VoIP: the next generation

GB Magazine on Nov 2007 by Kim Benjamin

Sold on its ability to save money, VoIP can take a while to generate a return. Instead, it’s convergence between fixed line and mobile that’s the real seller. Can you afford to ignore it?

Microsoft founder Bill Gates once observed that “anytime we have new forms of communication, it changes behaviour”. It’s an appropriate analogy for the development of VoIP (voice over internet protocol), where voice data is compressed and sent over packet-based networks, namely the internet.

The technology has thus far been sold largely on the back of its ability to reduce telephony costs, but there’s now a more compelling reason to invest in it.

Today’s VoIP is set to change the way you make and take calls because it’s underpinning the increasing convergence between fixed and mobile. Interested? You should be. Just think how many times you’ve tried to contact people only to end up alternating between their office phone, mobile and email, not to mention fumbling through a variety of contact lists on different devices.

A study of 500 businesses by Siemens found that 94% wait over five hours a week for information, causing $9m of lost productivity each year.

BUSINESS ON THE GO

With VoIP, it’s a scenario that’s set to be a thing of the past. Developments in the technology mean its strength now lies in applications, specifically the ability to provide unified communications (UC). This is where business processes are integrated with voice, video, email and instant messaging, enabling ad-hoc video and audio conferencing irrespective of location. It’s a giant leap from the more established unified messaging, which enables voice, fax and text messages to be accessed via phone or desktop.

It’s easy to see why UC benefits larger businesses, because these communications are typically disparate in such organisations. However, for businesses like yours, UC offers a simpler proposition that is just as attractive.

“For companies of between 20 and 100 users, UC offers the ability to interact from a single interface with your voicemail and see the presence of a person, whether they are online, away or busy,” says Alison Brewer, unified communications and mobility marketing manager at IP telephony provider Mitel.

You can then choose whether to leave a voicemail, start an instant messaging conversation or send an email. “You can enrich your communications by using different media,” explains Tim Stone, Cisco’s European marketing manager for unified communications. “You can turn a voice conversation into a video one and share documents.”

As a smaller business, you’ll no doubt want a system that gives you a quicker return on investment. UC can help you deliver better customer service and maximise coverage. You can increase teleworking opportunities, so your key employees can stay in touch with colleagues and customers when they’re away from the office. For s2s, a provider of secure technology platforms, UC has enabled the business to increase productivity, as well as save time and money. “We’ve saved hours per day per person as we are able to work simultaneously on the same document,” says s2s managing director Scott Nursten.

“We can write on a virtual board without being in the same room as others contributing, or even in the same continent.”

FUTURE PRODUCTIVITY

Alongside integration with data services, VoIP is also spearheading fixed mobile convergence (FMC), giving you the ability to use a single phone for incoming calls both in the office and when on the move. You can then use one handset to benefit from cheaper voice calls while in the network range.

So is it time to wave goodbye to your PBX (private branch exchange) in favour of an IP-enabled one? Recent research from Forrester, which surveyed some 516 landline voice decision-makers in the US and Europe, showed that 54% of respondents are increasing their investment in IP PBX systems and services this year.

Developments in FMC are still a long way off, so it’s likely to be a feature you’ll want in the future rather than today. But the potential offered by UC means that businesses like yours are increasingly looking to invest in VoIP – miss out now and you could be throwing away the chance of future productivity gains.

“Businesses with more than 50 users that have their own IT management capability are starting to look for a system that includes VoIP,” says Marco Pasculli, EMEA SMB leader at telephony provider Nortel.

Consider what features you need and ask yourself whether VoIP will help you deliver these more effectively. If your employees, for example, use instant messaging to communicate, or you have a salesforce that is largely mobile, ensure this is supported. It goes without saying that good voice quality is essential – noise levels, echo and speech distortion can be an issue, particularly in more complex VoIP systems.

You need to be able to control when, where and from whom you receive calls, by programming the system to follow you regardless of location, so an intuitive interface is crucial. Even the best system is of little use if only IT guys know how to operate it. If your business is spread across sites, you should have one centralised system that connects these branches, so you can benefit from free calls between users. More advanced features include integration with your customer relationship management system.

THE MAJOR PLAYERS

For a software-based system, major players include Avaya, Siemens, Cisco, Toshiba, 3com, Swyx, Nortel, Mitel and Inter-tel (which are in the process of completing a merger). Microsoft has also entered the market, partnering with Nortel to launch Office Communications Server last month. It allows businesses to integrate VoIP into their existing telephony infrastructure and will also enable users to launch a phone call from Microsoft Office applications, such as Word or Outlook. Avaya’s standard IP Offi ce 500 product, for up to 32 users, is priced at around £350 per user, while its Professional version, for up to 270 users, includes enhanced mobility and multi-site networking, and costs around £500 per user.

The Inter-Tel Starter Pack for the 5000 series, a telephone system including services such as voicemail, IP endpoints, enhanced call control from the desktop and digital and analogue support, is priced at £3,995.

Cisco, meanwhile, offers a Unified Communications 500 series for businesses with fewer than 50 users for between £150 and £250 per user, and Swyx’s IP PBX version starts from £150 per user for a 20-user system. And Siemens offers its Hi Path OpenOffice ME UC toolset for 20-150 users.

Toshiba’s Strata range caters for small and growing businesses – its C1X100 and C1200 solutions will shortly be offering new mobility solutions. In addition, mobile workers can utilise Series Integration Protocol (SIP) handsets. SIPs can talk to each other combining voice, video, games and virtual reality applications. However, Tim Wess, general manager at Toshiba’s business communications division warns that this technology needs to mature before it offers true value.

3com has launched a series of products, VCX Connect in the US this year. VCX Connect 100 is aimed at businesses with 30 to 100 users and the 200 version is for up to 250 users. Both provide traditional PBX features, but also include advanced functionality, such as unified messaging. In the US prices start at $7,000. These products will be available in the UK from January 2008, but there are no details on pricing as yet.

You can also continue to make and receive calls with standard phones by using an adapter that enables existing handsets to be plugged into a broadband connection. This is what providers such as Vonage supply, which offers a variety of plans priced between £7.99 and £18.99 a month. Skype has software that you can download for free but you’ll pay extra for your internet connection and any hardware you need such as headsets, webcams and WiFi phones. If you have a PBX infrastructure in place, there are products available that integrate Skype with your existing set-up, so you can make calls from your office desk phones.

Installation and ongoing maintenance costs can vary significantly, so it’s essential to get multiple quotes. These costs also depend very much on whether you go down the hosted or managed route. Put simply, hosted means the IP PBX is located at the vendor’s hosting centre, and managed means it’s kept on your premises. Your decision as to whether to go hosted or managed should be based on your present and future business requirements, such as size and mobility, as well as your existing telephony infrastructure (see box below).

More and more businesses are recognising the potential of VoIP and efficiency by overhauling existing communications. While it’s just one part of this equation, it’s set to be an increasingly important one.

HOSTED OR MANAGED?