The future of IP hosted services: A Q & A session with Rich Tehrani and EagleACD's Kent Charugundla.

TMC President Rich Tehrani recently got a moment to speak with Kent Charugundla, a veteran of the telecommunications industry. Kent is founder of the Eagle.net families of companies, which includes EagleACD IP Hosted Solutions, Eagle Teleconferencing Services and Eagle Communications.

RT: How are you using IP communications in your global telecom infrastructure?

KC: During last several years of global growth and progress in IP communications as they relate to the Eagle family of companies, we have been continuously investing in building our architecture and infrastructure. Our architecture of our IP hosted service platform allows any users, whether at home or an office location anywhere in the world, to take advantage of the services with just an Internet connection. This develops the optimum business model by using global connections and a distribution of information and knowledge.

Eagle employs a state-of-the-art infrastructure that uses all industry-leading standards. EagleACD represents a significant advance in contact center services. Its IP-based infrastructure allows call center agents located anywhere to interact with voice or Internet callers--regardless of whether their origin is a PSTN or IP network. This unified architecture provides a complete contact center solution in one simple package, including multimedia ACD, IVR, predictive dialing, Internet collaboration, e-mail response management, call recording, CTI-like integration and conferencing. With EagleACD's cutting-edge VOIP contact center service, your contact center can be located anywhere in the world.

Eagle uses pure IP for all inside and outside connectivity. IP allows us to interconnect via SIP with other carriers, tandem connectivity, class 4, cross-connects between PSTN-IP, applications servers, conferencing and SIP transfers all the way down to the customer's phone. IP has enabled us to achieve not only this advanced applications delivery to our customers but also an agnostic approach to the IP network.

RT: You manage a wide range of telecom services and diversified user groups. Where do you see significant growth for Internet telephony?

KC: At the moment, infrastructure services such as IP hosted services, conferencing and network connectivity services have seen the fastest pickup, because they have now reached a stage of acceptability by customers. We have expanded our network capacity considerably during last 12 months. We are seeing more customers beginning to outsource their call center infrastructure. So this continues to be very promising. Additionally, we have seen a significant upsurge of interest in voice and Web conferencing. We see an increase in URL pop-ups for CRM-based applications in relation to the IP-PBX. These are all areas we continue to be quite bullish about.

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RT: How is the IP connectivity supported?

KC: EagleNet provides complete technical and professional services support, everything from network assessment to implementation to managed services to maintenance. We allow our customers to choose the level of support they need, so customers can focus on the core business they're already managing. Our EagleACD facility utilizes dual physical entrances and dual network connections. Our backup power is supplied with onsite UPS and generators for power backup. We have utilized dedicated connections to the public switched telephone network (PSTN) to ensure the highest possible quality and reliability. This engineering, coupled with our digital class 4 switching platform, provides you and EagleACD the greatest flexibility possible in routing traffic and recovering from any potential network issues that could arise.

RT: What is your business model for IP communications?

KC: In today's competitive climate, innovation is more than just an important element to success. It is a requirement. We continuously focus on new marketing paradigms to bring new IP services. We believe that customers today need new pricing schemes and new means of delivery and support so that customers are delighted.

Moving from a fixed-cost, asset-based payment plan to a variable cost, non-asset-based payment structure is a huge innovation in the industry. We offer a true "pay as you go" service. You pay for minutes of use only. The way we deliver is by utilizing our global network. With the fixed-cost model, you are still paying for the service whether you use it or not. The idea that you pay for only what you use is a big change from the way it usually works in call centers. With the variable model, you pay for only what you use and create. We have worked hard to create a very simple relationship with our clients so they can use their platforms and have the scalability they require.

In addition, our business model is based on an "on-demand" model. In other words, we are always ready to serve your needs and accommodate your business fluctuations--that is part of our business model. You do not pay for the scalability. You can add or remove agents to grow or handle fluctuations. This is a true variable cost model; essentially, you pay if you have business. We have taken a genuine partnership approach to supporting your business objectives.

RT: You have an operation in India. What has been your experience there? What is your opinion on IP infrastructure in India?

KC: There are a number of reasons the Indian market offers better opportunities for IP communications than other countries. Five reasons are:

* Foundation: Indian companies have more than 10 years of working experience with marketing, technical, financial and customer relationships globally. They have developed a good business model to address market needs.

* Reputation: Indian companies have built an excellent reputation for delivering high quality at competitive prices; they are now credible at the global level. Indian companies for BPO services rank second after U.S. BPO firms, and India's global reputation is being recognized.

* Indian growth rates: India's economy has consistently achieved significant growth rates of approximately eight percent during last decade, and it has excellent traction.

* Market growth: Indian companies are growing very rapidly, as are their communication demands. In addition, teledensity has grown significantly, resulting in a substantial traffic surge.

* Government: The Indian government has become a very powerful and business-friendly ally in promoting companies within India by means of a series of deregulations.

During the last few years, Indian companies have become efficient and productive. They are moving away from the attitude, "Let's stay home, let's copy and let's compete on price." Indian companies are starting to internationalize more and create stronger global strategies.

India produces about two million graduates every year, representing one of the largest supplies of graduates in the world. Also, Indian call centers have established a world reputation in terms of quality, superior delivery model and an economical alternative. The BPO/call center trend in India is still in its infancy. A number of highly competent Indian enterprises have established excellent integrated onsite/offshore business models that optimize skill sets, operating efficiency, quality of service and a superb delivery system.

The trends are very positive, and the magnitude of the changes that are taking place in the business environment and company strategies is still modest. There is every reason to believe that many Indian companies will become a part of the Global 100 and Global 500 lists.

India has the advantage of a late start; as such, they are able to invest in the most advanced IP infrastructure. India is home to two of the largest fiber companies in the world--Reliance (FLAG) and VSNL (Tyco & Teleglobe). The advantages offered by these two organizations to India are very favorable due to their competitive nature of pricing and advanced IP infrastructure. Reliance and VSNL have already fibered most of India, including small villages, thus preparing India for the global market.

RT: How does an IP hosted solution help your customers?

KC: We want our customers to focus their time and money on their value-added business areas. The idea of an IP hosted solution is one of the hottest trends around.

The basic idea is to move call center infrastructure toward a utility pay-for-use model in which users can tap into vast pools of call center power and use only what they need and pay for only what they use. For customers, it promises virtually unlimited resources with no need to invest in call centers of their own. It's there when they need it.

Beside savings, what really makes a difference is the ability to access the infrastructure within a couple of days to start serving customers. We believe in need-based sourcing--no long-term contracts, no huge, fixed-lease payments, no outdated technologies and no slow turnaround times. You can get everything you require from us. Our solutions save time and money. The key is global network connectivity and a variable-cost model that lets you pay as you go and only for what you use.

RT: How instrumental have you been in promoting the use of IP communications setups for offshore call centers with your IP hosted solution?

KC: We have been serving as an IP hosted solution business for call centers for about three years. When we interviewed small and mid-sized call center operators globally, they told us they liked the idea of IP hosted solutions, but stated that their IP network needs fluctuate. For this reason, paying per month on a per-seat basis did not make economic sense. They asked us if we could address this issue.

As discussed earlier, we had a vision to bring value to our prospective customers. We pioneered a true "pay-as-you-go" pricing model. This has been well received in the global marketplace.

RT: How do you see the next generation of IP communications evolving within your infrastructure?

KC: We envision that network assets and talents will be dispersed globally. We are investing heavily in Europe and Asia. We envision that the U.S. will be leading the world in innovation, but deployment of network assets, skills and network operation will be continuously evaluated to extract maximum financial benefits.

We believe that the IP infrastructure will continue to evolve and replace the legacy system. As billions of dollars have been invested in data and voice communications infrastructures, the IP replacement will happen gradually as customers demand new features and those features can be justified economically. We expect that pricing pressure will continue to intensify, and service providers will need to successfully balance technology and economics. Companies that focus on technology only, without extracting business value, will not survive.

RT: Do you expect the hosted call center market to continue its rapid growth?

KC: During the last few years, a solid alternative to the premise-based solution has evolved. It is due to the fundamental way business operates with fluctuating demands. IP telephony has been deployed worldwide. These two powerful global forces are changing the landscape of the call center market, and every day hundreds of new agent positions are created using the IP hosted platform. To date, this penetration is relatively small, but double-digit growth is expected for at least a decade. Major players such as Microsoft, Oracle and Avaya have committed hundreds of millions of dollars to this burgeoning market. We share the same vision.

RT: Thank you for your time, Kent.