contact centers migrate to CCaaS. Metrigy forecasts the market to remain nearly flat over the forecast period with a -0.2% five-year revenue CAGR. Metrigy forecasts for on-premises contact center platforms do not include maintenance and support revenue.
• Pricing models have evolved, with vendors offering subscription-based models versus the traditional capex, one-time payment. However, one-time payment with annual maintenance contracts is the most commonly used option. 46.5% of businesses using contact center platforms use a capex model, purchasing systems and perpetual licenses and then paying annual maintenance contracts. This is in-line with 41.5% of businesses that utilize dedicated third-party platforms on-premises or in a cloud environment.
• The number of dedicated contact center platform vendors is small, with the 2022 market share leader being Genesys, followed by Avaya, NICE, Cisco, and Mitel. Moving into 2023, this will change as Genesys announced in late 2022 that it will no longer be selling on-premises contact center solutions.
  50.4% of businesses use the same vendor for their contact center and unified communications (UC) platforms, whether in dedicated platforms or as a service (UCaaS/CCaaS).
• Among companies that use dedicated contact center platforms, 39.3% have no plans to replace their primary vendor. The rest are either replacing, have plans to replace, are evaluating whether to replace their provider, or they are unsure. Desire for a single, integrated platform for contact center and UC is the top reason businesses are changing or evaluating a vendor change, followed by moving to CCaaS.
• Among those using CCaaS, 38.7% have no plans to replace their primary provider. High costs are the number one reason for looking to make a change, followed by the lack of AI capabilities with current CCaaS providers.
• We track the percentage of each provider’s customers that plan to stay with that provider, as well as the percentage that are evaluating or planning a switch to new provider. AWS, Cisco, Five9, and Zendesk are the top providers under evaluation for new business.

• About the MetriCast Service
  • About the Customer Experience MetriCast Study
• Technology Definition
• Executive Summary
• Contact Center Platform Adoption Plans
  • State of Adoption - Contact Center Platforms (Global)
  • Contact Center Platform Adoption, by Company Size
  • Contact Center Platform Adoption, by Region
• Contact Center Architecture
  • Primary Contact Center Architecture, by Company Size
  • Primary Contact Center Architecture, by Region
• Contact Center Platform Spending Projections
• Contact Center Platform (Company Owned) Market Size & Forecast
  • Spending by Company Size
• Company-owned Contact Center Platform Vendor Overview
  • Vendors Offering Contact Center Platforms
  • Provider Replacement Plans
• CCaaS Market Size & Forecast
  • CCaaS Forecast
  • Spending by Company Size
• CCaas Vendor Overview
  • Providers Offering CCaaS Solutions
  • Provider Replacement Plans
• Technology Providers – Gaining or Retaining Customers?
• Contact Center Gain/Retain
• Conclusion