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Industry Insight
May  2000

Jim Machi Enterprise Convergence: One Step At A Time


In most medium-sized to large businesses, the lifespan of a PBX averages five to ten years. This equipment works fine, but these growing businesses are finally seeing the much-hyped convergence era begin to take hold. Today, true opportunity lies in helping businesses ease into the converged world without having to scrap their investment in PBXs and proprietary telephone equipment. They're eager for the cost savings VoIP promises for their expanding network of remote offices and work-from-home employees.

The cry is heard everywhere: "I just bought tons of Meridian phone sets at $750 a pop! Do I really want to throw them all out?" There's also concern about how convergence helps a home worker to look like an extension on the corporate network. It's inefficient to have home employees at separate phone numbers with noisy answering machines and featureless phones. Plus, no one needs to know they're really working from home.

Can IP telephony solve this problem? Let's look where we are today. PBX voice equipment is a huge investment for most companies. According to Frost & Sullivan, in the United States there will be more than 63 million PBXs by the end of 2000. It's clear we need to incorporate all this existing equipment into the data network so that companies can feel secure transitioning into the converged world.

The first step has been deploying an IP gateway at the enterprise to take advantage of additional bandwidth provided by existing intranets. But the IP gateway still requires a company to invest in a PBX for each remote office, adding cost and upping the already substantial investment in nearly obsolete equipment. Plus, an IP gateway can't help a home-office employee access the features of an office phone, like direct call transfers or five-party conferencing.

Aside from the promise of spending less on toll calls, the VoIP gateway in its recent incarnation offered limited benefits to the enterprise. That's why it's been slower to catch on than in the public network.

The next step in convergence has the IP gateway and the PBX collapsing into a single server with enough bandwidth to offer both high-quality voice and high-speed data transmission. This is great for a growing business, which no longer needs to invest in a legacy switch.

But there's still a pressing problem causing anxiety for enterprises. "To get the benefits of IP-PBXs, do we have to replace our proprietary phones? They were expensive!" This question makes the IP-PBX proposition much less attractive to a medium-sized or large business.

Enter the concept of the PBX extender or IP adapter (or whatever trendy name ends up catching on). Companies like MCK, VTG (recently acquired by Intel), and Calista (recently acquired by Cisco) have announced plans or are deploying technology that allows an IP-PBX or RAS to interface to those pricey and reliable legacy phones. The IP adapter can extend a traditional PBX to branch offices or work-at-home users by providing an interface to the proprietary phone set. Whether licensed or reverse-engineered technology, the adapter can convert the PBX telecom protocol into voice over Internet protocol (VoIP). At the remote site, it converts the IP call back to the PBX protocol. This PBX protocol allows the phone to work just as if it were directly connected to the PBX.

This approach has numerous benefits for the enterprise. Instead of investing in a PBX, a gateway, and a separate RAS to handle data, voice, and VoIP connectivity, the enterprise virtually extends both its data network through the RAS server, and (with added hardware components and software built in) its PBX as well. At home, an employee can use an office PC containing an NIC card, which serves as both a modem and an interface to a PBX phone set. Now the home worker can communicate as easily as the office worker. Home employees can toss out their tin-can sounding answering machines. And everyone in the office can toss out the separate phone numbers for home employees.

The truth is, it's highly unlikely that all 63 million PBXs will be replaced soon with an IP-PBX and IP phones. While new shipments of IP-PBXs are growing, the real opportunity lies in leading businesses toward convergence one step at a time with solutions that protect their investment in legacy telecom equipment. The opportunity for the PBX adapter is huge. After all, there simply isn't a landfill big enough to house 63 million PBXs and millions of phones.

Jim Machi is director, product management, CT Server and IPT Products, for Dialogic Corporation (an Intel company). Dialogic is a leading manufacturer of high-performance, standards-based computer telephony components. Dialogic products are used in fax, data, voice recognition, speech synthesis, and call center management CT applications. For more information, visit the Dialogic Web site at www.dialogic.com.

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