Executive Briefing

VoIP drivers

With Matthias Machowinski, an analyst with Infonetics Research Inc., and author of a study on voice over IP (VoIP) adoption that showed spending is up 46% on the technology.

Question: Your study showed that existing VoIP users spent on average $117,000 last year on voice over IP products and you expect that to increase 9% in 2005. What's driving the growth?

Machowinski: The expenditure increase is solely related to spending on infrastructure components like call servers, phones, gateways, etc. We did not look at spending on applications.

Question: You segmented your users into small, medium and large enterprises. Which sector do you expect to grow most during 2005?

Machowinski: The smaller organizations are likely to grow faster, because they're starting off from a lower base. When we looked at adoption rates across the full range of North American organizations, we found that 4% of small and 16% of medium organizations are expected to be using IP voice products and services by the end of 2005. Large organizations will be ahead of small and medium in 2005, with 29%. Reasons for deployment can vary significantly. The larger ones tend to do so for network optimization (and the resulting cost savings); the smaller ones like reduced complexity, manageability and flexibility.

Question: There's enough packetized voice traffic on the Net right now that some consultants and engineers have started to raise the need for more bandwidth grooming and conscious Quality of Service measures to ensure voice traffic gets sufficient priority or isn't hit with too much latency. How big a concern was this for your user base, or are they leaving it up to their equipment vendors and service providers to handle for now?

Machowinski: Reliability and voice quality are definitely a concern among users, and were rated the second and third biggest barriers to deploying IP voice. For example, those vendors that offer both voice and data products have greater control in assuring that the end-solution is optimized for voice traffic. Vendors that don't have data equipment will have to rely on the data vendors for QoS. That's why we've seen a number of relationships over the past year or so between voice and data vendors.

This 3 Questions originally appeared in a weekly report from IT Business Edge.


This was first published in September 2006

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