What is a Hosted Contact Center? Benefits and Key Differences

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Supriya Bajaj

Senior Writer:

green tickDate: September 26, 2023

In the realm of customer service, a hosted contact center has become a pivotal solution empowered by technology. This article explores the essence of hosted contact centers, their benefits, distinguishing them from on-premise counterparts, and a glimpse into their future.

Unlike traditional on-premises contact centers, where businesses have to invest in and maintain their own infrastructure, a hosted contact center allows companies to access all the necessary software and resources remotely, without the need for significant upfront costs or complex installations.

Providing better customer service is of paramount importance in current scenario as in the US, about 40% of customers stopped conducting business with a company owing to bad customer service experience. So let’s dive in to know more about how a hosted contact center can help business operations and understand its benefits and key differences.

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Expert Advice

"Hosted Contact Centers provide immense benefits that include enhanced flexibility, cost efficiency, seamless scalability, integration with existing systems, and robust data security. It is important to consider all key aspects before investing in the best service provider. This can help your business organization gain a competitive edge and increase all key bottom-line results."

What is a Hosted Contact Center?

A hosted contact center, also known as a cloud-based contact center, thrives on the cloud infrastructure, where a third-party service provider manages all the essential tools such as telephony, messaging, and analytics. Contrary to traditional on-premise centers, hosted solutions require no physical setup and enable remote accessibility. The inherent flexibility and scalability make hosted contact centers appealing to businesses of all sizes.

How is a Hosted Contact Center Different from On-Premise Contact Center?

Hosted contact centers stand apart from on-premise solutions through infrastructure management. On-premise setups demand substantial investments in hardware and software on-site, resulting in higher upfront costs. Conversely, hosted contact center setup offers a cost-effective approach, with service providers handling infrastructure, updates, and maintenance. This leaves the technicalities to the experts and allows businesses to focus on their core competencies.

difference between hosted and on premise contact center solutions

1. Enhanced Flexibility

A significant advantage of hosted contact centers is their remarkable flexibility. Businesses can effortlessly adjust their operations according to fluctuating demands, be it scaling up during peak seasons or down during quieter times. The hosted model ensures companies can adapt swiftly to ever-changing customer service requirements, resulting in optimized performance and resource utilization.

2. Improved Cost Efficiency

Hosted contact center solutions prove to be more financially viable in the long run. As companies do away with the need for physical infrastructure, considerable savings are achieved in terms of hardware costs and space utilization. Additionally, ongoing IT maintenance expenses are significantly reduced, freeing up financial resources that can be redirected to other critical business endeavors.

3. Streamlined Scalability

In the dynamic business landscape, scalability is essential for growth. Hosted contact center solutions are designed to scale efficiently, accommodating the expanding needs of businesses without compromising performance. Whether it’s an expanding customer base or new markets, the hosted model provides the necessary agility to expand without the hassle of investing in additional infrastructure.

4. Seamless Integration

Hosted contact centers seamlessly integrate with various business tools, including CRM systems. This streamlines workflows, boosts agent productivity and enhances the customer experience. By centralizing data and providing personalized interactions, businesses achieve higher efficiency and stronger customer relationships.

You May Also Read : Discover the 12 Best Call Center Software Solutions

Benefits of Hosted Call Center Solutions

Hosted call center solutions offer significant advantages to businesses. They lead to cost savings by eliminating the need for expensive on-premise infrastructure and reducing maintenance expenses. With global reach, businesses can extend their customer-service operations to international markets, catering to a broader audience. Scalability allows seamless adjustments to meet changing demands, ensuring optimized performance.

benefits of hosted call center solutions

Some of the main benefits are listed below:

1. Cost Savings

Hosted call center solutions offer cost savings by eliminating expensive upfront investments and ongoing maintenance costs of on-premise setups. With cloud-based infrastructure, businesses avoid costly hardware installations, resulting in significant financial benefits. Additionally, flexible pricing models allow businesses to pay for the exact services they need, optimizing budget allocation. Embracing hosted call center solutions enables businesses to excel in customer service without breaking the bank.

2. Global Reach

Hosted call center solutions offer global reach, thanks to the cloud’s power. Businesses can interact seamlessly with customers worldwide, overcoming geographical barriers and time zones. This global accessibility fosters customer satisfaction and loyalty across diverse international markets.

Hosted solutions ensure consistent service quality across borders, fostering international growth opportunities. With a global reach, businesses can enhance their brand presence and cater to a diverse customer base, ultimately driving customer satisfaction and loyalty on a global scale.

3. Scalability

Scalability is a crucial advantage offered by hosted call center solutions. As businesses evolve and experience fluctuations in customer demand, hosted solutions can effortlessly adapt to changing needs. Whether scaling up during peak seasons or downsizing during quieter periods, the cloud-based infrastructure allows for seamless adjustments without compromising performance.

Scalability ensures that businesses can efficiently manage their resources, providing optimal customer service and maintaining operational efficiency as they grow and respond to market dynamics.

4. Enhanced Security

Enhanced security is a paramount feature of hosted call center solutions. Reputable providers employ robust security measures to protect sensitive customer data and ensure regulatory compliance. The cloud-based infrastructure undergoes regular security updates and monitoring to thwart potential threats.

Enhanced security measures, like data encryption, secure authentication, and access controls, protect against unauthorized access. This fosters confidence and trust in the call center’s operations for both businesses and customers.

5. Efficient Resource Utilization

Efficient resource utilization is a significant advantage of hosted call center solutions. Businesses can concentrate on their core competencies and allocate resources strategically while the technical aspect is left to the experts.

Human resources, time, and budget can be directed toward improving customer service and optimizing operations. By streamlining workflows and reducing unnecessary overhead, businesses can achieve higher productivity and provide seamless customer experiences, ultimately leading to increased customer satisfaction and loyalty.

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Things to Consider Before Selecting A Hosted Contact Center Solution

Before selecting hosted contact center solutions, consider factors such as scalability to accommodate future growth, integration capabilities with existing systems, and security measures to safeguard sensitive customer data. Additionally, assess the provider’s track record, customer support, and pricing models to ensure a seamless and cost-effective solution for your business needs. Some key factors to consider include:

how to select a hosted contact center solution

1. Data Security

When choosing hosted contact center solutions, prioritize data security. Look for providers with robust encryption methods and compliance with industry standards to protect sensitive customer information from data breaches and unauthorized access.

2. Reliability and Uptime

The reliability and uptime of the hosted solution are crucial. Choose a reputable provider with a proven track record of high uptime, minimizing service disruptions, and ensuring consistent customer service availability.

3. Scalability

Consider the scalability of the hosted contact center solution. Ensure that it can seamlessly accommodate business growth and fluctuating customer demands, allowing for easy expansion without compromising performance.

4. User-Friendly Interface

An intuitive and user-friendly interface is essential for efficient operations. The hosted solution should be easy to navigate and require minimal training for agents, promoting productivity and reducing learning curves.

5. Integration Capabilities

Check the integration capabilities of the hosted contact center solution. The hosted contact center should seamlessly integrate with existing business systems, such as CRM platforms, to optimize efficiency by centralizing data and streamlining workflows.

6. Customer Support and Training

Adequate customer support and training are vital for the successful implementation and utilization of the hosted solution. Choose a provider that offers comprehensive training for agents and ongoing support to address any issues or queries that may arise.

7. Global Accessibility

Hosted contact centers break geographical barriers by providing access from anywhere with an internet connection. This global accessibility ensures seamless customer service for businesses with international operations, leading to enhanced customer satisfaction and loyalty.

8. Future-proof Technology

As technology advances, hosted contact center services will continue to evolve. The future holds exciting possibilities, including Artificial Intelligence (AI) integration, predictive analytics, and advanced sentiment analysis. These advancements will revolutionize customer interactions, creating personalized experiences that cater to individual preferences.

You May Also Like To Read: Call Center Technology: Top 5 Solutions & Key Benefits

What Does the Future of Hosted Contact Center Services Look Like?

The future of hosted contact center services is promising. We can expect more sophisticated AI-powered tools to enhance customer interactions as technology evolves. Virtual agents, sentiment analysis, and predictive analytics will become standard features, elevating customer service to new heights. Furthermore, with the rise of remote work and global operations, hosted contact centers will play an increasingly vital role in ensuring seamless customer experiences across borders.

Moreover, the rise of remote work and the global workforce will further underscore the significance of hosted contact centers. As more businesses adopt remote work arrangements and expand their operations across borders, hosted contact centers will serve as critical infrastructure to ensure seamless customer experiences worldwide.

The integration of AI-powered tools and the flexibility of remote work capabilities in hosted contact centers will revolutionize the way businesses interact with their customers.

By embracing these advancements, businesses can unlock new possibilities for customer service excellence and gain a competitive edge in the dynamic global marketplace.

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Hosted contact centers have emerged as a game-changer in the realm of customer service. Their inherent benefits of enhanced flexibility, improved cost efficiency, seamless integration, and scalability make them an attractive choice for businesses seeking optimized operations.

As technology continues to evolve, the future of hosted contact center services holds exciting possibilities, paving the way for personalized customer experiences and improved global accessibility. Embracing hosted contact centers today is the key to unlocking a brighter future for businesses and their customers.


1. What is a cloud-based contact center?

A cloud-based contact center, also known as a hosted contact center, is a customer service platform hosted in the cloud by a third-party service provider. It allows businesses to access essential customer service tools remotely.

2. What is the difference between hosted and cloud?

In the context of contact centers, “hosted” and “cloud” are synonymous. Both terms indicate that a third-party provider hosts and manages the contact center’s infrastructure and tools.

3. Is hosted and SaaS the same?

While both hosted and Software-as-a-Service (SaaS) solutions are cloud-based, they are not entirely the same. SaaS typically refers to software applications delivered over the internet, whereas hosted solutions encompass the entire contact center infrastructure.

4. What are the three basic models for hosted services?

The three basic models for hosted services are public, private, and hybrid clouds. Public clouds are shared infrastructures, private clouds are dedicated to a single organization, and hybrid clouds combine elements of both.

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