In This Month's Mailbag
In response to Jim Machi�s
LAN Telephony: Not Just
The IP-PBX (April 2001)
Dear Mr. Machi:
The hybrid value proposition is flawed. Merely adding an
IP gateway to a legacy PBX does not reduce the
installation, support, or maintenance expense of the
typical legacy PBX since the vendor van is still there
and the meter is running. The TDM bus is a dinosaur at
the heart of the legacy PBX network, and until you
remove it, the TCO remains inordinately high because
maintenance is still site-based.
IP means much more than the features or incremental
bells and whistles, it means more than toll bypass. As
always, it is about massive TCO reductions driven by new
multi-site management capabilities. The cost of IP
enabling a legacy PBX can easily cost as much as a
complete IP voice solution. Over time that IP voice
solution will rack up massive TCO savings.
The legacy PBX business model, with or without gateways,
etc., is still based on the Trojan Horse strategy: Sell
the system cheap, and then own the customer from the
inside. Until the issue of complexity is addressed to
the degree that enterprises can self manage their voice
networks, they will pay dearly for their dependence on
vendor support. The �Hybrid Horse� is that same
Trojan Horse: The highly trained service troops are
still inside the walls and ready to take control.
- Greg Ness
Shoreline Communications
Jim Machi Responds:
Greg,
Thanks for your response. In terms of whether or not you
think the hybrid (IP Telephony and traditional
telephony) PBX is flawed architecturally, the potential
customers that I�ve talked to like the concept since
they don�t have to jump 100 percent into the IP
Telephony pool. As you point out, a pure IP PBX has
definite advantages.
I wanted to point out the advantages of a hybrid PBX for
some potential deployment scenarios. Architecturally, I
also don�t think a hybrid PBX is simply adding an IP
gateway to a legacy PBX. To me, a hybrid PBX needs to be
architecturally designed as such, or, as you point out,
there would be problems. An hybrid PBX would also allow
for IP phones.
~~~~~~~~~~~~~~~~~~~~~~
In response to Laura Guevin�s
Points of Presence
column from April 20, 2001:
Hi Laura,
I appreciate your coverage on the Indian
Telecommunication Policy and am impressed with your
awareness and knowledge in reporting the state of
affairs as well as the snail�s pace at which progress
is being made in liberalizing India�s restrictive
policies.
What India continues to experience are the vestiges of
the British colonization, wherein the current
bureaucrats have taken on the feudal role that the
British played more than half a century ago. As a
result, we have a situation that perpetuates the
interests of the bureaucrats and the associated
government organizations at the expense of progress and
the consumer. This situation accounts for the government
legitimizing the monopolies they run and the illegal
status of VoIP. This perpetuation protects the monopoly�s
revenue stream, does not increase their losses, and
protects their jobs. It is essentially no different from
the British policy of forbidding locals to make salt,
the policy that Ghandi protested in the Salt March of
1930. (Editor�s Note: The British government had made
it illegal for Indians to make their own salt. Many
believed that this law symbolized a British-forced
dependence of Indians on the British for the basics of
life, just as they depend on salt. After 240 miles and
24 days of marching, the original 78 marchers had
increased to thousands. For weeks after, thousands were
arrested, beaten, and killed, but no one fought back.) As
a result, in today�s context, these companies, like
VSNL, who constitute modern day, legitimized mafias that
are able to impose policies that protect themselves,
allow the government to lumber along at their slow pace
and, in essence, hold the consumer hostage.
These restrictive policies also promote corruption,
which makes bribery a way of business in India.
Feudalism in India is still alive and well, and
continues to hamper progress.
Thank you again for the excellent reporting.
� Raj Shastri
Hi Laura,
I�m a telecom analyst at a sell-side research firm in
New York, and I enjoy reading your articles. What impact
do you expect India�s decision to have on Internet
telephony carriers and equipment manufacturers in the US
(NTOP, ITXC, Inter-Tel.net/Cirilium, IBAS, DDDC, GRIC,
IDTC, CLRN)? Do you think that the Internet is reliable
and robust enough to make a full changeover to VoIP? I�d
appreciate your insight on the matter.
Thanks,
- Michael Coady
Laura Responds:
Hi Michael,
I think equipment manufacturers have already realized
the benefits Internet telephony has to offer in
countries like India. I know Cisco has made a large
announcement earlier this year about investing $150
million in India�s Internet infrastructure, and will
open a research and development center there for testing
VoIP, among other things. Other manufacturers like
Arelnet have also announced partnership plays in India.
And Clarent announced a partnership today (4/20) with
D-Link to focus on VoIP in India. So I think the
announcement has already made a huge impact on the
equipment side.
As for carriers like ITXC, GRIC, and iBasis, India
offers an opportunity for them to legally broaden their
coverage and establish points of presence there. I think
managed IP networks like those of iBasis, which offers
service level agreements to customers and partners, will
be the winners in that space and will have the
reliability and scalability to endure.
I hope that this opinion helps you gain some insight
into the changing VoIP climate in India. Thank you for
your feedback.
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