TMCnet - World's Largest Communications and Technology Community



tmc logo
November 2007 | Volume 10/ Number 11
Feature Articles

Putting the IP in IP-PBXs for SMBs

By Diya Soubra

Unlike the crowd of IP-PBX vendors wanting to sell huge systems to wealthy enterprises, the somewhat fearful, frugal small business market has almost been devoid of advanced IP-PBX or key system technology, save for a few players, most of depend on open source technology. Now, however, the last barriers are falling and IP-PBX features will finally be accessible in even the smallest businesses - granted, some of these may be employing the services of a hosted services provider, but the functionality is the same as a “big iron” box.

Indeed, one wonders if the general trend will ultimately reduce business phone systems to mere commodities that you can pick up at your friendly local office supply store.

Paul Smelser, Product Manager in the Enterprise Networks Division at ADTRAN (, says, “I believe that the telephony features that most small business customers use pretty much appear on every phone system: dialtone, voicemail, an auto-attendant, and so forth. I think where the uniqueness and value-add for the solutions provider comes in is in working with the small business customer to understand the call flow in their business, how they use their phone lines, Internet access, and essentially working with them to come up with a solution as to how they manage their voice and data usage. I don’t think that can ever be commoditized.”

“I don’t know if 100 percent of PBXs are now IP-enabled, but certainly the majority are,” says Smelser. “We joined in in 2006 when we launched the NetVanta 7100, our first IP-PBX product. Of course we’ve been in the enterprise network business for a long time, with routers and switches and Internet security products. We’re the market leader in IADs [Integrated Access Devices] and do protocol conversion between things such as ATM, Voice-over-ATM, MGCP [Media Gateway Control Protocol] and now SIP [Session Initiation Protocol]-to-TDM conversions for many of the competitive carriers as well as the Incumbent Local Exchange Carriers.”

“The NetVanta 7100 is unique in that it’s a converged voice and data solution that’s only 1U [1.75 inches] high,” says Smelser. “The front of it looks like a 24-port switch. It has Power-over-Ethernet (PoE) ports. In addition to being a SIP-based IP-PBX for up to 50 users, it is also a full-featured router, PoE switch, with Layer 2 management, and a stateful inspection firewall. It includes VPN functionality, a SIP gateway and even multiplexer functionality. It’s sort of an office-in-a-box, and we position it as a single product solution for a converged voice and data network. Whereas today a solutions provider might have a router, PoE switch, firewall and a separate IP-PBX, there are a number of installation and maintenance benefits to having one product to manage with a single GUI interface. For the record, we also have a command interface customers can use if they like.”

“The product fits greenfield applications very well,” says Smelser, “and environments where the phone system needs to be replaced. If there are requirements for data networking functionality, we fit very well in that environment too. Obviously, with a limit of 50 station sets, our ‘sweet spot’ is in the 10 to 40 seat range, although we have sold a few solutions having fewer than 10 seats.”

“With the NetVanta 7100 we wanted to address the two main barriers we saw for VoIP adoption in the small business market,” says Smelser. “Most market reports will show that adoption in the small end of the business market is still in the very early stages for VoIP. We think that’s because of, first, the cost of the systems available today and, second, the complexity and the installation and maintenance which in a sense drives up the costs from the solutions provider side or even if the end user were to try to manage it himself. That’s because of the existence of multi-product solutions and those types of factors. We addressed both these issues by integrating multiple product functions into one platform in the 7100 so all of the voice, data, quality of service,VLAN and all the things you need to build a converged IP network can be founding that single product. Then we priced it very competitively for smaller businesses, less expensive than even TDM key systems or digital solutions.”

Three’s Company

Nortel ( for many years comprised one-half of the North American “duopoly” of Nortel and AT&T/Lucent.

Recently Nortel’s three top IP-PBX experts spoke to me: Ingrid Tremblay, David Beaton and Brian Taler. First up, Ingrid Tremblay, Director of Global Marketing for VoIP and UC, says, “From a trends perspective, many of us in the industry are moving toward software, and getting away from the idea of a monolithic PBX. The reality, however, is that legacy switches in the installed base customer sites were built to last, and they continue to work. Hence the desire by installed base customers to make sure that they are in fact evolving their solutions forward. Nortel specifically does have the ability to help those customers.”

“Through our relationship with Microsoft and our Innovative Communications Alliance,” says Tremblay, “we understand the vision of where people are going: a totally integrated solution set that converges voice as well as the collaborative applications that you use on a day-to-day basis, along with any new applications that may be coming down the pipe or things that live within your back office, and ultimately pulling them together to deliver new services. The ability to do that, as you can well imagine, is as a result of the industry’s movement toward IP, open standards, and the driving force of SIP. What SIP has really given us is the ability to provide presence indicators so that you can use a single phone number, a single identity, that follows you around, no matter where you go.”

“As we move past the unified communications realm, which means taking the applications and bringing them all together in a single interface,” says Tremblay, “we’ll start to move toward whole business process convergence. That’s where you start to see new architectures - they’ve actually been around for a while, such as the Service-Oriented Architecture, but they now have definite viability. You now have the ability to tie these things to other applications that take the human latency out of a process and really provide improvement. An example of that might be where you pull in an RFID type of environment, together with notification, VoIP, voice and IM. These applications can be made to touch and interact with one another without any manual human intervention.”

“Imagine a company that has a building and warehouse that does upholstering of furniture,” says Tremblay. “If I were a customer calling into that company, the company could very quickly notify or know via RFID where the truck might be that does pick-ups and would see that Truck A is in the vicinity of my call, and therefore they would dispatch via IM the pickup lot, and automatically the person can acknowledge back via their wireless or unique WiFi device and immediately there’s a ticket that’s established and set up. All of these good things go on without any human delay. This is where we’re heading.”

“There’s also a discussion going on now regarding clients at the desktop,” says Tremblay. “Do people still need phones? It’s an interesting question. While we all want mobility and certainly want to use our cell phones and PDAs, whenever we want, we want them all tied to our phone numbers. But depending on the vertical, the phone itself may take on different forms. The devices may have bigger displays and a speaker phone for use in hotel rooms. In the office, battery limitations suggest that we’ll still have wired desk phones for some time to come. Still, the look of the phone will change. Do you need to have all of the bells and whistles if you have a soft client? Maybe not. And in certain vertical industries the phone may change its appearance for that vertical.”

“At the end of the day,” says Tremblay. “I’m not sure it’s a surprise to anyone as we become software-based. The capabilities and applications are really merging together. Ironically, the applications have been there all along. But in the past we weren’t able to use them together in a seamless way. The same services with enhancements that allow you to bridge one to the other, can all be brought together and managed from a single entity easily, without key coding and complex input sequences. I can be in an audio call, push a button and now I’ve escalated things to a video call. Life is easier for the user. But this is just scratching the surface. When we really start to put these applications together in accordance with how businesses operate, along with presence and acknowledgement and single number identification, the possibilities will be endless.”

David Beaton, Senior Product Marketing Manager for Nortel’s Communications Server 1000 (CS1000), their Flagship IP-PBX, says, “The 5.0 release of the CS1000 appeared in June 2007. That’s a major release for us. We have four main ‘pillars’ or themes around this release: Reliability, Security, Openness, and Simplicity. In terms of Reliability we added some geographic redundancy capabilities, which enables each remote gateway to support network failover. In the event you lose connectivity with your main site, the immediate gateways can take over full support for all of the IP users. For Security, we enhanced encryption capabilities on the media, signaling and IP sides. We also made some enhancements around E911 regarding location services and geographic awareness depending on where the user is, and recognizing what we call ‘intelligent E911’. The ability for the system to recognize where the user is, whether they’ve dialed the wrong number by mistake, and so forth.”

“In terms of Openness,” says Beaton, “we now support some applications on COTS hardware from IBM and HP. We also support Linux and additional incremental improvements involving SIP and interoperability with service providers. Finally, we’ve greatly simplified our portfolio. We’ve simplified the architecture so that there are fewer components and yet we’ve increased the scalability by 50 percent.”

Brian Taler is Senior Product Marketing Manager for Nortel’s Communications Server 2100 (CS2100). That’s an IP-PBX for big enterprises and big institutions such as universities. Taler says, “Nortel’s 2100 aligns with many strategies of the overall enterprise business market, but its specialty is working in large centralized campus environments. We recently implemented on the CS2100 a SIP core architectureand we’re enhancing this later in 2007 with our SE10 release. We’ve taken the functionality that would have today have resided on a separate server or the MCS [Multimedia Communications Server] and embedded that software within an HP server which, in turn, inside the CS2100. So it’s an ‘in-skins’ type of application. So now within the core of the CS2100, we support not just SIP trunks but SIP lines. Initially we support the LG Nortel 6800 Series and later this year with SE10 we’ll be bringing in the 1140E and 1120E phones.”

“Along with SIP comes all of the SIP capabilities of IM, presence and multimedia calling,” says Taler. “Add a media applications server to that and you enhance the overall experience with collaboration and audio and video conferencing. You can now take advantage of a common management stream within the CS2100, which greatly simplifies things.”

“Also in SE10 we’re bringing in the integration with Microsoft OCS [Open Communications Server],” says Taler. “That’s a big thing for us too. Similar activities are occurring with the CS1000. You may have heard that Indiana University is moving from the SL100 infrastructure to a CS2100, incorporating the OCS module to achieve a common desktop across the campus and thus change the dynamics of the over all campus and student experience. We can also bring SIP into call center installations now too, along with some IVR functionality.”

Going after the True Small Business Market

As impressive as Nortel’s bigger equipment is, vendors operating at that level of the market bump into some considerable competition. Not so at the “itsty bitsy” level. Simicomm (, an IP-PBX startup, released on September 10, 2007 the new EasySpeak PBX for SMBs, based partly on the open-source Asterisk. EasySpeak PBX has additional enhancements that enable the product to be set up and running on a dedicated Linux server in about 15 minutes, rather than the 10 hours of development time that a local systems integrator is said to need to set up Asterisk for a customer. A phone line plugs into one end of the server, and IP phones plug into Ethernet ports, whereupon they are automatically provisioned and assigned an extension number based upon the order of their connection to the system.

Simicomm’s CEO Dennis Barnum says, “We’re targeting what we consider the true small business market. About 90 percent of all U.S. businesses earn a million dollars a year or less in revenue. So there are many companies out there that could potentially use this technology but, quite frankly, there hasn’t been much out there until now that is cost-effective. Combine that with their natural fear of something new, and the result is a large, underserved market.”

“We sell our system as a straight, one-time only licensing fee,” says Barnum. “We’ve developed an application that we consider to be very easy to install, use and maintain, at an attractive price. We’re looking to market it through the smaller IT and VAR firms out there that service many of these clients. Ironically, we developed it initially to serve our needs, since we couldn’t find anything to service us with a reasonable price point and feature set. Our integrated application has a gateway attached to it and we’ve recently taken part of that and have built it into a stand-alone PBX system. As I said, we target very small offices, 10 to 15 extensions, but in fact there is no limit to the number extensions we can support. The market for larger systems however, is crowded with competitors.”

A Switch at SwitchVox

On September 27, 2007, Digium, Inc., the company standing behind the Linux-based open source PBX called Asterisk, announced it had acquired SwitchVox, a major provider (60,000+ end points) of IP-PBX phone systems for SMBs.

Just before they were completely gobbled up, I spoke with SwitchVox CEO Joshua Stephens. “We just released our latest version, 3.0. In it we made many changes, upgraded many things, and increased capacity on the system. We also added some integration with Sugar CRM and SalesForce, which are pretty exciting additions.”

Whereas SwitchVox built its business by offering easy-to-use communications solutions, Digium is the progenitor and primary maintainer of the Asterisk open source telephony code, so it’s felt that the combination of the two companies should yield Asterisk-based telephony solutions that are cost effective, easier to use and more flexible than competing telephony products. Yours Truly wishes them well and will wait for the results to appear.

The PBX that’s Not Really There (Hosted Services)

Whaleback Systems ( is an interesting managed IP telephony service provider that offers an innovative broadband business phone solution for SMBs. Their broadband-based CrystalBlue Voice Service is 100 percent premises-based and software-driven, with Key System Unit features and “road warrior” functinality. Whaleback’s all-inclusive, unlimited nationwide calling package serves companies that need between five and 1,500 phone stations.

Dave Zwicker, Vice President of Marketing, says, “We sell a managed service; a business class voice solution for SMBs for about a year-and-a-half now. And we’re really seen a steady growth in our subscriber base. When we launched CrystalBlue Voice Service, we decided that the feature set was going to be directly focused on the needs of the SMB. We wanted to bring forward the key systems features they were used to in the past and have those continue to be present in an IP-grade managed service. But we also wanted to bring them into the future in terms of the features that enterprise-class PBXs have brought to much larger companies - things like Unified Communications and integrated dial plans across multi-site locations, and mobility features such as Remote, Mobile and WiFi-enabled extensions of their VoIP phones, and things like that.”

“So we put together all of the building blocks to give customers a completely turnkey service,” says Zwicker. “Our belief is that our service should be so simple that the SMB can just use it like a phone. They don’t have to do anything that they’d have to do if they owned a PBX. There are no worries about upgrades or Moves, Adds and Changes. We do everything from a central location from which the PBX functionality emanates and which we manage to the customer premise. Most importantly, we manage the call quality end-to-end: from the handset, to the handoff, to the PSTN, and over the IP environment. We have tools in our central NOC [Network Operating Center] location that enable us to see into the IP network through a multitude of carrier facilities and IP clouds, to trace the customer’s call path and then be notified whenever call quality is showing signs of degradation, such as dropped packets. Or, there could be a disruption of service and then we’ve got mechanisms for handling failover or disaster recovery.”

Whether it’s a piece of hardware or a managed service, IP-PBXs have finally gone totally mainstream. Even the smallest of businesses can now partake of big enterprise telephony features. IT

Richard Grigonis is Executive Editor of TMC’s IP Communications Group.

» Internet Telephony Magazine Table of Contents

Today @ TMC
Upcoming Events
ITEXPO West 2012
October 2- 5, 2012
The Austin Convention Center
Austin, Texas
The World's Premier Managed Services and Cloud Computing Event
Click for Dates and Locations
Mobility Tech Conference & Expo
October 3- 5, 2012
The Austin Convention Center
Austin, Texas
Cloud Communications Summit
October 3- 5, 2012
The Austin Convention Center
Austin, Texas