A good article on VoIP from the Financial Times for anyone who may have missed this earlier:
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Communications: VoIP technology challenges PBX
WEDNESDAY MARCH 4 1998
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By Alan Stewart
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It is only a matter of time before 'voice over Internet protocol' technology becomes essential to business communications
The marriage of voice and data on the Internet and intranets is being heralded by many as an important advance in corporate communications. According to Micom Communications, 'Voice over IP' technology (VoIP) is now suitable for large-scale business use.
VoIP allows fax and voice traffic to be transmitted using the Internet Protocol (IP) transmission method over corporate intranets and, potentially, the global Internet itself.
"VoIP technology works by creating an overlay voice and fax network on top of any existing IP data network," says Lesley Hansen, Micom's director of international marketing.
"By eliminating the need to buy expensive leased lines from telephone companies," she says, "intra-company phone and fax traffic costs may be reduced by up to 80 per cent, allowing very rapid payback on VoIP products.
The wider Internet may provide lower-quality VoIP services, however, because of difficult network conditions and varying hops between destinations, which add both delay and jitter that affect voice quality.
But Ms Hansen considers VoIP on the Internet ideal for business faxing and recording or retrieving voice mail.
So does the traditional PBX have a future? "It is no longer acceptable to sell telephone systems as essentially stand-alone voice switches," declares Chris Ellis, marketing manager, corporate networks, at Siemens GEC Communications. "They have to be able to link into existing data networks and add value to the enterprise."
Barry Castle, European public affairs manager at networking company 3Com, believes PBXs in their current form will disappear. "There will be a transition period during which VoIP gateways will compete with PBXs," he says. "In time, advanced services and products will be developed to make use of VoIP systems."
Mr Castle sees VoIP replacing traditional PBX's within five years, given that for two to three years enterprises will be motivated to trial VoIP to benefit from reduced communications costs.
"Telecommunications network operators, Internet service providers, and cable operators are investigating how they will include IP telephony in their service offerings," he says.
Enterprise PBX's will be just one of the changes ahead, according to Mr Castle. "VoIP will enable new applications that will change the way businesses operate today," he predicts. "There will be web-based call centres and electronic commerce, unified messaging, and converged communications infrastructures in enterprises."
Inherent problems will have to be remedied quickly for VoIP to take off, according to Erik Larsson, senior manager, enterprise networks marketing, at Nortel Europe. "The Internet is a packet-based network without the built-in quality of service to cope with time sensitive voice and video traffic," he says.
Mr Larsson points out that an IP data stream consists of variable length packets that makes traffic management difficult. There is no priority, so other network traffic can introduce unsustainable levels of delay in the voice traffic. "Voice over IP on a non-managed data network such as the world wide web is simply not up to the job," he maintains.
As a result, says Mr Larsson, corporations will continue to deploy managed networks which meet their demands for quality, and increasingly, the backbones of these networks will be based on the rival Asynchronous Transfer Mode (ATM) transmission protocol. "ATM has quality of service built in," he says.
Internet service provider Netcom is currently evaluating VoIP equipment from Cisco Systems. "We tested it over our backbone between Denver, Colorado and San Jose, California," says Mike Kallet, Netcom's senior vice president of products, technology and business development.
"We conducted a business call over the Internet using a speaker phone, and the quality of the call was very good." Market analyst Durlacher believes VoIP has significant obstacles to overcome before it can succeed in the marketplace, but adds there are market niches and segments where it will prevail.
As well as quality of service, the analyst sees a need for regulation at all levels through an "international charter" of the sort proposed by the European Union.
VoIP will be primarily local area network-based for at least two years, according to Durlacher, and only then will it begin to be significant on the corporate wide area network. Although converting PBX software into a VoIP-compatible gateway is relatively simple, the firm does not believe this will be widespread for at least three years.
TexasBank is already saving $2,200 per month using VoIP equipment from Micom to link its headquarters to branch offices, instead of using toll-free "800" lines. The bank's customers phone a local number, their calls are then digitised, and sent over the bank's intranet to a VoIP gateway at its head office, without customers paying any long-distance charges.
"The savings have paid for the VoIP system in less than one year," says Keith Leonhardt, vice-president of data operations. TexasBank is also using the system to carry all inter-branch voice and fax communications in compressed form, which frees up bandwidth for data connections.
"In business terms, Voice over IP technology is one of the most exciting of the recent telecommunications developments," says Micom's Lesley Hansen. Telecommunications consultants Ovum believes IP's market share will grow rapidly at more than 70 per cent a year between 1998 and 2002, by which time IP will be the dominant protocol for broadband wide area networking.
"Although the full range of potential applications is only beginning to become clear - companies can already achieve substantial cost-savings and business quality communications over their corporate intranets," says Ms Hansen. "For this reason alone, they should be waking up to VoIP as the future of business communications.">>> |
