SIP trunking has been around for decades and is used by most organizations, from the largest to the smallest businesses, to make and receive phone calls that travel over the Internet. Before SIP trunking, distributed organizations relied on basic analog landlines that were in place around the world. At the most basic level, SIP trunking allows organizations to make calls over data networks, including the Internet. This gives enterprises many advantages as compared to traditional voice circuits connecting branch offices, including lower cost, faster speeds, the ability to move different types of media over the same network, and support of innovative digital services.
A research paper called The Mathematical Theory of Communication, by Claude E. Shannon, remains one of the seminal papers leading to the development of Internet Protocols (IP) as far back as 1948. In the 1970s, VoIP protocol was developed, triggering a massively disruptive revolution in the telephony world.
In 1996, a team of researchers developed a specific approach to voice over the Internet, and thereafter, SIP was standardized. Since then, the SIP protocol enables the majority of voice sessions, while analog services are fading fast into the sunset as the largest network operators in the world are shutting down legacy analog services and migrating from copper to fiber optic networks.
“Internet service providers rolled out cable and DSL, ramping down traditional analog PSTN lines,” said Jay Patel, chief product officer at Kandy (News - Alert). “With customers anticipating higher speed for their Internet connections, they swiftly opted for VoIP and the opportunity to save money by no longer paying for POTS (Plain Old Telephone Service).
“SIP trunks became popular as companies started demanding more efficient ways to make and receive phone calls among employees and in their customer contact centers,” he added. “Moving voice calls over to the Internet allowed businesses to eliminate a separate network. Now they only needed to set up and maintain one network capable of transferring any type of media.”
SIP trunks exploded in popularity, especially for large, distributed enterprises, as they allow organizations to use SIP trunking to make and receive calls to and from traditional landlines as well as mobile devices, desktop computers, and tablets. They allowed for a “soft landing” and digital transformation acceleration.
SIP trunking paved the way for Unified Communications (News - Alert) (UC) in the early 2000s, and as the telco world became more virtualized, SIP trunking helped enable Unified Communications as a Service (UCaaS) to find a place in enterprise networks.
A few years ago, MarketsandMarkets forecasted the global Session Initiation Protocol (SIP) trunking services market size would grow from $7.6 billion in 2018 to $12.7 billion by 2023. Insight Partners extended its forecast to 2027, saying the market was valued at $13.4 billion in 2019 and projected to reach $30.2 billion by 2027.
No longer considered a risky investment, the future of SIP trunking is in the digital transformation of voice communications, including embedded voice, contact centers, artificial intelligence AI / human voice applications, omnichannel CX solutions, and more.
“We were pioneers in SIP trunking, given our heritage working in and with Session Border Controller companies, including Ribbon (formerly GENBAND),” said Patel. “We have worked with many Tier One operators, Communications Service Providers (CSP (News - Alert)), MSPs, system integrators, and an exciting community of developers to blow open the creativity and possibilities that SIP trunking – delivered as a service – and digital communications make possible.”
Kandy also provides a Communications Platform as a Service (CPaaS) with telco APIs, SDKs, and developer support programs, which extend to platforms like AT&T’s (News - Alert) API Marketplace and similar platforms for other large service providers who bring powerful networks to bear. CPaaS allows developers to add customized communications functionality into existing interfaces and infrastructures using APIs. But, in order to deliver high-quality voice, messaging, chat, video, email, and security features, end users must have resilient, high-speed connectivity as well as SIP trunking in place.
“The use cases for SIP trunking combined with CPaaS are very exciting,” Patel said. “Being able to click to talk to a contact center agent, for example, from a web page or mobile app or social media post, is so much more convenient than having to dial a toll-free number. Being able to start a live video call in a field service setting with one click is another application, which has huge economic implications as it not only removes friction from the customer journey and experience, but it saves on costs dramatically.”
Contact Centers are a big part of SIP trunking growth. Contact centers often include a number of overseas locations, and enterprises benefit from buying from a single SIP trunking provider rather than regional providers. Global SIP providers can scale up with the enterprise as they expand and accommodate compliance needs for different local regulations.
“As more enterprises accelerate their digital transformation strategies, especially following the pandemic and the continuing need to support the changing work from home and other distributed models, communications technology can act as a catalyst to boost productivity and customer experiences. These enterprises moved to cloud computing steadily for all the obvious benefits over the last twenty years, and today we are seeing them move to cloud communications – to telco cloud – to become more efficient and customer friendly. By using SIP trunking and increasingly the pure cloud-based SIP Trunking as a Service (STaaS), their operations are becoming much less complicated, and their costs are significantly lower. We’ve seen immediate ROIs in the replacement of fixed lines and IP-PBX (News - Alert) we’ve been part of.”
The SIP trunking industry is big, still growing, and extremely competitive, as almost all voice is now going over the Internet and integrated with unified communications applications and WebRTC. Fast forward to 2022, and growth today is linked inextricably to the digital transformation of enterprise communications using UCaaS, CPaaS, and STaaS with the multitude of applications available with embedded voice. Unparalleled agility and scaling are being preferred in SIP trunking services. Companies in the SIP trunking services market are offering platforms that help users to take control of all communications by providing on-demand self-service SIP trunk provisioning.
Edited by
Erik Linask
