Voice over Internet Protocol (VOIP) will play a massive role in telecommunications this year, but companies must discern between fact and marketing hype.
This is according to World Wide Worx MD Arthur Goldstuck, keynote speaker at ITWeb`s VOIP 2005: How to without the Hype conference in Bryanston yesterday.
Goldstuck said local companies are now looking for practical implementations of VOIP technology in their business.
"When the Internet first came out, you had to explain to people what it could do. They needed to be shown the benefits of e-mail, when today it is so blindingly obvious. People don`t just need to be taught about the technology, but about the benefits it offers as well.
"That is where VOIP is today. People are saying 'OK, this is the technology, now what options are available to me?`"
Citing research conducted by World Wide Worx, Goldstuck said 31% of large companies had used VOIP in 2004, while 78% plan to do so in 2005. Least-cost routing (LCR) will be the real contribution of VOIP in the short-term, he added.
"I would be very surprised if there are any companies that aren`t using or at least considering implementing LCR solutions by the end of 2005."
No free lunches
[VIDEO]Mitel EMEA strategy marketing head Campbell Williams, the international speaker at the event, said there remained a myth that offerings would be free over the Internet.
"The world`s network operators are not going to be that nice to you - everything is not going to be free over the Internet. It`s a trillion-dollar industry. But it will reduce price - it is called least-cost routing, not no-cost routing."
Multimatics IT director John Bannister said this myth was most likely caused by over-zealous marketing. "A lot of the hype has been introduced at the sales level."
Another key issue surrounding VOIP is the fact that there is little barrier to entry into the market.
Gateway Communications MD Mike van den Bergh warned that local companies should exercise caution when choosing a VOIP service.
[VIDEO]"Early competition is going to be aggressive, and there are going to be winners and losers. Cost saving and quality are going to be lessons hard learned. The local consumer has never had to be discerning, as we have only ever had Telkom. Now we are going to have to choose between different services that offer different quality."
Citing barriers to VOIP growth, Van den Bergh said regulatory uncertainty could play a role, as well as Telkom`s "anti-competitive" attitude and approach. "People want to know why Telkom works the way it does. For the same reason snakes bite - they just do.
"Monopolies are inherently hesitant to change, so they will try and thwart it, even though in this case it will actually grow Telkom`s business."
Costs and benefits
[VIDEO]Mitel`s Williams used his presentation to discuss the benefits of IP telephony (IPT). "It reduces PSTN and VPN costs, and allows for transparent networking.
"It`s easier than ever before to migrate to IPT, as broadband and IP-VPN availability continues to increase. The critical decision-making issue is now when and why to migrate users over to IPT, although I don`t think all users should do so immediately."
Multimatics` Bannister said companies should conduct research into their own business situation to determine the cost benefits of VOIP, rather than believing sales pitches.
"I have one customer who was told a different story about what VOIP will do for them by every VOIP provider they spoke to. A proper cost benefit analysis will help a company identify issues prior to implementation.
"Also, do not compare VOIP rates with Telkom rates, but rather compare it with what you are currently paying. A VOIP supplier might promise they are 70% cheaper than Telkom, but you could already be 60% cheaper."
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