Much of the buzz about VoIP to date has centered around residential services offered by companies like Vonage Holdings Corp. and, on the other end, IP Centrex services that companies such as SBC Communications are targeting at very large businesses. But there’s growing VoIP activity in the middle of all this as an increasing number of VoIP service providers begin focusing on small and medium businesses.
America’s small businesses saved more than $4 billion in 2003, and could save more than $6 billion this year thanks to expanded competition and innovations in telecommunications, according to a new analysis by the CompTel/ASCENT Alliance and the PACE Coalition.
Among the new competition on this front is Vonage, which recently expanded its marketing efforts to also target small and medium busineses (see Vonage Q&A, page 25). A company called Inflexion Communications — built on the acquisitions of three companies including EZPhone, Local Lines America and InTouch Communications — also recently launched VoIP services for the small and medium business market. Some of the cable companies, which are accelerating their VoIP initiatives, are also starting to target the SMB market. And established integrated communications provider Broadview Networks expects to launch field trials of a hosted key system VoIP offer for small business this quarter in the New York metropolitan area, with the idea that it will do a full rollout of the service later in the year.
“When you look at the VoIP world, there are two large players,” says Vern Kennedy, Broadview’s president and CEO. “One is consumer-focused, buy-cheap low-quality voice over the Internet players. And there are the players who’ve announced large IP PBX to multinational, very large business plays. What we haven’t seen at all are true VoIP offerings to small business customers. So we think we are, at least, the front runner right now” in the SMB VoIP space.
Broadview is targeting about 20 customers with 250 to 300 stations for the field trial, says Ken Shulman, wholesale sales executive vice president and CTO at the company, which operates in 13 markets in the Northeast. These activities follow the company’s 10-customer technical trial of the Broadview Office Suite, in 2003.
The IP-based hosted key system service, for which all key system features are offered from the Broadview network, includes a Web portal through which customers can do office administration and individual station administration, such as programming buttons on a given station set. “With us, you can do that with point and click on your computer,” says Shulman. “From an end-user perspective, now you’re getting all those features and functions — multiple line appearances, multipoint station appearances, [the ability to] add users, move stations, etc., in a very user-friendly way.” Traditionally, a support company has to do these jobs for businesses at a fee, he says.
“I have two phones on my desk,” says Kennedy of Broadview. “We get bad weather here. The convenience of being able to go on a Web site at 7 in the morning and route one line to a home phone and another line elsewhere and change it the next day is important. While that was available in the past, it was a lot more difficult, time consuming and expensive to do.” With VoIP services like the one Broadview offers, he says, non-technical individuals can easily manage those kinds of changes and without high costs.
“I personally believe it’s going to fly off the shelves,” says Shulman of the new service.
And since Broadview already has a network in place, it has the infrastructure to deliver E911, quality of service as good as TDMbased voice and broadband connectivity, adds Shulman, who says the company has not yet made equipment selection announcements related to its VoIP initiative.
Of course, these aren’t the very first instances of VoIP providers targeting SMB, just an indicator that this space is growing.
Mark Monday, director of marketing for Cisco Systems Inc.’s multiservice customer edge business unit, says many service providers are using its CallManager Express product to provide VoIP services to the small and medium business market. Announced in October, Call Manager Express is software that runs on Cisco routers to provide key system functionality to IP phones. FastWeb of Italy is using the software to provide a managed service, while others — such as BellSouth — are reselling the Cisco tool bundled with their own professional services, Monday says. “So many service providers already use our routers for managed service, so this is an easy way to add more ARPU,” he says, while leveraging their existing investment.
In another application of IP-based voice, Atlanta-based Cbeyond Communications for four years has catered to small and medium businesses with integrated access services that enable companies to combine IP-based voice and data over single T1 connections.
The fact that voice goes over the T1 in IP format means that bandwidth on the dedicated line is available to data traffic when voice isn’t running over the T1 connection; whereas in a traditional integrated access scenario involving TDM-based voice, channels on the T1 must be carved out specifically for that voice traffic. But in the Cbeyond example the voice doesn’t go over the Internet, it’s then converted back into TDM to be carried over the PSTN.
