Download the authoritative guide: Cloud Computing 2018: Using the Cloud to Transform Your Business
Voice over IP (VoIP) has been the next big thing for several years now, but what was once hype is turning into practical discussions. All signs indicate that 2004 will finally be the year that VoIP technology arrives on a network near you — maybe even one you manage.
The idea behind VoIP is simple. If you have corporate data running all around the organization on a LAN, and between sites on a WAN, then why not packetize your voice traffic and send it over the IP infrastructure instead of using dedicated switched voice circuits?
— Charles Burns, Amicus, on VoIP implementation.
There are a number of benefits from doing this. In greenfield sites there is no need to install voice cabling, as the network infrastructure carries both data and voice. But even in existing sites, putting voice over the IP network means the availability of new telephone features, hardware can be consolidated onto a single IP PBX (with all the associated cost savings) and management can be simplified because all telecommunications can be overseen by IT staff from a single site. Telephony costs themselves are unlikely to be reduced significantly, but there is some scope for savings there, too.
The market for VoIP equipment is predicted to expand rapidly over the next few years, with worldwide growth hitting 45 percent a year through to 2007, when the market should be worth more than $15 billion, according to figures from IDC, a Farmington, Mass.-based research firm. The reason for the heightened interest in IP telephony is that the technology is now relatively mature, and because from a budgetary point of view companies are ready to take a closer look at it, according to Rogier Mol, an IDC analyst. "In 2000, people were running into the limitations of the existing TDM(time-division multiplexing) infrastructure, but many decided to continue to use it because of Y2K considerations, so they postponed VoIP for a few years. Some have now run pilot implementations and are seeing the benefits, especially in multi-site locations."
Is your company likely to benefit from VoIP? It depends. "IP telephony works really well in some situations, but not in others," said Roger Jones, business development director at Basking Ridge, N.J.-based communications company Avaya. "If you have a mid-sized organization with 500 people in a single headquarters with existing voice infrastructure, would introducing VoIP add anything? Probably not."
It's more likely to benefit organizations with one or two large sites and many smaller ones, or organizations with many remote workers, Jones said. In these cases, it's likely that the large offices have relatively sophisticated telephone switches with advanced telephony features, while the small branch offices have far less feature-rich ones that need managing and maintaining none the less.
With a VoIP infrastructure, this whole architecture can be changed. The functionality of the main office's PBX can be extended to all the branches, because it acts like a server offering telephony features to each branch over the IP network. Features such as conferencing and short-dial calling can therefore be made available to everyone, regardless of their location, and only one central voice messaging system is required for the entire organization.
Who's Got the Bandwidth for It?
One of the questions on the minds of network managers is what are bandwidth requirements of a VoIP system? After all, a small branch may have a fairly small IP data pipe connecting it to main office, and the last thing you want is for that pipe to be clogged with voice traffic.
— Rogier Mol, IDC
It turns out that there are a number of ways of overcoming this potential problem. Branch offices need be linked only by a low capacity link (say 64kbps) to get telephony functions from the head office switch, while the voice traffic from the branch can actually be routed through the conventional phone system. Or the system can be programmed so that local calls go through the Public Switched Telephone Network(PSTN), while toll calls are routed through the IP link to head offices and out through the office's central telephone trunk — until a preset amount of the bandwidth between the branch and head office is used up. Any further toll calls are then routed locally through the PSTN.
If you have remote users who access the network from home using a broadband connection, there are a number of obvious advantages of being able to dial in to an IP telephony system: For example, using a software phone and headset connected to a laptop, teleworkers can make business calls through the company switch, while accessing data at the same time. The software phone becomes a company extension, so calls to the office number are seamlessly routed to the home, and all PBX functions such as voice messaging are available — just as if the teleworker were at his or her desk. (For remote call center workers, IP telephony is particularly valuable as calls can be routed from the actual call center to a worker's home automatically, and the caller's associated information — such as account details or past transactions — can also be pushed to the teleworker's computer.
IDC's Mol said the principal advantage of VoIP is a business one: providing workers with better communications features to enable them to do their jobs more efficiently. But for the network administrator, the major concern is whether or not the network is up to the job. "Clearly the network has to be IP-based 100baseT Ethernet, Mol said, "and you would also need to look at the firewall: Will it affect the quality of voice calls? Then you need to look at the network infrastructure: How many hops does a packet have to make, as this will delay the reception of a packet."
"The most important thing is that your network components support prioritization and quality of serviceforwarding features," Mol said. "Without this no system will work properly." The surprising thing is the small amount of data that IP telephony generates. Using compression, voice traffic may consume only 6-10kbps, with a further 6kbps overhead.
A VoIP Case in Point
One company that has already implemented VoIP successfully is Amicus, a customer contact outsourcing company based in the U.K. The company moved into new offices with no existing network infrastructure, and installed an Avaya system to provide IP telephony services to 102 staff members from day one.
"The networking hardware we needed was fairly similar in price to traditional equipment, but a major cost saving was that we had to wire up only one point per employee, for voice and data combined, instead of one for voice and one for data," Charles Burns, Amicus' commercial director, said. "This made it less expensive to install, and from a support point of view it is much cheaper as there is no longer a telephony piece and an IT piece. Our IT person supports phones and computers." The company used power over Ethernet to power its IP phones, sidestepping the issue of power supplies to each phone point.
Burns says the extra functionality that IP telephony offers is valuable. "Any employee can plug his or her phone in anywhere in the building without having to get calls rerouted first, and they can access the Web from the phones using a touch screen. There are also other handy features like the ability to access the call log on the phone's screen itself."
Moving in to a greenfield site, choosing IP telephony was a no brainer financially, concludes Burns. "From an ROI point of view, if you have an existing telephone switch it is difficult to justify replacing it with Voice over IP. But if you are considering changing switch or the business is starting up, then you would be mad not to move to Voice over IP."