The simplest way to give a sense of whether VOIP technology would be an attractive proposition for any particular individual or business would be to describe the most common usage scenarios.
Changing voice communication facilities or infrastructure is a rather disruptive affair, since it is such a critical mode of communication. Naturally, organisations would only consider changing to VOIP-based technology if it were highly compelling to do so, whether for efficiency, flexibility, or more likely cost benefit reasons.
So is the case for switching to VOIP compelling enough in SA to elevate the technology to a prime time position? The answer to this is largely dependent on requirements, as the application of VOIP technology is highly varied.
International calls
By far the best international call rates for South Africans are from international broadband (usually PC-based) VOIP providers. The likes of Skype (proprietary) and VOIPBuster.com (SIP-based) offer rates up to 90% cheaper than the local incumbent fixed-line provider.
In order to reap the cost benefits of these cheap rates, one would have to use these services over a low-cost broadband technology such as ADSL. However, here lies the catch, as the providers are internationally based and local broadband services are highly contended on international transit bandwidth, so there is no guarantee of voice quality consistency.
Low-cost rates over low-cost access services are just as appealing to (particularly small) businesses, but their requirement for a more deterministic service where conversational accuracy can be maintained is of greater importance. Therefore a good compromise would be to use local VOIP over broadband providers, whose rates may not match those of the international providers but still offer healthy savings of up to 60%.
By relaying calls internationally via their own QoS managed bandwidth, they only have to utilise the national portion of local broadband networks, which are minimally contended compared to international, thus ensuring far more consistent voice quality.
Larger organisations and call centres with higher volumes of international call traffic should consider lease line IP access services to provide the highest levels of voice quality and consistency. Such services usually have a defined contention ratio backed by a service level agreement guaranteeing that the VOIP experience will be virtually indistinguishable from traditional circuit switched calls.
National calls
Many in the industry believe it`s only a question of time before the regulator exercises some measure of intervention on interconnection rates.
Roman Hogh is product development manager at MWEB Business.
While the rate differentials between traditional and VOIP-based services to national landline and mobile destinations are not as substantial as international ones, the call volumes to national destinations are generally far higher, therefore the opportunity to save larger monetary amounts is also higher.
Rates that are 15% to 30% cheaper hardly seem worth the effort. However, many VANS use per-second billing, which has a significant impact on savings as the incumbent networks generate a sizable amount of revenue from `unused minutes` derived for their minimum call charges and fixed period billing blocks.
The primary reason for the less than stellar rate differentials is the high costs of wholesale interconnect rates being levied by the incumbent landline and mobile providers. Many in the industry believe it`s only a question of time before the regulator exercises some measure of intervention on interconnection rates, which should provide additional scope for VANS providers to drive down the pricing of national calls.
In the mean time, individuals and businesses can avoid these high interconnect rates by bypassing the incumbent networks altogether. Full interconnection between all the major VANS providers is at an advanced stage, with the likelihood of interconnect rates between them being lower than current norm. If one can ensure that a high percentage of frequently contacted associates and business partners also make use of VANS providers for VOIP services, national (non-mobile) call costs can be reduced by up to 50%.
Inbound calls
Many of the larger VANS are deploying or already have operational bi-directional interconnects with the incumbent fixed-line and mobile networks. Besides ensuring the highest outbound call quality, these interconnects also allow VANS customers to receive calls on their issued 087 numbers from the interconnected networks.
On a technology level, this ensures the VANS` VOIP-based services closely match those of traditional telcos; however, the situation is again let down by the regulatory side (or rather lack thereof). Unfortunately, the incumbents have chosen to price their rates to VANS networks at levels that make calling 087 numbers highly unattractive to their customers.
Ready or not?
On face value, it would seem the answer is a bit of a mixed bag, but in reality the only true obstacle facing VOIP-based services in SA is the regulatory arena.
Once this situation improves, there is no reason why VANS should not be viewed as credible, cost-effective alternate voice providers.
That said, if one makes the effort to analyse their call patterns and associated costs, it should not be difficult to find particular usage scenarios where substantial cost savings on voice communication can be gained today.
* Roman Hogh is product development manager at MWEB Business.
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