VARs SIP cautiously as obstacles remain

Massey: once BT's 21CN comes in and is generally more available, SIP will take off

Vendors are promoting SIP-based communications technologies and research points to market growth, but the jury remains out on whether firms are really investing in it.

A report published earlier this year by Illume Consulting claimed the number of SIP trunking channels sold in the UK had reached 51,000, having been “virtually zero” as recently as 2007. This figure was projected to have doubled by the end of this year and increased tenfold by the end of 2011.

In total, half a million channels are predicted to have been deployed in the UK within two years. This will swell the market for channel rental to an annual worth of £60m.

One of the growth factors singled out by Illume was the adoption of the service by key carriers such as Gamma Telecom and Voiceflex. The UK SIP Trunking Report 2009 also claims that customer reluctance to invest in the technology has largely dissipated.

Illume added that the two main barriers to SIP adoption -­ PBX compatibility and affordable Quality of Service (QoS) ­- are still present, but that they no longer lessen end users’ willingness to invest.

Such market appetite has prompted the top carriers to develop their own SIP ambitions, claimed the analyst. Illume’s managing director Matthew Townend argued the vendor landscape would develop two factions.

“2009 will see significant market entries in the SIP trunking market and continued growth from the early entrants,” he said. “In the present economic climate we have seen the emergence of a two-tier market. It now looks like we are seeing the beginning of two distinct services, one with Quality and SLAs, the other more cost-effective but without guaranteed QoS.”

Across the Atlantic, appetite for SIP also appears to be growing in the enterprise space. Infonetics Research recently found almost two-fifths of North American firms with upwards of 100 employees have already deployed SIP trunking.

Slower adoption
But Matthias Machowinski, directing analyst for enterprise voice and data at Infonetics, claimed a reduction in technology refresh cycles could severely hamper SIP adoption.

“SIP trunking is catching up with TDM services and gaining broad traction with buyers,” he said. “However, it is unlikely we will see a rush towards SIP trunking, as SIP trunks are usually implemented during general technology upgrades, which are on hold at many firms right now.”

John Massey, managing director of VAR Actimax, compared the current market for SIP trunking to the voice over IP market three years ago.

“Once BT’s 21CN comes in and is generally more available SIP will take off,” he said. “It works as a technology, but it just has commercial barriers.”

Firewall vendor Ingate Systems specialises in SIP-based technology. The firm’s vice president of operations Janne Magnusson recently authored a white paper in which he outlined seven key benefits for businesses investing in the technology.

These included the optimisation of bandwidth usage by delivering voice and data in the same connection and increasing network redundancy.

“We see SIP trunks as paving the way to an all IP, all SIP world where businesses can work without geographical constraints, employees can contribute equally regardless of location, and everyone is reachable anywhere and anytime as long
as there is access to an internet connection,” he wrote.

One vendor to bet the house on SIP technology is Avaya, which rolled out its Aura architecture six months ago. At the time, European solutions marketing director Jirina Yates told CRN the technology was unlike anything the vendor has done before.

“SIP enables the next generation of communication,” she said. “It has been accepted by all the 3G networks.”

At Avaya’s recent EMEA partner conference in Prague the vendor reiterated its commitment to the technology. Vice president of sales Todd Abbott reassured partners that the acquisition of Nortel ­ and its high-end networking portfolio ­did not alter Avaya’s technological focus.

“Avaya Aura is the strategic direction,” he said.

Size matters
The vendor’s SME head honcho stressed the importance of ensuring the installation of the technology was not a complicated or daunting process for smaller companies.

Anthony Bartolo, general manager of Avaya’s Integrated Office Communications division, said: “Mid-size enterprises have the same needs as large firms but complexity can be the unwanted side effect in a deployment.”

He claimed mid-market businesses could deploy Aura in one hour, adding that Avaya has also launched a savings estimator tool to help fuel sales in this market.

Massey claimed some of his customers are investing in the technology but added that there are still a couple of key obstacles to SIP adoption.

“First is the cost of implementation,” he said. “Generally you need to install a bit of hardware on-site. The other problem is having a joined-up service level agreement from the data circuit provider and the SIP provider. These problems are stopping people installing it in large quantities."