In our last two tutorials, we introduced the concept of the Hosted PBX, where the telephone switching function is moved from the customer’s premises to an application service provider (ASP). We also considered some of the benefits that could be derived from handing off this switching function (and all of its management implications) to an application service provider, or ASP).
In this tutorial, we will examine the marketplace for hosted services, in an effort to determine both the breadth and depth of hosted PBX offerings—and look at some of the issues that need to be addressed if you are considering adopting this technology.
In a December 2008 report titled Overview of the US Hosted IP Telephony Market, by telecommunication market research firm T3i Group LLC, found that market demand for off-premises voice connectivity services was increasing, and that these capabilities provided small and medium-size organizations with new capabilities that had previously been available to only larger enterprises.
As a result, these smaller businesses and branch offices have been adopting hosted IP phone services at an accelerated pace, and are projected to continue on that growth curve for the next two years.
According to Russell Horowitz, Market Research Specialist at T3i Group, “Customers are more aware of hosted IPT today than they were a year ago. Decision makers running small and medium businesses may find voice and data communications to be a complicated distraction. With services like hosted IPT they can avoid the cost and reliance on an IT staff and focus on the core businesses’ needs.”
And for those network managers that would prefer to offload at least one of their “distractions,” there are a number of companies ready to pick up the load. Horowitz’ research identified four different categories of service providers:
- Tier 1 service providers, such as AT&T and Verizon ) offer a variety of global services, with some of those services providing PBX hosting.
- Tier 2 service providers are cable operators and smaller interexchange and local carriers with a broad array of services. Their core business is not hosted telephony.
- Tier 3 service providers, such as Aptela, Bandwidth.com, M5 Networks, and Speakeasy, offer voice, data, and/or internet connectivity through hosted and trunking services.
- Wholesale Service Providers, such as Alcatel-Lucent, CommPartners, and New Global Telecom, lease their data centers and VoIP platform licenses, supporting multiple service providers through their infrastructure.
The primary focus of our research for this tutorial series will be on the Tier 3 providers that are marketing their service offerings to the enterprise. And according to the T3i Group’s report, this market segment has experienced a year-over-year growth in excess of 30 percent, with a very small ‘churn’ (customer turnover) rate of less than 3 percent. The report attributes this success (especially given the current economic conditions) to mergers, creative alliances, and other marketing programs that have been designed to leverage the strengths of hosting services to enterprise managers.
But as you might expect, not all voice hosting service providers are created equal, and the savvy network manager must do some homework before handing off their voice switching responsibilities to a third party.
Relevant questions include:
- How much experience does this hosting provider bring to the table?
- How many customers of our size and/or industry do they have?
- How is the service priced—on a per seat basis, or some other method?
- What type of broadband connection is required, and who will provide this?
- What are the costs for the different types of calls we typically make, including international calls?
- What kind of telephones does this service support? We just invested in office-full of SIP phones—can those be used?
- What type of integration is provided for external systems, such as fax and e-mail?
- How does the system support E911 calls?
- Does the provider’s network operations center operate on a 24×7 basis?
- How do you evaluate the Quality of Service (QoS)?
- What network management tools are provided, if any?
- How much time will the configuration and cutover process take?
- Who is responsible for recording and configuring the Auto Attendant greetings?
- How difficult is it to program the find me/follow me rules for individual users?
- Can the service handle telecommuters and/or road warriors?
So as you can imagine, you will want some solid answers to these and other questions before you sign up. But we have done some of that preliminary homework for you. In our next tutorial, we will begin an examination of hosted service providers and their offerings, looking at one vendor’s solution each week.
Copyright Acknowledgement: © 2009 DigiNet Corporation®, All Rights Reserved
Mark A. Miller, P.E. is President of DigiNet Corporation®, a Denver-based consulting engineering firm. He is the author of many books on networking technologies, including Voice over IP Technologies, and Internet Technologies Handbook, both published by John Wiley & Sons.