This past February we were rather impressed with the
tremendous attendance and exhibit growth at Internet Telephony Conference &
EXPO. The energy at the show was amazing and better than most shows I have
attended lately. Many people told me that they were surprised at how
positive and enthusiastic the attendees were in light of the fact that the
general media has made a habit out of detailing the financial woes of the
This is great news for the IP telephony space, which
together with wireless and contact centers, is among the strongest sectors
within telecom. It is interesting to note that there was broad
representation from the enterprise market and service provider market.
Developers (especially those of the SIP variety) were well represented at
the show as well.
Strong service provider attendance was not a complete surprise to us. TMC
Research has projected the service provider VoIP market is showing over 100
percent growth in 2003 through 2006. At that rate, the total market for
calls placed on VoIP networks will exceed 100 billion annual minutes at the
end of 2006. VoIP calls in 2002 are expected be just over 7.5 billion
minutes. This is amazing growth and is being boosted by companies like
Vonage, who have figured out how to generate volume retail
sales in the IP telephony market.
I gave a presentation at this event about the top 10 growth areas in IP
telephony and since Iï¿½ve received a number of requests for my presentation,
I decided to write about the trends in this column.
THE TOP TEN
10) Hosted communications
The ASP market imploded before it really had a chance to prove its case.
The reality is that there are many instances where the hosted model greatly
reduces capital costs and affords corporations a ï¿½pay-as-you-growï¿½ strategy
to communications. Anyone that has used a Web conferencing application such
as WebEx is familiar with hosted communications. This market will certainly
grow but it is experiencing a speed bump as the VC money, which these
startups rely upon, has dried up faster than Google returns search results.
9) IP Centrex
This is a corporate killer app and perhaps even a subset of number 10.
The problem is that most phone companies arenï¿½t good at selling things
besides cheap minutes. No one is evangelizing this market and educating
enterprises. If service providers want to survive, they better get good at
understanding, marketing, and selling IP Centrex as it really allows
corporations to have full featured telephony at rock-bottom prices.
Communications ASPs are actually well advised to partner with service
providers and offer bundled services that will be deemed as more reliable
and being provided by a more financially secure company.
8) Linux telephony
Linux is bulletproof and cheap and the hardware keeps getting more
powerful and less expensive. Linux telephony is a viable alternative OS for
IP PBXs allowing corporations to experiment with a PBX without making any
additional capital expenditure. Soft PBXs can be downloaded in minutes and
then trialed on spare Linux machines. This is an amazing development and I
believe it is very possible that Linux will be the primary OS for future
PBXs. Itï¿½s only a matter of time until we see an abundance of open-source
PBXs and add-ons as well.
7) Video Conferencing
Letï¿½s face it, video conferencing has been ï¿½right around the cornerï¿½ for
15 years. But we may finally really be there. IP telephony reduces the cost
of video conferencing and better yet, cameras are being embedded in tablets
and PDAs. Finally, most of what we want to show others isnï¿½t at our desks
anyway so it makes sense that mobile computing will be the driver for video
conferencing. I firmly believe that we will see a merging of consumer
electronic video equipment with WiFi networks resulting in video conferences
on-the-fly from theme parks and other WiFi-enabled locations. You will
eventually be able to broadcast to your family members live from Disneyland.
This technology will migrate into offices over time. If you think about it,
this bottom up approach to technology implementation is not that unusual:
The bottom up model is what propelled the Web, PDAs, and -- to some degree
Companies trying to cut costs canï¿½t downsize and layoff indefinitely --
there comes a point where you start to cut into muscle and bone of your
human resources, and cause irreparable harm. Rather, companies are finding
that a new flexibility in where and when their employees work can also shave
costs. IP telephony allows inexpensive remote access and communications to
home workers regardless of where headquarters or the employee is located. IP
communications makes this possible in a seamless and highly cost effective
5) Cable/DSL telephony
Cable companies have had the infrastructure in place for a few years to
successfully implement cable telephony. The technology works amazingly well.
Iï¿½ve been using cable telephony for years with a Cisco ATA 186 in my house
and have always been impressed with how great a solution it is, especially
when you note the low price. This Cisco device is an awesome product.
Quality is not perfect: five to 10 percent of calls can be of fair or poor
quality. Often, disconnecting and reconnecting solves this issue. Bandwidth
issues and a lack of QoS are the problem, but I believe that the quality
easily surpasses cell phones at the moment. The service makes too much sense
for cable companies not to roll it out en masse out very soon.
4) Enhanced IM
IM clients are morphing into personal communications managers. First they
began to link you to e-mail accounts and then telephony. Expect this trend
to continue and we may see these clients becoming our primary communications
SIP is becoming the dominant standard for endpoints and is the most
popular new standard enabling interoperability. As a kicker, SIP allows
developers to develop once and have their apps run on multiple SIP devices.
2) WiFi telephony
Marc Robins recently wrote the following about WiFi telephony in his Mind
Share column. It was so good that I felt it deserves reprinting.
ï¿½With a profusion of innovative wireless LAN solutions making their way
into enterprises of every stripe, it should come as little surprise that
some very smart people see big opportunity in what was left out of the
original WLAN equation.
As WiFi hot spots proliferate, momentum is building for the various
applications that take advantage of the bandwidth and ï¿½anywhere, anytimeï¿½
connectivity that Wi-Fi delivers. While wireless corporate e-mail access is
still on the tip of everyoneï¿½s tongue as the big market driver, there is
another application that is also on the top of the killer app heap -- and it
is none other than tried and true voice communications.
It makes too much sense to simply ignore: As more and more professionals
start toting their wireless handheld computers wherever they go; with
enterprise-wide Wi-Fi solutions providing seamless access to e-mail and a
wealth of corporate data; it is only natural to also want wireless access to
corporate voice services.
Iï¿½ll go a step further -- It is high time for mobile, standards-based
voice solutions that leverage the telecom infrastructure we have in place at
our companies. In fact, itï¿½s amazing to me that we are so behind the eight
ball on this. Think about the phones you use at home -- chances are 99.9
percent that they are of the portable 900 MHz ilk. Now think about the
phones you currently use at the office. Chances are 99.999 percent that they
are tethered to your desk -- not very handy when you find yourself visiting
your desk for a few minutes out of every workday. Itï¿½s time our most basic
communications technology caught up with our work lives.ï¿½
1) IP PBX
The benefits of having a single wire to the desktop (if you even need a
wire) coupled with easier management, enhanced functionality, and reduced
phone and fax costs is too tempting to ignore regardless of the economy.
2003 is the year of the IP PBX and if you havenï¿½t looked at these devices
yet for your enterprise, you really should.
To The May 2003 Table Of Contents ]