That Buzz You Hear Is Voice over IP

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?

"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." — 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.

Continued on Page 2: Who's Got the Bandwidth for It?