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Publisher's Outlook
September 2001

Rich Tehrani

LAN Telephony: Riding The Storm Out


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Another Year, Another Reason To Attend!
>Extending The Enterprise

As the waves of the crashing economy continue to pound the shores of our industry, it's reassuring to find that at least one segment of the Internet telephony market is enjoying some positive news. Populated by traditional PBX vendors, as well as smaller, more nimble startups, the IP-PBX market is enjoying a meaningful measure of acceptance these days. In fact, according to a recent report issued by market researchers Cahners In-Stat, "LAN telephony is set to slowly cannibalize the PBX."

Senior analyst for Voice Applications at In-Stat, Brian Strachman, tells us that, "In the beginning of 2000, most vendors were only beginning to ramp up their sales, and there was little actual revenue to speak of. Now half way into 2001 the LAN telephony market has proven itself. There are real revenues, which is rather unusual in today's market, and a growing installed base."

In my June 2001 Publisher's Outlook, I suggested that investors approach our market with cautious optimism, and reports such as the one from In-Stat just serve to prove my point. In a market downturn, companies are forced to take a good hard look at issues such as return on investment, productivity, efficiency, etc... And let's face it, companies still have to deploy communications technology. And with the focus on next-generation solutions changing from technology hype to stories of deployment, it is becoming painfully obvious to everyone but the most stubborn PBX vendors that LAN telephony has a very bright future indeed.

How bright? Well, the In-Stat report predicts that by 2005, sales in the LAN telephony market (including handsets, servers, and applications) will approach the three-billion-dollar mark. That's pretty bright! Leading the pack are several vendors whose solutions together comprise 94 percent of the market according to In-Stat. These vendors are 3Com, Alcatel, Avaya, Cisco, Shoreline, and Siemens.

Boston-based Berkeley Enterprise Partners fits the mold of many successful consultancies these days. A fast growing eCRM and professional services firm that serves the Fortune 1000, Berkeley needed a communications system that could:

  • Offer enhanced voice communications;
  • Allow them to offer better customer service to their clients;
  • Increase operational efficiency; and
  • Do all this at a reduced cost.

The company selected 3Com's NBX 100 communications system to deliver applications such as voice mail, automated attendant, computer telephony applications, and more. While the firm required the features of a sophisticated full-featured enterprise system, cost remained a key consideration. It also demanded dial tone and Internet access from the first moment upon relocating to a new office space.

According to Jay Gauthier, executive vice president of Berkeley, the 3Com NBX 100 fit the bill. "With the NBX 100 system, we have access to the advanced features of a larger, more expensive telephone system at a price we can afford. We now have a superb, cutting-edge communications system that allows us to run our business smoothly and efficiently. This is a tremendous business advantage."

Alcatel recently scored a contract for the biggest-ever installed base of IP phones in the Balkan region. The deal, with Cyprus-based financial concern Laiki Group, entails linking over 180 sites within Cyprus over a single IP network for converged voice and data. The Cyprus Popular Bank network will comprise 50 Alcatel OmniPCX 4400 IP-based communication servers. Installed at Laiki Group's main locations, these communications servers can be managed from a single central platform, allowing network administrators to easily deliver low-cost access to the Alcatel OmniPCX 4400's features, which include call servers, voice mail, unified messaging, and call center services.

Of the 2,000 people who will be connected to this network, 700 will use Alcatel's IP Reflexes terminals in their daily communications. This is the largest deployment of IP phones in the Balkan region to date.

Aware of the fact that many IP telephony implementations are add-ons to existing infrastructure as opposed to "start-from-scratch" greenfield operations, Avaya's ECLIPS portfolio allows companies the flexibility to either deploy pure IP solutions or to enhance their existing Avaya PBX with IP telephony.

Empire Technologies is a provider of networked communications on a national scale. Their product selection philosophy extends back into their own network, for what better way to experience a product that you'll be selling to other enterprises than by installing it in-house. Empire saw the IP telephony evolution coming, and after several years of watching and waiting for the right moment, decided it was time to get on board. They quickly whittled the prospective vendor list down to four. With further testing it became clear that the solution that fit their needs best was Avaya's IP600 Internet Protocol Communications Server, part of Avaya's ECLIPS portfolio.

I spoke briefly with Rich Manhire, vice president and co-founder of Empire, who told me that the firm is indeed satisfied with the Avaya solution. Among the reasons he gave was that with 60 to 65 employees using the system, many of whom work remotely, either as outside sales reps or virtual technicians, there is a tremendous cost savings benefit. Likewise, the ability to set up an office phone on someone's desk at a remote site, and have them appear as if they were in the office helps maintain a unified presence to the outside world.

Cisco continues to leverage their worldwide lead in networking to include more and more implementations of VoIP infrastructure. For example, the Swiss ski resort Glacier 3000 - Les Diablerets has implemented a Cisco VoIP solution for a rather compelling need. According to Pierre Mathey, Executive Manager of the resort, "It's important that my staff is able to communicate with each other very quickly and clearly in case of a strong storm or a rider problem. We have to make emergency decisions fast, so we need solid communications."

Improving on the resort's "legacy equipment" (walkie-talkies, poor quality cellular phones...) was not the difficult part. But Glacier 3000 - Les Diablerets wanted a solution that could grow to accommodate an expected increase of visitors as well as to offer a solid base for future telecom plans at the resort. The network comprises a Cisco 3600 series router at the base headquarters, which acts as a gateway to the PSTN. There are 13 Cisco IP phones installed at various outposts on the mountain. Likewise, the resort chose to include several Cisco 2600 series routers to connect old-world analog phones to the VoIP network. According to Mathey, "Cisco technology gives us one system for voice, video, and data rather than three systems. Our Cisco solution offers us lots of application choices and excellent technical support."

Experio Solutions, a technology consultant to some of the Fortune 1000 compared a number of legacy PBX, centrex, and IP-PBX solutions before selecting Shoreline's IP voice communications system for a 16-site nationwide deployment. Mike Shishko, CEO of Experio, mentioned several criteria that had to be met before selecting a solution; these included reliability, flexibility, and total cost of ownership. "We were looking for the best solution for our business needs, regardless of technology," said Shishko. "When you can reduce your voice management costs and enjoy a seamless voice network across multiple sites, it's easy to understand our decision."

Shoreline's newest solution (Shoreline3) is based on Distributed Internet Voice Architecture, or DIVA. The distributed architecture links multiple locations and applications into a single, IP voice network. Shoreline 3 has a distributed call control software architecture and multiple built-in redundancies designed to safeguard network availability. Likewise, Shoreline3 links all locations, users, and applications into one IP voice network, thus delivering a single view of the entire communications network and simplified administration through a single-point management interface.

German automaker BMW decided to upgrade the communications system at its production facility in Oxford, UK, and wanted to integrate the new system at the plant into the worldwide BMW corporate telecommunications network. The new infrastructure at BMW is based on two Siemens Hicom 300H platforms designed to handle the communications workload of approximately 2,500 people. Employees at the Oxford plant will also benefit from using Siemens' HiPath 450 unified messaging application -- the same as their corporate cousins in Bavaria.

The HiPath solution is Siemens enterprise convergence architecture. Designed to help companies take advantage of newer, IP-based technologies in voice and data, the solution still allows enterprises to maximize investment protection in existing infrastructure. The complete HiPath family includes over 20 different products including switches, gateways, and endpoints, such as multimedia PC clients and IP telephones.

Each of the companies mentioned above have many customers -- certainly too many to list here. But the examples above should help to illustrate the fact that companies of all shapes and sizes are turning to next-generation technology to help them achieve and maintain a competitive edge in their respective marketplaces. While early purchasers of IP-PBXs and LAN-telephony solutions often cite cost as one of the motivating factors for taking a chance on a new technology, they all agree that the promise of untold IP-based applications that might help them drive their business forward and further maintain a lead over their competition is yet another reason to deploy the latest gear. When you factor in the disaster that has been the stock market lately, it's very impressive to note that these companies, in large part due to the success of their LAN telephony solutions are weathering the storm fairly well. If you have a LAN telephony success story, I invite you to let me know. Drop me a line at rtehrani@tmcnet.com

[ Return To The September 2001 Table Of Contents ]

Another Year, Another Reason To Attend!

I just wanted to remind everyone that time is running out to register for Internet Telephony Conference & EXPO, which is taking place next month at the world-renowned Hotel Del Coronado in San Diego. The event, (October 3-5) marks the third installment of the popular and well-regarded conference and EXPO at one of Southern California's landmark locations.

NEW! IT EXPO Financing Summit
There are a great many reasons to attend this year's show, the details of which can be found on page 46 in the show preview and here. Still, I'd like to underscore a brand-new-feature that we're proud to unveil at this October's event: the IT EXPO Financing Summit! If you are an IP telephony product or services company in need of financing, you could be selected to come give your best elevator pitch to leading venture capitalists and investment bankers looking for attractive investment opportunities at the first-ever IT EXPO Financing Summit.

Applications are being accepted now. Please send a one-page proposal detailing why your company should be selected to give a presentation to firms with the money you need. For more information, or to submit proposals, please contact Marc Robins via e-mail.

Can't-Miss Conferences!
Likewise, if you are charged with managing your company's communications network, then you absolutely must come and participate in the conference program at Internet Telephony Conference & EXPO. With three full days of courses designed to help you select and implement the best solutions for your needs, it's truly a can't-miss opportunity. Because, let's face it, in today's economy you need to keep your wits about you if you're to implement cutting-edge, efficiency-enhancing technology while fulfilling the mandate for keeping costs down. Internet telephony is the perfect technology for today's economy. In fact, you can justify the purchase and deployment of a VoIP strategy at your enterprise by using a simple ROI model. Want proof? Check out the article The TCO Value Proposition, by Gayle Moss, in the January 2001 issue of INTERNET TELEPHONY Magazine.

Register Now!
The conference program at INTERNET TELEPHONY Conference & EXPO offers the best IP telephony education around. And, online registration for the conference program -- as well as for the Exhibit Hall -- is open right now! Just point your browser here and you'll find a world of choices at your fingertips. You can also register by phone at 800-243-6002. Representatives are standing by, so don't wait! Call today. And while you're registering for the show, remember, the show hotel has sold out every time we've held this event at the Del. So don't wait any longer! You can find information regarding travel and accommodations online at www.tmcnet.com/itexpo/.

[ Return To The September 2001 Table Of Contents ]

Extending The Enterprise

I'd also like to remind everyone that we're launching a new show this December. Planet PDA, The Global Summit on Handheld Productivity Solutions, is a new conference and exhibition focused on educating the enterprise about the productivity increase they can realize by implementing a handheld computing strategy in their organization.

Planet PDA is the event for educating businesses about the productivity increase they can realize by implementing a handheld computing strategy in their organization. While you may not realize it, the next explosion in communications technology is taking place right now in the form of handheld computing. Corporate executives and MIS management need a focused forum to learn about and compare new products -- and to gather research to make intelligent decisions about incorporating handheld devices into their computing infrastructure.

The conference sessions have been designed to educate corporate executives and MIS management on how to increase productivity by utilizing handheld devices for managing staff, field force automation, and generally increasing employee productivity. Attendees will discover how to integrate applications, maintain security, develop wireless connectivity solutions, and hear case studies of how companies have successfully implemented handheld devices into their enterprise.

The event will take place December 4-6 in Las Vegas, NV at the amazing Venetian Resort, which is connected to the Sands Expo & Convention Center. At The Venetian, every room is a suite. Planet PDA has secured a special $149 rate for show participants. Note the deadline for this special rate is November 3, 2001, so reserve now. Contact the Venetian today, at 1-877-857-1861 and ask for the Planet PDA rate and avoid the inconvenience of commuting to this event from a distant hotel

For complete conference information, please call Hilary Inman at 203-852-6800, ext. 146. Or, if you're interested in speaking opportunities at Planet PDA please contact John Gatens at 203-852-6800 ext. 271. For more information visit our Web site. I look forward to seeing you in Vegas this December.

[ Return To The September 2001 Table Of Contents ]

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