IP Telephony: Future of Communications Networks

IP telephony is a communications technology that is tailor-made for today’s demanding and rapidly evolving business environment.

IP telephony is a next-generation technology that is changing the way companies communicate, and is reshaping the business landscape. Through the unification of voice and data networks, IP telephony enables all types of communications – audio, video and data, wired and wireless voice – run over a single Internet Protocol (IP) network. In turn, users can become more mobile, more productive with greater access to new levels of feature functionality from a diverse range of devices, including phones, PCs, personal digital assistants (PDAs) and mobile phones and can have consistent access to an array of new business communications applications.

IP telephony is sometimes considered the same as VoIP. However there are significant differences between the two. Voice over IP (VoIP) simply allows voice communications to be transmitted over a data network. For example it reduces telephone bills by eliminating charges associated with long-distance calls and international charges. IP telephony employs VoIP, but goes beyond VoIP by bringing new voice applications and business-grade capabilities to a converged network.

IP telephony also provides a collaborative framework that delivers the seamless coexistence of voice and data applications, allowing users to leverage both the voice and data capabilities made possible by a converged network.

IP telephony is a communications technology that is tailor-made for today’s demanding and rapidly evolving business environment. Its primary benefits -- mobility, cost-savings, productivity and business continuity -- are aligned with the needs of employees, and are the key reasons businesses and organizations are now implementing IP telephony.

IP telephony fulfills the promise of the virtual workplace, bringing higher mobility to employees. Employees can initiate and receive phone calls via phone, laptop, PDA or any device they choose – from anywhere, home or on the road. Sales managers can have calls redirected from their office phones to their laptops or cell phones, ensuring they never miss a customer call or sales lead.

Money Saver

Cost-savings is another key benefit from IP telephony. It can seamlessly integrate multiple branch offices, providing higher communications functionality and closer interaction among workers in different geographical locations – all while lowering capital costs. In addition, by converging your voice and data networks into one cohesive network, total system management is streamlined from a single location with reduced costs for moves, adds and changes.

According to a Gartner Group report, companies can see significantly lower costs – of up to 50 percent or better – using IP telephony networks for international voice calling vs. traditional calling. For example, at the 2002 FIFA World Cup™ Korea Japan, where the world’s largest converged network was built, IP telephony saved FIFA money on telephone bills and networking costs in the hundreds of thousands of dollars, conservatively estimated at more than US$200,000 over the month-long event.

Companies may save between 40-60 percent on installation and operation of a converged network over the total cost of ownership of separate networks. Managing a single, unified network is easier, less expensive and requires fewer resources.

New Applications

More important than savings, converged networks and Internet telephony open up new applications for users, paving the way for better customer and other relationships.

Business continuity is becoming increasingly important for businesses and organizations. IP Telephony offers a cost-effective approach to ensuring that business communications stay up and running in multi-site networks at the time they are needed most -- even when a primary location or the Wide Area Network (WAN) goes down.

Providing excellent customer service is cornerstone of successful businesses. To most enterprises good communication with their customers in a variety of ways including live phone conversations, web-based interactions, or email is or will soon be crucial for maintaining customer loyalty and repeat business. IP-based call centers offer the opportunity for businesses to communicate with their customers in new ways and reap the benefits of a lower cost infrastructure. It also allows a business to easily tap into resources across the enterprise seamlessly in order to serve customers.

Despite the various benefits from IP telephony mentioned above, for several years companies were reluctant to introduce IP telephony with low confidence in the quality and reliability of IP telephony networks. However, IP network performance has been improved and now delivers quality of service that is on par with high-performing traditional telephony systems. As a result, more and more businesses worldwide are deploying converged networks supporting IP telephony.

Driven by improved reliability and quality, the IP telephony market is growing rapidly. Based on Avaya’s research from industry sources, we expect to see the overall market for IP telephony to grow by nearly 65% in 2003 (vs. 2002.), and the market for professional services for IP telephony is even larger, growing at 95% in 2003. VoIP traffic, at 261 million minutes in 2001, is expected to leap 42 times over the next five years, to 11 billion minutes in 2006. IP Telephony: Future of Communications Networks
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IP Telephony strategies

Now it’s time to think about strategic approaches for businesses implementing IP telephony. An evolutionary approach allows businesses to migrate smoothly to IP telephony networks in a cost-effective and practical way. Companies should check whether their networking equipment is interoperable and supports an open architecture environment. This helps enterprises to keep their IP telephony infrastructure cost-effective and capable of accepting equipment from a bestof- breed vendor. When choosing a convergence partner, it’s critical to work with a vendor that not only understands data, but also has expertise in voice applications.

In addition, a detailed assessment of networks and your organization is vital for successful and efficient IP telephony implementation. Prior study on the size of a company and the capabilities of existing data networks will help gauge and ensure IP telephony’s success on a converged network. It is not enough, however, to analyze the existing data networks. It is also essential to understand the existing functionality and features of the voice networks in place as well as how to take advantage of those capabilities in a converged network. Developing and deploying a plan that smoothly migrates from existing infrastructure and applications into a fully converged network without disruption of business processes, customer service, or business applications will mark a successful move to convergence.

Another important consideration is the applications and the requirements they represent to the network. For example, if the application is a mission critical application, such as a customer order desk for a financial business, reliability is key. If growth in the business is expected, than scalability is key. Therefore, a combined view of existing voice networks, data networks, and applications as well as new applications and capabilities required is essential for success. IP telephony is another step toward the next-generation communication networks by eliminating boundaries between systems, software and services and opening up the door to more flexible and effective communication within the enterprise as well as between the enterprise and its customers.

James Haensly is the Chief Technology Officer, Avaya Asia Pacific