The slow economy, by forcing businesses to find the most cost-effective, scalable ways to migrate to IP-based communications, is shining a light on session initiation protocol, officials with a Los Angeles-based provider of SIP trunking solutions told TMCnet.
In general, SIP trunking is a service offered by Internet telephony service providers so that businesses can adopt VoIP using their Internet connection. That way, they can communicate with others who rely on the PSTN, since the enterprise IP-PBX is connected to the service provider’s PSTN gateways over the Internet.
According to Joel Maloff, senior vice president of sales and marketing at BandTel
, corporate financial executives – now more than ever – are looking for ways to tighten their operating expenses, and they’re instructing telecom teams “to find ways to reduce recurring costs.”
“SIP trunking is an ideal solution, and organizations that have lived with traditional telecom circuits are now starting to explore supplementing or replacing them with SIP trunks,” Maloff told TMC CEO Rich Tehrani in an interview, printed in full below. “This furthers the rapid expansion in SIP trunking service revenues and alternatives for customers.”
Maloff – who is speaking during ITEXPO West 2009, to be held in Los Angeles Sept. 1 to 3, on “Network Planning to Ensure Quality of Experience
” – also told Tehrani that BandTel clients have seen operating expense reductions of up to 70 percent with the company’s SIP trunking technology.
Their full exchange follows.
Rich Tehrani: What has the economic crisis taught you, and how has it changed your customers?
Joel Maloff (pictured left): The current global economic situation has sent two messages loud and clear to BandTel.
First, it is critical that every expense is carefully considered for its ROI and its impact on the enterprise mission. This is true both internally for BandTel as well as for our customers.
Secondly, however, has been the impact of the economy on interest in SIP trunking. As corporate financial executives are looking for ways to tighten their operating expenses, they have directed their telecommunications teams to find ways to reduce recurring costs. SIP trunking is an ideal solution, and organizations that have lived with traditional telecom circuits are now starting to explore supplementing or replacing them with SIP trunks. This furthers the rapid expansion in SIP trunking service revenues and alternatives for customers.
RT: How is this down economy affecting your decisions to reinvest in your company or market, if at all? Where will you invest?
JM: Investments are now receiving considerably greater scrutiny than two years ago. BandTel is focused on a very specific mission and set of objectives. If the investment does not show an immediate positive impact on business, it is likely to be deferred.
RT: What’s the strongest segment in the communications industry?
JM: I can answer this from a reverse perspective. Hardware sales are challenged these days because of cash flow issues and tightening budgets. Traditional circuit-based telephony will be increasingly under pressure from IP based services. In short, mobile telephony and IP telephony are the strongest communications segments at this time, and I expect SIP trunking to grow at a compounded annual rate of nearly 90 percent as reported by some analysts.
RT: With the rise of smartphones and netbooks, many wireless technologies, such as WiFi, appear to be poised for rapid growth. For example, we’re seeing more and more airlines add in-flight WiFi. In general, how widespread should WiFi be, in your view?
JM: I am expecting WiFi to become ubiquitous in metropolitan areas and public transportation. In addition, broadband wireless will also continue to grow and fill in the gaps between WiFi deployments.
RT: Which nation or region of the world will present the largest opportunity for your company in 2009/10?
JM: BandTel offers services in the United States and internationally. We already serve a large number of enterprises that have overseas locations and require international numbers to terminate into the United States. We expect that to continue to increase over the next several years.
JM: People use technology to solve problems. If the world economies continue to improve and confidence in the ability to finance investments increases, technology markets will also improve. In addition, disruptive technologies such as SIP trunking will continue to be a major part of streamlining costs and evolving from older communications technologies. If President Obama and the U.S. Congress continue to show leadership in strengthening the U.S. economy, technology vendors will benefit.
RT: What device or devices do you use, and what do you wish you used?
JM: I currently use a laptop computer, cell phone, SIP trunk, and SIP telephone. I do not currently use a PDA.
RT: I understand you are speaking during ITEXPO West, to be held Sept. 1 to 3 in Los Angeles. Describe your talk and tell us what companies or people should attend.
JM: I will be speaking on Service Provider Panel 12 on Wednesday 2 September at 1:15 PM on “Network Planning to Ensure Quality of Experience.” From the perspective of a SIP trunking service provider like BandTel, it is critical that a variety of inputs are considered regarding expanding existing services or adding new ones. These include marketplace analysis, customer requirements, competitive pressures, network architecture, implementation, service delivery, billing, monitoring, and trouble shooting. During my presentation, I will describe how BandTel addresses these issues and has achieved 99.999 percent availability from our core network infrastructure.
Perhaps the most significant challenge facing an IP telephony service provider is assuring interoperability with the myriad equipment suppliers available in the industry today. This session will be invaluable to people that want to understand how BandTel has achieved our record of success, those that are seeking a quality SIP trunking service provider and want to know what is “under the covers,” and those that may be interested in partnering with BandTel.
RT: Why should customers choose your company’s solutions? How do they justify the expense to management?
JM: There are a variety of reasons why BandTel stands out amongst our competition. BandTel offers superior performance and value due to our N Plus network architecture. We are solution-driven rather than technology focused. This means that we work with our customers to develop creative approaches to their needs rather than offering “one size fits all” services. Examples of these have included our offering T.38 fax solutions and integration into MPLS networks for off-net calling. We are bandwidth agnostic and do not require our customers to purchase bandwidth from us directly. We have an international focus and provide both local telephone numbers and SIP trunking solutions in multiple countries.
SIP trunking is one of the rare services today that can be readily and clearly justified to executive leadership. Our work with customers has shown that a reduction in telecommunications operating expenses of 25 percent to 70 percent is quite possible. The true reduction depends on a variety of factors, including number of locations, calling patterns, and installed equipment. SIP trunking IS “ready for prime time” today when properly understood, engineered, and delivered. Most Chief Financial Officers are looking for ways to reduce operating expense. SIP trunking offers one immediate opportunity to do so.
Learn more about BandTel at ITEXPO West — the biggest and most comprehensive IP communications event of the year. ITEXPO West will take place in Los Angeles, Sept. 1 to 3, 2009, featuring three valuable days of exhibits, conferences, and networking opportunities you can’t afford to miss. Register now.
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Michael Dinan is a contributing editor for TMCnet, covering news in the IP communications, call center and customer relationship management industries. To read more of Michael's articles, please visit his columnist page.
Edited by Michael Dinan