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In the midst of a VoIP communications revolution
Internet telephony means more than cheap phone calls.
It's changing the way consumers and businesses stay connected, experts tell

Word Count: 1,350 Article#: GM-0503  Globe and Mail  (Sept. 15, 2005)


Andrew McAusland was in his hotel room in Florida when his portable computer rang.

The caller, an associate at Concordia University in Montreal, had no idea where Mr. McAusland was and had simply dialled his office extension. The university's voice over Internet protocol (VoIP) network took over from there.

"If I'm out of the office, and connected to the network, I'm available to take calls," says Mr. McAusland, Concordia's executive director of instructional and information technology services. "If I don't want to take calls, I disconnect. I can pick up voice mail by phone or using my laptop later."

VoIP buzz is building, with services such as Skype and GoogleTalk allowing consumers to make free computer-to-computer calls across the Internet and with telecom, cable providers and dedicated VoIP companies launching discount VoIP phone services.

"We are in the midst of a VoIP communications revolution," says Jeff Pulver, chairman of and publisher of Voice on the Net (von) magazine. "IP communications is disruptive communications in the most positive sense, and it will dramatically enhance the ways in which we communicate."

It's all based on a standard called Internet protocol, which transports data, voice and video packets over the Internet or private networks.

Before a large enterprise embraces VoIP, it needs a so-called robust IP network, which means the packets that are sent across the network will be reassembled in the correct order when they reach their destination.

Cost is the No. 1 obstacle to VoIP adoption, with the need to upgrade networks a close second, according to Gartner Inc., a Stamford, Conn., information technology research firm. However, the migration to VoIP is heating up and Gartner reports that IP-telephony products will represent 90 per cent of new telephone system sales by 2010.

Concordia has been running VoIP for almost two years. It upgraded its data network to IP technology because the former network was not robust enough to serve a rapidly expanding campus. The IP network from San Jose, Calif.-based Cisco Systems, Inc. allows over 36,000 students and 3,000 faculty and staff to use VoIP to place calls within the university. When they dial off campus numbers, the IP network connects seamlessly to the public switched telephone network.

Concordia has installed 4,100 IP phones and expects to reach 5,000 IP phones within two years, up from the 3,800 analogue phones and faxes the university had.

"A lot of work and expense goes into upgrading the network, but we can see the return in 20 months," Mr. McAusland says. "What we are saving on the cost of phone lines is paying for the project itself."

Each analogue phone had its own line, complete with a $150-per-month charge. Now, he says, the university has only "500 lines that feed out to analogue world." The university also no longer pays $250 to move a phone line: IP phones can be plugged in almost anywhere on campus without moving lines or changing extensions. Portable computers can be set up to access the network with soft phone software and a headset.

Companies with IP networks don't immediately install VoIP. In late January, BMO Financial Group signed a four-year, $84-million contract with Bell Canada to implement a large-scale IP-based network connecting over 1,100 BMO branches and offices across the country. Once data is running over IP, BMO will be positioned for a VoIP rollout but the company has not yet committed to VoIP, says Nimish Patel, vice-president, network services, BMO Financial Group. It's on the radar screen, but data is the first priority.

Migration to VoIP requires careful planning, says Isabelle Courville, president of Bell Enterprise, a segment of Bell Canada that provides voice, data and network management solutions for large businesses and government. "Data comes first. However, VoIP is mainstream. It's all about making the business case and managing the investment and change."

Mario Belanger, president of Avaya Canada Corp. in Markham, Ont., agrees. Data on the IP network comes first. VoIP requires a stronger business case.

"Companies can migrate [to VoIP] over time at pace that makes sense -- when it's time to upgrade the PBX [private branch exchange] system, for instance," he says.

If an enterprise has recently invested in or upgraded its PBX system -- a private telephone switching system that allows telephone extensions to connect to each other and the outside world -- it may defer its VoIP investment or look at a hybrid VoIP/analogue system.

But if a company with multiple locations across Canada is using different PBXs with different levels of service at each location and is paying for expensive connections between each PBX, it might have a case, he says.

If the PBX systems are digital, the company may be able to rollout a hybrid VoIP/PBX system.

Using a telecom company's carrier-grade IP network to connect the PBX systems, the company can centralize applications such as voice mail and still maintain its investment in analogue phones, he says.

"Over the next two to five years, most enterprises will put voice on IP," predicts Ken Hannan, vice-president of sales for AT&T Global Services Canada Co., a subsidiary of AT&T Corp. based in Thornhill, Ont. He expects to see staged rollouts as companies run pilot projects before moving VoIP across the enterprise. "The big bang approach is not always practical. You can migrate at your own pace."

Even though the cost of long distance has declined dramatically, long-distance savings are still driving VoIP, he adds. "It will drive ROI and adoption."

It worked for Gowling Lafleur Henderson LLP. With offices in Montreal, Ottawa, Toronto, Hamilton, Waterloo, Calgary, Regina, Vancouver and Moscow, and with over 2,000 partners, lawyers and support staff collaborating on cases, the company ran up substantial long-distance bills. In addition, long distance calls had to be tracked using a manually entered 20-digit case code. In short, long-distance calls, although vital, were expensive and administratively time consuming.

Bell Canada installed a VoIP system two years ago at Gowlings' Ottawa office. Now, the company has 2,400 IP phones on its network, so all calls between the Canadian offices are local calls, says Scott Jolliffe, national managing partner based in Toronto.

While it was a "challenge" porting the Ottawa office to VoIP, he admits, "by the third office, we had it down pat. We did the 750-person Toronto offices last and it went beautifully. It's fabulous. Our people love it. It speeds up voice communication so much."

Companies can also reap VoIP productivity benefits. Leaving one phone number and having the system follow you is a boon to mobile executives, Hannan says. From an administrative perspective, there are savings to be made when voice and data are converged on one network and when voice mail, call-centre services and other telecom services are standardized on an IP network.

At Gowling, staff can now have calls made to their office numbers ring on cell phones, laptops or on phones in other offices using the network's follow-me system. As well, a firm-wide voice-mail system on the IP network lets people forward messages to each other using the firm's five-digit extension system. Voice mail notices automatically show up on BlackBerry devices and messages can be picked up from any phone or accessed from a laptop or desktop computer connected to the IP network.

By the end of the year, Mr. Jolliffe expects the VoIP system to be tied to Microsoft Office Outlook contact lists so phone numbers of clients can be located by typing in a few letters of the client's last name and then dialled with the push of one button or by picking up the handset.

Although most large enterprises are only now investigating VoIP, providers are already planning for SoIP -- services over IP, including wireless VoIP, expanded voice conferencing and collaboration and video conferencing.

Once the IP network is in place, Mr. Hannan says, the only limitations are the availability of applications and bandwidth or the amount of information that can be transmitted over the network at one time.

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