TeleConsultants IP Telephony Survey

IP Telephony Survey 2007 update  -  IPT becomes “business as usual”

TeleConsultants first IP Telephony (IPT) survey in 2002 reflected a technology high in hype and low in proven performance. Working in unknown territory our respondents then revealed both reasonable caution and unrealistic expectations. Since that time IP Telephony has established itself as a mainstream communications application and our latest survey update indicates that a real recognition and appreciation of the risks and benefits has developed.

Previously we saw implementation taking place in obvious targets for IPT - mostly greenfield locations, smaller sites and pilot projects. Now we are seeing more gradual migration from legacy sites and larger solutions.

Grant Casci, a senior consultant at TeleConsultants, comments that “IPT is no longer the new kid on the block. Instead, it has become simply a part of the working environment.”

Expected Benefits

Improved/reduced administration remains at the top of the list of expected IPT benefits but Increased functionality, (the highest ranked benefit of 2005) has dropped to number 4. This indicates market recognition that there is no link between IPT distribution of voice communications, and the enhanced functionality available through CTI solutions, a common early misunderstanding.

The perceived value of a Single Network Infrastructure has increased while the results for Tolls Savings remain the same. The Other category which naturally sits at number 5 has seen an increase, primarily around Risk Management, Single Service Providers, and Lower Cost of Ownership.

Risks

The Impact of IPT on existing networks and operations remains the major fear, now followed by Unnecessary investment of resource. Concerns over Selecting the wrong solution and Loss of investment in existing systems (and the anonymous Other) have all decreased. This is in line with the increase in implemented solutions as the market moves from “perceived” risks to the reality of “actual” risks.

Current IPT Status

Results for IPT Status show a major increase in respondents who have already implemented IP Telephony, while figures for Underway, Planning and Not Planning are all markedly down, reflecting the fact that IPT is already part of the New Zealand business communications scene.

 
Planning

Of those planning to implement IPT, most are looking at 12-36 months out. Amongst them, Migration has emerged as the preferred strategy, a turnaround from 2005 when Replacement was the more popular approach.

In the past, many projects were smaller businesses, pilot sites or greenfield environments with minimal sunk cost, which favoured total replacement. We are now seeing second phase implementations developing out of the original pilot projects. In addition, we have organisations with larger, older solutions, investing in IPT for new environments (eg new offices and expansion) while retaining much of their existing TDM equipment in order to minimise costs.

Interestingly, the results for Supplier/Partner show the emerging strength of IT providers in this area, ahead of Existing Voice and then Telcos. Casci comments that “This shows the ICT industry coming to grips with the “Black Magic” of telephony and learning to deal with the constraints of true real-time applications.”

 
Implementation

Figures from respondents in the “Implemented/About to Implement IPT” categories produce somewhat different results. While the proportion opting for the Migration strategy continues a gradual rise, Replacement has emerged here as the more used approach – although probably for the reasons discussed earlier.

We also found that their ranking of Supplier/Partners differs. Existing Voice providers are marginally preferred over IT providers. Telcos, although in third place, have dramatically increased their ranking. As noted before, we believe this relates to the increased understanding of Voice across the ICT industry.

 

In 2005 our results showed less emphasis on financial or business justification, eg Return on Investment (ROI), Total Cost of Ownership (TCO) or Total Economic Value (TEV) for IPT implementation. In 2007 the ability to clearly specify the financial benefits can be seen.

Casci sees this as a further indication of the maturity of the market – where earlier plans had to rest somewhat on assumptions about what and how the new technology could, and would, deliver, IPT is now established in the mainstream of business communications. It’s a move from a position of “Can we do it?” to one of “Get it done”.

Summary

What we see from this latest survey is that IPT-based corporate communications have become “business as usual”. IPT is now an accepted part of the solution to corporate communication needs.

Over 50% of respondents have already implemented it and another third are either planning it, or have it underway. Risks are more clearly seen – over 70% of planners recognize that IPT makes major demands of the network and that Quality of Service issues can arise if the network is not up to supporting the new application.

As IPT has joined the establishment of corporate communications, it changed the nature of company networks. No longer does IT own the network – rather, voice is the high-impact component. It is now recognised that voice no longer rides piggyback on a data network, rather it’s an IP voice network that carries data.

Now that IP Telephony is part of “business as usual” this will be our last survey. We’d like to express our appreciation to all those who participated in the survey over the last five years.
Thank You.

If you require any assistance with planning for, or implementing IPT please contact Chris Birch.

For more information:

Chris Birch
DDI + 64 9 376 8702   Mobile 021 906 863   E-mail chris.birch@teleconsultants.co.nz