John Blake, Head of VoIP, BT Global Services


The Time To Invest in VoIP?

When household names such as Cisco, Motorola, Microsoft, BT and Nokia hit the mainstream media with plans to unite mobile telephony and the internet, the world should sit up and take note. But is it time to do more than just test the water? Let's face it, mobile phones cost organisations a great deal of money. In part, it's because calls are more expensive. That's not a problem when people are working away from the organisations offices – the ability to keep in touch delivers benefits that offset the additional costs.


But increasingly employees are using their mobile phones as their principal means of making and receiving calls, whether or not they are in an office where a lower cost alternative is available. They value the convenience of knowing that calls will reach them wherever they are, and of being able to make calls easily to people whose numbers are stored in their directory. Unfortunately, it's a convenience that comes at a cost. Over half the organisations contacted in a recent survey expected the cost of mobile phone calls to rise between 2004 and 2007, some by as much as 25 per cent [1].

Then there's the added cost of managing a ‘fleet' of mobile phones. While organisations usually manage provision of desk-based phones centrally, mobile phone services are often bought locally. This dilutes the organisation's ability to use its purchasing power to get the best deal and can result in the cost of supporting a mobile user being up to three times that of a fixed-line user [2].

Little wonder, then, that mobile phone costs are an increasing concern. But what's the answer? Right now, the best option is to manage mobile phone usage more effectively, perhaps taking advantage of the option to outsource the task to a managed service supplier that can meet the organisation's needs worldwide.

In the longer term, however, technical innovations such as Voice over Internet Protocol (VoIP) and fixed/mobile convergence will have a great deal to offer.

Call IP for a great deal

Once the preserve of the cost-conscious techno-savvy consumer and of far-sighted IT-focussed business, VoIP has been combined with other technologies to create IP telephony – a way of making phone calls over data networks that can match the performance of traditional phone systems and operate fully as a part of the global phone network.

Today, IP telephony is very much a mainstream technology, used by organisations worldwide to deliver phone services to their employees. The benefits begin with lower operational costs, made possible because IP phones share cabling and equipment with the organisation's IT systems.

But that's just the start. IP phones aren't just phones – there's a computer at their heart, and that means they can offer functions similar to those available on, say, PDAs. Phone directories, diaries and so on. And IP phones are more flexible than traditional phones. Rather than being defined by building wiring, phone numbers can be assigned when users log in, allowing people to make any desk their desk. The behaviour of the phone can also be matched to the user's profile, or in response to an organisation's changing needs and priorities.

Cutting the cord

It all adds up to make IP telephony a very attractive proposition, both for organisations and their employees, so it's easy to see why so many organisations are choosing IP systems as they open new premises and as their existing systems fall due for renewal.

So far, however, most investment has been in fixed phone systems for use at desks, in meeting rooms and so on – locations often already served by data cabling. Despite the increasing use of wireless LANs to deliver data services more flexibly than is possible using fixed cabling, only limited use has been made of such networks to provide cordless phone services.

One reason is that, because they are more complex, Voice over Wireless LAN (VoWLAN) phones can use more power than conventional cordless phones. More significant, however, are the technical problems that make it harder to deliver a high-quality call over a wireless network. Wireless networks tend to suffer more from jitter than wired networks and have more limited bandwidth, for example. Together with other factors, this increases the chance that data transmissions will interfere with call traffic and that call quality will be poor.

Solutions to these problems are being worked on by the IEEE and other organisations but they are not yet widely available.

Losing your tether completely

Another limitation is that, today, users of wireless LANs can only move around within a limited area. Unlike mobile phone networks, where users are transferred seamlessly from cell to cell as they move, every time you move out of reach of one wireless LAN, you need to log in to another.

It's a problem technologists are keen to solve. The IEEE, for example, is enhancing its 802.11 series of standards to make it possible for users to roam from LAN to LAN.

Meanwhile, operators and manufacturers are working towards an even more flexible future – one in which people roam freely across technically different networks using whichever is best in each location. They could start their day at home, synchronising their diary or downloading a train timetable over a wireless LAN and broadband. Driving to the station, they could make voice calls over a 3G network before going online again using a public hotspot. Later, they could keep in touch using public 3G or WiMAX connections or their employer's corporate network, answering email and accessing files to prepare for meetings as they move from place to place.

This is all technically feasible today, but people have to use a range of devices and switching between networks is not smooth. If the vision of converged networks is to become a reality, devices and applications must be easy to use and the complexity of the operation has to be hidden from those using the service.

Alcatel, Ericsson and Motorola are seeking to establish open standards to enable interworking between vendor equipment. In parallel, the Fixed-Mobile Convergence Alliance, established by Swisscom, NTT, Korea Telecom, Rogers Wireless, Brasil Telecom and BT is working to define common technical standards so users can move networks on one device with no interruption in service.

An early result has been BT Fusion, the world's first combined fixed and mobile phone service which works like a mobile when out and about but which uses Bluetooth technology to switch to a broadband line – and thereby reduce call costs – when the user is at home.

Time to invest?

BT Fusion is, however, just a first step – one that others are starting to follow. NEC, for example, has launched a phone to roam from WiFi to NTT DoCoMo's FOMA 3G service in Japan, while Motorola has announced its CN620 voice over wireless LAN (VoWLAN) compatible phone for use in countries with GSM mobile networks. It is also working with Cisco to deliver a complete solution using IEEE 802.11 technology for use within business premises.

Elsewhere, Nokia has announced that it will use technology from Cisco to integrate its Series 60 devices with Cisco's IP telephony solution, CallManager. When users are within reach of their corporate network, they will be able to choose to connect over a wireless LAN to make their calls.

These developments confirm that fixed/mobile convergence is going to happen, and sooner rather than later. But like ‘simple' VoWLAN technology, significant problems remain to be solved before the technology can be regarded as fully mature. The wait won't be a long one but, for many organisations, it means it's too early to make a major investment.

So what should organisations do now? It may sound strange if your goal is to reduce mobile phone costs, but the best option right now is to invest in fixed IP telephony systems – in networks, routers and other equipment to replace private exchanges and the traditional phones on employees' desks.

By doing this, your organisation can take advantage of the cost savings and other benefits that IP telephony offers while also making sure its infrastructure is ready for what looks set to follow – a next generation of phone that can keep employees connected and get you the best deal.


John Blake is head of VoIP at BT Global Services, BT's business services and solutions division. He is responsible for the strategy and development of BT Global Services' Voice over IP (VoIP) portfolio in the UK and across Europe .



[1] Research for BT conducted by Coleman Parkes

[2] Forrester, Mobile User Support Costs, June 2004


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