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Whaleback Systems Dives Deep into Managed IP Telephony Services

Whaleback Systems is a fast-growing IP telephony managed service provider based in Portsmouth, NH serving major metropolitan areas across the country. The company’s “CrystalBlue Voice” Service is based on technology developed by Whaleback and includes an on-premise IP-PBX system combined with a centralized voice quality management system for providing end-to-end service level management. Internet Telephony magazine caught up with Whaleback’s CEO and co-founder Mark Galvin to get a deeper understanding of Whaleback’s unique approach for delivering managed IP telephony services and how it stacks up against the conventional solutions available for small to mid-sized businesses.

ITMag: You have often stated that Whaleback Systems has developed a managed IP telephony service specifically to meet the needs of small to mid-sized businesses. What exactly does an SMB want from their phone systems these days?

Galvin: Well, that’s a moving target. In fact, it’s multiple moving targets. Take the small business owner for example. Most of them are accustomed to an aging key system and are very familiar with, if not dependent upon, features that have become part of their work-flow. When a call comes in, they simply press the button that’s illuminated on a multi-line phone to answer the call. If the call is meant for someone else, they can page that person to respond to a customer request promptly. So any new IP-based phone service designed for the small business owner needs to emulate those familiar key system functions while, at same time, introducing them to a wide assortment of new capabilities that will take their business to the next level.

Then there are larger mid-sized companies, usually with a small IT staff, looking to replace an old and clunky PBX system that would cost more to upgrade than to replace. This type of customer brings a very different perspective to the market place than a small business owner because they are accustomed to traditional PBX features which are required for supporting a higher call volume. They are using features like an automated attendant to answer incoming calls, music-on-hold, dedicated numbers for employees with voicemail, call screening, call forwarding and speed dialing. As they step up to the next-generation features like unified messaging, multimedia conferencing, and contact centers, many of them are looking for expert help to design, deliver and operate these more sophisticated business services.

Even though small and mid-sized companies have different needs and perspectives, they both desire the same basic business benefits from their next telephone system or service. They want their companies to look larger and more professional than their competitors, their workers to be more productive, their costs to be well under control and their phone system to be simple to use and easy to manage. Whaleback Systems was formed to meet these customer requirements head-on and in ways that conventional solutions do not.

ITMag: Explain to our readers how the technology behind IP telephony enables those benefits.

Galvin: The most important difference is the use of IP-based communications in place of the traditional TDM model with a circuit-based communications approach. By using voice-over-IP (VoIP) technology, phone calls can be carried over any packet network that provides the necessary bandwidth and quality of service. As a result, the business telephone system can be transformed from a centralized PBX with hardwired phones into a geographically dispersed community of stationary and mobile users with wired or wireless handsets and PC-based softphones to access any of their voice-related services. This allows companies to extend the reach of their phone system affordably and helps their users to stay in touch with customers, suppliers and other employees — an obvious productivity improvement for the business.

Second, the use of broadband access networks to connect central and remote sites to an IP backbone is a big technology change from the status quo. Broadband is faster and more affordable than PRI connections or analog POTS lines — and is becoming truly ubiquitous. Broadband unlocks more and more savings for the customer as their voice network grows in size and scope. With an IP network, users can make unlimited calls for a fixed monthly fee to other IP-based phones, and their service provider can offer low-cost rates for any voice traffic handed off to the PSTN. Whaleback, for example, provides customers with unlimited long-distance calls to anywhere in the U.S. and Canada for a low fixed monthly fee. As their usage goes up, their cost per call actually goes down.

Third, the use of IP telephony technology lends itself perfectly to a centrally managed, software-based approach. Once the ancient PBX hardware is replaced by a remotely managed software-based appliance, there is tremendous flexibility to enhance and customize service options to fit the unique needs of each customer. A remotely managed appliance can also provide critically important end-to-end visibility into the network infrastructure accessed by any and every user of the service.

This is where Whaleback parts company with other providers of business telephone systems and services. We believe the era of stand-alone PBX hardware connected to an expensive TDM network is over and the era of the centrally managed IP telephony service has arrived. We also believe there must be a customer premise component in the service delivery architecture in order to guarantee call quality and to provide the feature set small to mid-sized companies require. Without the premise-based ingredient, you are left with the same old fatally flawed approach used by every hosted VoIP provider in the industry today.

ITMag: Let’s talk more about the “conventional solutions”. On one hand, customers have the option of buying an IP-PBX system from a local interconnect reseller and having control over their own system. On the other hand, there are a number of hosted VoIP providers that seem to offer tremendous savings combined with the simplicity of an outsourcing model. Where do you see these solutions falling short of the mark?

Galvin: It’s just like Republicans and Democrats — totally opposing points of view with neither one truly representing the mainstream voter, or in our case, the needs of the customer. Because neither conventional solution has it totally figured out, customers, like voters, are left with a choice between the lesser of two evils. Let’s take the in-house IP-PBX for example. They are costly to own and complex to administer and upgrade. Sure, you can put the up-front capital equipment expense on a long-term lease to conserve cash, but you are still committing to the care and feeding of a system that is destined to become obsolete as technology changes. The positive side of buying an IP-PBX system is that it’s an on-premise solution, so it will provide configuration flexibility and its TDM network will deliver very good call quality, albeit at a very high price.

Now compare that option with a hosted VoIP service. Hosted VoIP solutions have a very low up-front cost, usually just the price of the IP phones, and a low monthly usage fee that is sometimes available as a flat-rate for unlimited use. The hosted VoIP alternative greatly simplifies the life of a small to mid-sized business owner, or their IT staff, because it’s an outsourced approach. However, this alternative imposes an unacceptable trade-off for the customer — improvements in savings and simplicity come at the expense of call quality, features and flexibility.

ITMag: That’s an interesting analogy. I suppose that makes Whaleback Systems the ‘independent party’ challenging a two-party system. Can you share the vision of your ‘campaign’ for CrystalBlue Voice?

Galvin: Sure, we call it “premise-based managed services”. It’s a very simple concept and we think it represents the best of both worlds. Whaleback has combined the benefits of an in-house IP-PBX with the benefits of a hosted service while removing the negatives. Like an in-house system, Whaleback installs an appliance at the customer premise to deliver advanced functionality that is customized for each unique business environment. However, with our solution, the appliance is owned and managed by Whaleback Systems. So we have removed the up-front capital equipment cost and the complexity of ongoing maintenance, support and technology upgrades. Like a hosted VoIP service, Whaleback uses VoIP technology to unlock deep cost savings for the customer combined with the expanded reach and mobility afforded by IP-based broadband networks. However, unlike hosted VoIP solutions, Whaleback manages service quality and availability around-the-clock with unmatched precision. We have eliminated the negative impact of unpredictable call quality and periodic service interruptions that many seem to believe is a necessary evil with VoIP technology. Poor call quality is not a necessary evil — it’s just evil. When designed and deployed the right way, VoIP is a powerful and cost-effective technology platform for business communications.

ITMag: To summarize, your service involves a premise-based IP-PBX combined with outsourced system management services and flat-rate pricing for unlimited use. It’s definitely a new approach, but one of the more interesting parts of your description of CrystalBlue Voice is this notion of managing end-to-end service quality — how does that work?

Galvin: It’s something we call “the science behind the service.” Unlike other hosted providers that integrate commodity hardware and software to operate an Internet-based VoIP service, Whaleback Systems is also a software development company. We have invested a significant amount of engineering resource into the network monitoring and diagnostic tools used by our Network Operations Center (NOC) personnel. It’s evolved over recent years into a comprehensive Voice Quality Management System (VQMS) that we call OrcaVision. When combined with the on-premise IP-PBX, OrcaVision allows us to manage every aspect of call quality and service availability as experienced by our customers.

Here’s how it works. Every call made by every customer is automatically tracked by OrcaVision. The software knows how to trace the call through any IP network in the world and how to gauge the quality of the call based on key performance metrics such as packet delay, loss or jitter. If any of these metrics exceed their maximum threshold values, an alert notifies our support team and an auto-response, such as re-routing calls around congestion points, will be initiated by the system. Because a chain is only as strong as its weakest link, Whaleback has designed redundancy into each link in the network path from the customer premise to PSTN gateways. I am quite comfortable in saying there is not a more robust system or service delivery architecture on the planet.

ITMag: How do you see the IP telephony market as it continues to evolve during the next five years? Who are the winners and losers?

Galvin: The race is on to build up features, drive down cost and win new customers with a winning value proposition. This year alone we have added solutions for group conferencing, contact centers, unified messaging, WiFi phones, access link redundancy and disaster recovery. All of our services are priced to deliver high customer value and are always based on a fixed monthly fee for unlimited use. For example, our OrcaMeeting conferencing service is less than $5 per user per month for an unlimited supply of minutes. There is simply no other provider with a service offering like that…anywhere. Think of how many businesses suffer enormous fluctuations in their monthly conferencing bill. We are better positioned to unlock major savings and productivity improvements for customers than anyone else in the business.

So for me, this industry is déjà vu all over again. The transition from TDM to IP telephony is another inevitable paradigm shift like we have all seen so many times before - Dial-up Internet access became broadband Internet access, pay phones became cell phones, and analog cell phones became digital cell phones. All of these changes were as inevitable as the incoming tide. Companies who resisted the change and attempted to prolong the past became technology dinosaurs while those who embraced the future, assuming they had the right technology and a solid business model, became very successful companies. Whaleback is embracing the migration to IP telephony with solid technology, happy customers and a business that is growing by 50 percent every quarter. We are extremely optimistic about the future. IT

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