Converged Networks: The Bumpy Road To IP (see bold)
By BARBARA DEPOMPA REIMERS
August 16, 1999
Converged networks based on IP promise to carry voice, data and video traffic on a single pipe. Network managers love the idea: A converged IP network will eliminate the need for separate voice and data infrastructures, drastically streamlining staff overhead, network management and operating costs.
The vision is great. IP networks have the potential to make convergence even cleaner because they eliminate the need to make different protocols work together. Converged IP networks also could clear the way for interesting new applications, such as multimedia call centers that integrate customer messages coming in any format--phone, fax, voice mail, e-mail or online--into a single, centralized customer-care system. Other apps that will drive IP migration are Internet call waiting, distance learning, and streaming audio and video.
Despite this vast potential, many large enterprises will find the road to a converged IP network a bumpy ride riddled with roadblocks.
For starters, many companies have multimillion-dollar investments in enterprise PBX systems--equipment that takes up to seven years to depreciate. Secondly, any major network migration will take several months of pain and planning to implement. And finally, larger companies may fear exposing their highly reliable telephone networks to the downtime that's inevitable with data network servers.
There's also the issue of scalability, which is significant since many IP telephony and IP-based integrated communications platforms aren't yet scalable much above 200 users, says Lisa Alloca, director of convergent services for Renaissance Worldwide Inc., a consulting and market research firm.
Yet another obstacle is the lack of advanced features and applications for IP networks. Many of the features now taken for granted in mature PBX systems, such as high-quality services, provisioning, billing and gateway interoperability, will take time to develop on IP-based systems, Alloca says.
The result is that most large companies view IP migration as a five-year project. "Larger enterprises see the potential and possible cost savings, but consider the move [to an IP-based network] still too risky. An enterprise can lose everything by not being open for business due to some type of network or server downtime or failure," says Ray Mota, managing director of enterprise networking at the Aberdeen Group, a consulting firm.
Actually, small and midsized enterprises are getting the most out of IP networks right now, especially businesses migrating from outdated networks and phone systems. The reason: Small to midsized businesses reap immediate savings, sometimes as much as 50 percent when compared to running separate voice and data networks, according to the Aberdeen Group's Mota.
And, by moving to a single pipe that integrates voice, video and data traffic on Internet-based IP networks, small and mid-sized businesses can build advanced call center apps and other customer care services that could very well level the playing field between large and small businesses. "Advanced call center apps are one way smaller companies can compete effectively against larger companies," says Alloca.
Challenge Dairy Products Inc. is a great example of a small business that's reaping huge benefits from a converged network. The dairy is privately held, with 175 employees in nine locations throughout California. It operates three divisions: retail sales, hotel/restaurant sales and an ingredient division that ships powdered milk (for making chocolate) all over the world.
The dairy's interest in network convergence was piqued about a year ago, when Eric Grosshans, the company's network/telecom manager, attended a focus group that introduced convergence concepts and new technologies, such as IP/PBXs, to network managers. "As a company that's always looking to save money, I saw this as our opportunity to integrate phone and data networks," Grosshans says.
The dairy was in the process of centralizing its nine locations into a wide area network. Each site had its own database, systems and communications infrastructures, and transmitted nightly batch reports back and forth via modem to the company's Dublin, Calif., headquarters.
Grosshans was also aware that the company's aging phone system needed to be replaced. So when Lucent Technologies approached him about beta-testing its IP/PBX, IP ExchangeCom Server, Grosshans gave the vendor the nod.
Lucent installed four phones for a team of users at Challenge Dairy to test the IP network for voice calls. In March, Challenge started "phase one" testing, which consisted of converting voice calls to digital signals, sending those signals to the server located about 100 feet away, and then converting the signals back to analog for transmission over the analog phone network.
The company this month is just starting "phase two" testing, which integrates a DSL circuit for Internet access. Lucent will convert the calls to digital signals, and the ExchangeCom Server will choose a routing scheme, sending some calls via an analog network and others digitally to a Concentric gateway in Los Angeles; from there, the calls will hop off the digital network to travel as analog calls to the dairy's Los Angeles branch office. Outside of the flat rate the dairy pays for DSL services, the calls to its L.A. offices will be charged just like local calls.
The hope is that phase two will sell the concept. If that works as planned, Challenge Dairy will bet the farm on convergence. That's when Grosshans will be able to inform the dairy's senior management that he can reduce the company's monthly phone bill by $2,000, or 40 percent.
That's what makes converged networks so attractive.
"In smaller organizations it takes a great deal of operational overhead to deliver voice and data, and any system that can deliver both in a single infrastructure offers enormous benefits," says Alloca.
Even in branch offices of larger organizations, the new breed of emerging integrated communications platforms (ICPs) could be used to replace up to six separate devices, Alloca says. These devices could include a PBX, a LAN hub, a router, a multiplexer, a voice-mail system and a remote access server.
Renaissance Worldwide's Alloca says that using one of these ICPs in a 200-branch office network--replacing six separate devices with one--would amount to between $2.4 million and $2.8 million in capital investment savings. And greater staff efficiencies, created largely by reducing the number of employees required to manage the network devices, could add up to $9.7 million per year in additional savings, she says.
The cost savings are driving most organizations to at least explore convergence options. And while some are opting for consolidating voice and data over ATM or frame relay, ultimately most users likely will migrate to IP, analysts and vendors say.
The Slow Road
Home Depot is a good example of a large company that's slowly traveling the road to convergence. The company implemented a converged voice, data and video ATM network. The network links Atlanta-based Home Depot's Store Support Center (SSC) with 13 regional support branches--demonstrating that large companies can converge their networks today and not sacrifice quality of service or performance in the process.
In all, 7,500 users access the system, which boasts 40 percent more capacity than Home Depot's previous point-to-point router-based WAN. The big benefit: The system, which is based on 3Com PathBuilder switches, lets Home Depot run voice traffic over its WAN, bypassing per-minute toll charges. The move saves the $30.2 billion company thousands of dollars monthly.
Dan Haumann, Home Depot's senior manager of network systems, says the new system lets Home Depot dynamically allocate bandwidth, an important feature because the company used to reserve 25 percent of the WAN's bandwidth for videoconferencing. Now, the retailer allocates only the bandwidth needed for each videoconference, making it more cost-effective.
Home Depot's WAN also offers high-speed remote printing. Mainframe reports previously sent to and from field offices resulted in wasted bandwidth set aside to support printing. The company now employs IP-based printing that quickly pushes a print job through the network and releases unused bandwidth for other applications.
Home Depot began the rollout of the converged WAN in December and completed it in May. The converged WAN aggregates T1 circuits for low-cost delivery of applications from regional offices to the SSC. It relies on 13 3Com SuperStack II PathBuilder S310 WAN Access Switches, one at each regional office, connected by up to four T1 circuits to a PathBuilder S700 switch at the SSC. The SSC system incorporates a DS3 link, which lets Home Depot combine up to 28 T1s for distributing converged traffic across the WAN. The S700 switch is also connected to Home Depot's SSC PBX, a videoconferencing bridge and a data network to converge traffic.
The regional office PathBuilder devices are connected to a PBX, router and PictureTel system at each location. Unlike the routers, the PathBuilder switches let Home Depot add T1 lines incrementally, without increasing system costs.
"This is a major cost savings compared to when we had to double the cost of our architecture to add a T1 line," Haumann says.
Prior to the rollout, Home Depot's network consisted of routers and CSUs providing IP, IPX and AppleTalk services using single T1 circuits. With 25 percent of WAN bandwidth allocated to video, the retailer needed higher performance to deliver its network services.
For Home Depot, the newly converged network completes the first phase of the company's convergence plan. Next up is a test of Inverse Multiplexing over ATM to further compress voice traffic. Phase three calls for testing H.323 gateways to better leverage video traffic on the wide area network.
In the next year or so, Home Depot hopes to use videoconferencing to distribute product knowledge, training materials and video magazines to employees over the company's corporate intranet. The retailer also wants to broadcast video-based messages from executives to regional offices. And eventually, it wants to stage IP-based broadcasts of events, such as stockholder meetings.
"ATM is simply cheaper than T1-based point-to-point connections to start. Then it adds dynamic bandwidth video capabilities and throws voice capacity on top of that at a much lower price point than we could possibly get before," Haumann says.
By adding ATM switches to the current mix of PBXs, routers and other networking equipment, larger enterprises are starting to converge voice data and video traffic across their networks. Eventually, analysts and vendors maintain, a migration to IP-based networks for all traffic is likely--though it could take up to five years for larger companies to complete that transition.
An IP Future
Physician Sales & Service World Medical Inc. is another example of a larger enterprise that has converged on an ATM-based network backbone but is eyeing IP for the future. A medical products distributor with $1.7 billion in revenue, the company started taking a hard look at convergence about three years ago when it needed to link its centers (then 75) to corporate headquarters in Jacksonville, Fla.
PSS examined multiple technologies, from T1-based point-to-point to frame relay and even an IP data network. But Brian Finley, chief technology officer for PSS, says it took the CFO and CEO only five minutes to opt for an ATM network--one that would throw voice into the mix and save the company about $100,000 per month in long distance telephone expenses.
In all, PSS cut its long distance bills by 30 percent, and that money has offset the cost of the ATM network. The ATM network links the current 120 nationwide PSS distribution centers to corporate headquarters.
The company's WAN, which has been operational for more than a year, runs over Nortel's Vector ATM switches and uses Lucent Definity switches for voice traffic across the WAN. Each of those 120 branch offices also has a T1 connection linked to multiple T3s at headquarters.
The ATM network let PSS add EDI, electronic commerce and even sales force automation. PSS was able to speed the time it takes to complete sales calls by implementing a notebook-computer-based system called Instant Customer Order Network, which lets sales reps show physicians products, prices and availability, using cellular data technology linked to the ATM WAN.
Now, PSS customers with Web access can also use the company's Digital Information Access Link--essentially a Web connection through AT&T's WorldNet service--to order products online. The company is also looking into creating a "partners extranet," which will let other, typically smaller medical products companies process orders through one of PSS' distribution centers.
Finley commends the ATM gurus in AT&T's Network Operations Center for helping set up and solve many problems in implementing the ATM network. PSS next plans to explore using IP-based video technologies from Intel and Microsoft across the WAN.
"We can use this technology to train our sales reps and provide things like distance learning," Finley says.
PSS also is looking at voice over IP, but there are still degradation and quality-of-service issues that make ATM more attractive for the interim, says Finley. "Many companies are putting voice and data on ATM cells, simply because IP can't guarantee the quality of service they need," says Jim Daugherty, general manager of data services marketing for AT&T.
Ultimately, analysts and users say, businesses of all sizes should examine their networks closely and plan to migrate to a converged network at some point--even if it takes several years. Mota suggests that as bigger businesses buy new equipment, such as routers, switches, PBXs and even phones, they should make sure those devices are IP-based.
Large companies may choose to look at convergence as a two-phase process, says Bob Roman, 3Com's director of business development. The first step would be to combine voice, data and video on a single network, using ATM or any technology that can provide required levels of quality of service. The second phase would be to migrate to IP.
Roman says large enterprises should be calculating how to minimize their investments in current PBX technologies, figuring ways to make these systems co-exist in an IP network, so that in a few years they can invest in leveraging IP across the enterprise. It can be done--but IT managers should expect some bumps and bruises along the way.
Barbara DePompa Reimers is a Germantown, Md.-based freelance writer and editor. She can be reached at bdepompa@aol.com.
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