IP-based call centers promise to cut costs and help companies provide better customer service, but they've been slow to come online.Initially, businesses are adding IP interfaces to existing time division multiplexing PBXs when they need to quickly expand call centers or installing new IP PBXs when they set up new, relatively small call centers. Today, sales of IP gear in the $1 billion North American call-center market accounts for only $69 million. Sales of IP call center gear in North America will be $824 million in 2008, according to a Frost & Sullivan projection.Adoption of IP call centers will start to take off significantly in 2005 as businesses that have installed IP PBXs to handle general phone traffic start to add call-center functionality to them, says Katrina Howell, program manager for contact center research at Frost & Sullivan. IP infrastructure that supports quality of service will be in place, and business IT staffs will have technical expertise and comfort with the technology, she says.Adding a call center in five years will be a less dramatic transition than it would be today, she says. "By then, it's just another application. It happens to be the most sensitive application, but it's just another application," she says."It's no longer if customer-interaction management will be IP-based, it's when," says Peter Williams, project manager for an IP contact-center transition underway by the Ministry of Social Development in New Zealand. The agency is migrating from\u00a0TDM \u00a0centers based on Genesys Telecommunication Labs software to an IP system using Genesys software but based on Cisco IP Call Manager gateways.While the ministry shifted to IP telephony for its 20,000 end users three years ago, it purposely left out its more than 15 call centers. It is piloting IP call-center capabilities with only 100 agents because there is too much to integrate, Williams says. "We are designing the environment needed for full production support for IP call centers, one that provides full disaster recovery and resiliency, scalability, server models that comply with the other production servers on the infrastructure, etc.," he says.When to move to IPWhile Williams is progressing toward full IP call centers, others are not so aggressive. "I don't know that we're going to make the full transition," says Keith Wallace, director of telecommunications for PC Connection, which uses a dozen IP phones to support a small contact center in Ohio to supplement its main TDM-based center in Merrimack, N.H. An IP interface extends the Nortel system in New Hampshire to Ohio.The Ohio site was taking a lot of customer calls, but had no call-center equipment. It had phone lines that would ring on multiple phones, and whoever was available picked up. But that call center didn't provide call distribution to feed calls evenly to agents. It also did not provide data about calls handled or provide information to agents about the callers, Wallace says.With an IP interface to the Nortel Symposium call center and an IP link to the Ohio office, the company had these features immediately. "This was the quickest, down-and-dirtiest way to get them going," Wallace says. He shipped a dozen phones overnight, and workers in Ohio plugged them into the LAN and electrical sockets. After that, the call center was working, he says.PC Connection's use of IP is an example of call-center virtualization - functioning as a single, unified entity, but actually is widely dispersed geographically. Agents can make and receive calls from a single queue without being in the same building with the call-center hardware. They can be anywhere as long as they have a link to the IP network, and their workstations and IP phones have routable IP addresses. Similarly, the call-center server can be anywhere on that network.The TDM option"You can do this with TDM, but it's far more complex and costly," Frost & Sullivan's Howell says. It would require an automatic call-distribution device at each site and network-based computer-telephony integration to create a queue for incoming calls.That is what drove Wallace and PC Connection to IP. Ohio was too far from New Hampshire to extend the TDM system without introducing so much delay that voice quality suffered, he says.Virtualization also has business benefits, says Patrick Miller, vice president of Network Services for Alliance One, a company based in Exton, Pa., that services debt for lenders, making calls to follow up with people who owe.The company has 20 call centers that field calls for many clients. Four of those centers are IP-based on Cisco gear, ranging in size from 60 to 350 seats. Two are stand-alone call centers, and the other two are call centers at sites where the corporate business phone system also is based on IP.The company was looking to add seats to centers, regardless of where agents are located. "Call centers change a lot in this business. We're looking for the flexibility to add people where we want to," Miller says.With Cisco IP call centers in Pennsylvania and Jamaica, a supervisory operator in Pennsylvania routes calls to agents in the Jamaica contact center. That same operator can route calls to a separate call center in Pennsylvania, something a TDM system would not allow, Miller says.Virtualization of IP lets the more highly trained operators route more calls than they could if they were isolated at a TDM call center, he says. If there is an overflow of calls, they can be routed to overflow agents who might hold other jobs, such as an administrative assistant, but fill in during crunches, Miller says.He says he likely won't buy more TDM gear because it costs more to add IP capabilities to existing TDM call centers than to add to IP centers. Adding IP to an Avaya PBX would cost the price of an IP card plus $1,800 per phone, whereas adding a phone to a Cisco IP network costs $250.Businesses also have to consider that IP can help streamline their networks, and that someday soon, IP will support call-center features that TDM cannot. Avaya says it is working on applications that would let supervisors monitor calls in near real time and benefit from voice analysis software that detects anger in voices. If calls are going badly, supervisors can tap in, figure out what's going wrong and offer suggestions via a dialog box on the agent's workstation.The key is that the IP gear works at least as well as whatever it replaces. Call centers are where businesses interact with customers, and how well the call centers work determines overall corporate profitability. "It's never about saving money on the technology side; it's about getting better service for customers," Howell says.