VoIP, TDM share the limelight

Voice over IP and time-division multiplexing (TDM) are combining to present a unified messaging solution that VARs can offer to SMBs. The task of VARs is made difficult by the complexity of the messaging landscape and misconceptions about the nature of UM.

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With David Lemelin, senior analyst with In-Stat. In-Stat released a report written by Lamelin, "Business VoIP: Multiple Flavors Drive Growth."

Question: What is the main takeaway from your report?

Lemelin: I think one of the keys is that there are multiple flavors [of VoIP]. One of things that we are seeing in the business space is a variety of voice options where IP plays a role, from IP PBXs to hosted solutions to broadband IP telephony and even to voice-enabled IM. These applications are being used by small business and enterprises.


Question: What is the dynamic in terms of VoIP adoption?

Lemelin: It's definitely changing in the direction of IP. One thing that businesses are working through right now is what flavor of VoIP works best for them. It may vary by location or circumstance. Where they have individual remote workers, in a lot of cases, they are using broadband telephone, Vonage-type, AT&T CallVantage or Verizon VoiceWing — that kind of broadband IP solution. When they are dealing with a new location, with long-distance calling, perhaps they will use an IP PBX or maybe they will upgrade or modify the existing TDM PBX and IP-enable it. A lot of that has to do with the fact that these PBXs are on a depreciation schedule. If they have a TDM Centrex solution now, in a lot of instances what triggers movement to IP is if they are coming up to the end of the contract.


Question: VoIP has done remarkably well, but there seem to be many reasons that TDM remains strong.

Lemelin: Keep in mind that for a lot of customers, VoIP is still something pretty new. They see things like the Vonage/Verizon suit, and hear about regulatory and legal issues that need to be resolved. When it comes to VoIP, a lot of IT managers are reluctant to go to a full IP solution.


Question: Do smaller businesses have special concerns?

Lemelin: The … consideration for very small businesses with broadband connectivity is if they lose broadband connectivity, they lose their voice connection. There is hesitation on their part to go exclusively to VoIP.


Question: The big recent news, of course, is Verizon's successful protection of three key VoIP patents it holds. What does this say in the big picture?

Lemelin: I think it's a classic double-edged sword. One side is that it's raised the vulnerability of VoIP and [on the other it] speaks to the viability of VoIP. It's something that Verizon is looking to protect, and has embraced in trying to protect its patent. The downside is it really raises a lot of questions on the part of current and potential VoIP users. There still are a lot of issues to be resolved. Frankly, it's far down the road for these issues to be raised now. There has been a lot invested in pure plays. Typically, investors do a lot of work in due diligence. It's surprising. There is some hesitation and concern in existing VoIP customers, who are saying, "Hey, we're concerned that these issues are coming up."


Question: How do you see VoIP use evolving?

Lemelin: I think [the numbers are] going to continue going up. I don't think people can ignore the cost savings, but I think [people] are not just happy with cost savings. [For providers, focusing on this] is not a viable long-term value proposition. I think customers really are satisfied with features, functionality and control over presence. It's really the feature functionality and control of presence that people value about VoIP.


Question: Did the report look at any challenges to IT departments?

Lemelin: One of the challenges for IT managers is to rein in how VoIP is used in business. It is important for voice IM and client-based services [in general] to have business-grade solutions embraced by IT managers instead of there being renegade use in the corporate environment.

This Executive Briefing originally appeared in a weekly report from IT Business Edge.
This was first published in June 2007

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