The Jury’s out on SIP

It’s not that it’s not happening, but the rate at which SIP is being offered and adopted in New Zealand appears to be much slower than the rest of the world. Here I was thinking that us Kiwis lap up new innovation, but perhaps this is not the case when it comes to SIP, especially having heard a rumour that Australia is nearly two years ahead of us in this area.So what exactly is SIP? SIP stands for Session Initiated Protocol. The OCS Insider website explains that "SIP allows voice traffic to travel over data networks. It connects legacy phones and the Internet.” SIP is a signalling protocol that initiates multimedia usage within a network, such as video, voice or chat. It enables the end system to be used and handles all call transfers and terminations.When we talk about SIP, an important element to mention is SIP trunking – the service provided by an Internet Telephony Service Provider (ITSP) that uses SIP to connect a traditional Private Branch Exchange (PBX) to   the internet.In SIP trunking, VoIP is used to minimise communication costs and maximise network usage with Unified Communications (UC).Brian Jones, consultant for industry advisor TeleConsultants, plays down the concept of SIP, and states that it is just the third instalment in a line of telecommunications technologies that have changed the way we operate over time. "Most of us would have grown up with POTS, the plain old telephone service, and that was followed by the next generation which was ISPN,” he explains. "SIP is the newest and number three in line. It’s just another technology that allows voice calls over IP.”General Manager of Digital Island, Blair Stewart, views it much differently. Describing the technology as "a real game-changer”, he goes on to say that it is about time people sat up and took notice of SIP as "everyone has seemed to be in denial” over it for a while now. He likens adopting SIP to moving from a 35mm camera to digital. "You’re going from a relatively complex process to something that is quite cheap and flexible, and we are now at the tipping point.”Research firm Gartner points out that SIP has been around for a number of years already, however enterprises are only now starting to make the shift from a telephony-only system to a SIP-enabled network, with more of a focus on UC. This change in focus means SIP trunking is beginning to look more appealing.Currently, the way most enterprises use VoIP is limited to the enterprise’s own data network environment, which Gartner describes as a "VoIP island”. By implementing a SIP trunking service, it can extend the use of VoIP technology beyond a company’s own data network environment, providing IP-based connectivity to the public-switched telephone network, and enabling a more flexible bandwidth to be utilised. This, in turn, will support a unified communications strategy that is much broader and multimedia based."If you’re a person who gets excited by voice calling then SIP is the sexiest thing out,” says Scott Bartlett, CEO of Orcon, which has been offering SIP for a few years now. Having said that, he doesn’t believe anyone wakes up in the morning and thinks "I want a SIP trunk”. "They wake up and say: "I want to improve productivity and get more out of my unified communications”.”The appeal of SIP can’t be denied – with the constant need to cut costs and get more bang for your buck, this technology certainly seems to deliver. Bartlett states that as well as improving unified communications within an enterprise, the lower cost and "infinitely scalable” nature of SIP are added benefits.Show me the moneySo how much of a cost saving can SIP deliver? Gartner reports that in mid-size and large enterprises, SIP trunking can deliver savings on voice and data connectivity ranging from 30% to 50%. Cameron Beattie, Managing Director of Consultus, states that most VoIP services save you money in comparison to traditional methods. "When we do phone bill comparisons, the big savings are in the monthly line charges,” he explains."VoIP can save money on calling for both consumers and businesses.”As Bartlett mentioned, scalability and flexibility are another advantage to this system. A large distributed company, for example, with head offices in the main centres and smaller offices in the regions, can find it challenging to bring the smaller branches into the company loop without the enablement of SIP trunking.Jones expands on this by providing this example: "If you have a call centre in Auckland that takes calls for the entire country, the ease at which you can shuttle calls around an IP network through the use of SIP is substantial.”For a technology that appears to have so many benefits, adoption here in New Zealand has been slow. Or maybe it’s more a case of SIP not being promoted by the larger telcos. Beattie states that internationally, adoption of SIP has been massive, although for the most part, company connections have been mainly internal. "Their connections with the outside world are probably more traditional telephony at this stage, but that will change."SIP is pretty big, so in New Zealand we’re pretty behind the times,” says Beattie. He believes that the larger telco brands are not pushing VoIP. Taking a look at the market, there aren’t currently many options available from the large telcos for the corporate space.Beattie points out that SIP does come with new concerns for telecom managers and network administrators. "Traditionally, when it comes to data connections, people have concerned themselves with bandwidth. Not only are you adding more traffic on your network, packet loss and latency become important when they didn’t used to be.” It is important that a company’s network is up to scratch prior to taking on SIP.In addition to this, Jones highlights the importance of asking why we would do this; how would it help us? As with any new technology, with the benefits come new apprehensions. Adopting SIP can require the deployment of new gateways or managing a large number of new trunks. Given it is still at an adolescent stage, interoperability and training to manage SIP can also be a problem.In a time warpIf we look to the Australian market, New Zealand appears to be sitting where it was two years ago with SIP. Martin Trigg, Regional Director of Australian unified communications company Zultys, states that it was a similar situation and a slow process in the early years of SIP in Australia. "The service providers weren’t initially committed so they targeted the residential market first. Now networks are capable of delivering a reliable and functional service over broadband.”Offices in Australia are now starting to go purely with SIP trunks, eliminating the need for any traditional phone line, says Trigg.ShoreTel’s APAC Managing Director, Vasili Triant, presents an opposing argument. He believes that internationally, SIP still hasn’t reached mass adoption, and even in the United States of America it is still at the "bleeding edge” stage. "If you rewind five years then the U.S. was in the same boat as New Zealand, however on the whole, the roll out of SIP is slow everywhere.”Stewart sits in the same camp as Trigg, with the opinion that we have been very slow on the uptake, although this is beginning to change. He says that even in the last six months they have seen a massive move from businesses wanting to install SIP. "It’s been quite amazing. VoIP and SIP have definitely been around for a few years, particularly in the consumer space with Skype. Now, a lot of IT vendors are considering it to be best practice. It’s such a game changer in terms of cost for businesses.”Infrastructure criticalConnectivity, or lack of it, has played a large part in holding SIP back. "The question "what does SIP require to be successful in businesses?” needs to be asked. In the consumer space, poor quality is usually accepted because what they are getting is free most of the time. In the business space poor quality is not acceptable,” Stewart says. He emphasises that New Zealand has not had the availability of infrastructure for SIP to function successfully.Key to pushing out the SIP trunking network in New Zealand will be the roll out of the government’s Ultra-Fast Broadband initiative. The recent announcement by the Commerce Commission for a sub-loop extension service will add to this, encouraging increased competition, which Bartlett says is vital for the New Zealand landscape until UFB is rolled out."To get something like SIP out to the mass market, you need to see the likes of the big telcos get on board with it,” Bartlett emphasises. "The likelihood is they’re getting so much value from their existing assets that SIP isn’t top of their priorities.” Companies are now "hunting us out, we have businesses moving to us that have been Telecom customers for 40 years, just for the want of SIP”.It’s interesting to note that SIP within business environments is more mature than that within SIP carriers. Many enterprises have been using SIP technology but through traditional methods, meaning they have also been paying traditional prices. As the move to SIP trunking carriers begins to escalate, Bartlett emphasises the importance of finding a carrier that "does it properly”. Given the immaturity of this offering, it is fair to assume that there won’t be too much discrepancy between providers, particularly in the early stages of mass market adoption.On the same matter, Triant states that many smaller carriers offer SIP trunking over a broadband pipe, not highly rated in terms of capabilities. "You’ll find the bigger carriers, the larger telcos, may not be doing it yet but they’ll have a roadmap to it, probably involving providing it on their own pipes,” he explains."There is likely to be a lot of consideration going in to how they are going to package it.” Triant believes that using smaller providers raises quality and service issues, with customers being sucked in by the low-cost appeal.Does size matter?With the SIP market being what it is at present, one must ask if going with a smaller carrier is risking quality of service. Would it be better to wait for larger providers to get on board or are they just strategically waiting it out?Like many new technologies or services, the consensus is that the larger enterprises are moving toward SIP first, getting the ball rolling for small and medium-sized businesses to follow later. For companies who want to save money it will certainly provide them that, but the more compelling business case is based on the idea that it is ideal for those wanting to improve their workforce.A common quote from nearly everyone we spoke to was that "SIP is the future”, although the jury is still out on whether that so-called "future” will arrive in the next two, five, or 10 years. But with the roll out of UFB in sight, all we need now is for the big telcos to get on board and the New Zealand market could pull a swift one and catch up to the rest of the world.