IP Capsule E-newsletter, December 21, 2006

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December 21 , 2006

Brian SantoIPso Facto...

An enterprise VoIP tipping point
When Cisco Systems CEO John Chambers decreed his company would make the transition to VoIP a couple of years ago, it was an astute bit of public relations - literally putting his money where his mouth is. But it was more than just a stunt. It was a demonstration that VoIP was technologically suitable for a large, modern enterprise.

Technologically, yes, but not necessarily financially.

AT&T recently released a white paper that says enterprise VoIP is now at a tipping point where it's financially justifiable for the average enterprise. Based on internal experience, AT&T said VoIP now provides convincing total cost of ownership (TCO) savings and return on investment (ROI) across the entire company. AT&T said it is now fast-tracking the implementation of VoIP within its own business.

AT&T said internal testing showed that VoIP provided a return on investment quicker with new facilities and in non-U.S. facilities. In the former case that was because VoIP is now less expensive than traditional voice equipment provided there is no legacy gear to deal with; in the latter case because of high rates charged by in-country service providers.

In the U.S., AT&T said, the decision on when to migrate to VoIP depends largely on the vintage of installed PBX gear. VoIP can't be justified with newer PBX equipment, or PBX gear that's new enough that an upgrade is more economical. When an older system has to be replaced, however, "VoIP economics rule," AT&T said. And as the price of VoIP phones continues to fall, those economics are only becoming more attractive.

AT&T VoIP cost savings calculations

New Sites
Existing Non-U.S. Sites
Existing U.S. Sites
Same as
existing sites
20% to 50%
cost reduction
25% lower to deploy
Varies by situation
35% to 50% higher
for equipment; 30%
savings in ports
Yearly Operating Expense Savings
$500 to $890 per user
$690 to $1,070
per user
$500 to $890 per user
Net payback
1 year
1 to 1½ years
1½ to 3 years
Source: AT&T

AT&T said it is experiencing productivity gains in both system administration and management, and with end users, for several reasons:

  • Single reach numbers for mobile workers allows calls to be received regardless of where they are
  • Single voice message system eliminates need to forward calls to outside lines
  • VIP calls reach users immediately, even when out of the office

There are downstream savings as well. VoIP is supporting AT&T's drive to cut costs through remote office or "telework" arrangements. AT&T estimates it is saving $180 million yearly through telework, including $34 million yearly in reduced real estate costs. Some 30 % of AT&T managers now work full-time in a virtual office.

A case study of a large company, with all the numbers filled in, attesting to the both the technological and fiscal viability of enterprise VoIP is a powerful argument that VoIP truly has arrived, and should add impetus not only to demand for VoIP in the enterprise market, but also to efforts among service providers to cater to enterprise customers.

Editor's note: IP Capsule will not be published on Wed., Dec. 27, but will return on the week of Jan. 1, 2007. The staff of CED wishes you wonderful holiday and a Happy New Year!

Linksys introduces iPhones for Skype users
Cisco Systems' Linksys division introduced two new VoIP phones to be used in conjunction with Skype's VoIP service. At the same time, Linksys announced its VoIP handset products - some of which have been on the market since the summer of 2004, will now all carry a family name: iPhone.

Linksys CIT400
Linksys CIT400 Dual Mode
Telephony Kit for Skype

The speculation is that Apple Computer is readying VoIP products for introduction at the MacWorld Conference in January, and naturally that yet-to-be-announced product was expected to be called the iPhone. It's got to be a source of some disappointment to the folks at Apple that Cisco owns that trademark - and a source of aggravation that Cisco decided to start using it so close preceding MacWorld. Or maybe it's just a coincidence.

…And no doubt annoying to both is that, at least for the moment, typing into a Web browser redirects you to The Internet Phone Company.

Linksys' new iPhone Dual-Mode Internet Telephony Kit for Skype (CIT400) embeds the Skype communications client into a cordless phone base station that is attached directly to the home network via Ethernet, making it easy to place calls to other Skype users, mobile phones, or landlines without turning on a computer. Linksys expects this item to retail for $179.99.

The new iPhone Wireless-G Phone for Skype (WIP320) makes Skype portable by integrating it into a wireless-G handset, allowing consumers to place calls from anywhere they can connect to a wireless access point. Linksys expects a retail price of $199.99.

Linksys says it has shipped more than 3 million VoIP products worldwide. The five models already being sold include wireless G models, and dual-mode models. One of the latter is marketed with Yahoo! Messenger.

For New Product Information, visit CED's Product Showcase Today!

Click Here.

Nortel in $2B broadband deal with Verizon
Verizon Wireless plans to do an additional $2 billion of business over the next five years with Nortel Networks. Verizon plans to deploy additional CDMA2000 radio base stations, switching and optical network technology, along with related equipment and services. Verizon Wireless earlier tapped Nortel as the supplier of EV-DO Rev A equipment. Verizon said Nortel will help it migrate toward an IMS infrastructure.

BellSouth cuts monthly fee on top DSL tier
BellSouth lowered the price of its premium DSL Internet service by $4 per month. FastAccess DSL Xtreme 6.0 is now available to new customers for $42.95 a month, the company said. FastAccess HomeNetworking Plus, for which BellSouth previously charged $5.00 a month, and Premium Internet Security services for one PC, previously $6.99 a month, will henceforth be free with the Extreme DSL tier.

Panasonic's Toughbook W5
Panasonic's Toughbook W5

Panasonics builds EV-DO into its notebooks
PC makers continue to build into their products automatic access to various cellular networks. The latest is Panasonic Computer Solutions, which said its Toughbook W5 and T5 notebooks will now feature built-in support for Sprint Mobile Broadband services, including its upgraded EV-DO Revision A service, which Sprint is in the process of rolling out. Users will have the option to access Sprint Mobile Broadband service running on the Sprint Power Vision Network in more than 220 communities and 725 airports across the U.S.

At the same time, Panasonic Computer Solutions became a Broadband Partner with Verizon Wireless. Panasonic can directly sell and activate Verizon Wireless BroadbandAccess service for its Toughbook channel partners.

AboveNet expands core network with Juniper routers
AboveNet has begun upgrading the capacity of its nationwide Tier 1 IP network backbone with Juniper Networks' T-series core routers. AboveNet's private optical network delivers network and IP services in and between 14 top U.S. metro markets and London. The Juniper Networks T-series will both enhance the capacity of AboveNet's network and its existing Layer 2 eWAN service, and enable it to introduce new services such as Layer 3 MPLS-based VPN Services.

SureWest hits gas with 'Ultimate' tier
SureWest Communications has introduced a new fiber-fed Internet tier that offers symmetrical speeds up to 50 Mbps.

Other tiers in the company's new "Ultimate Package" include 20/20 Mbps and 10/10 Mbps. SureWest employs an active Ethernet Fiber to The Premises (FTTP) network that serves about 20,000 customers and passes nearly 100,000 homes in the Sacramento/Roseville, Calif., corridor. Its telephony division operates copper lines and more traditional DSL services. The 50-meg service runs $259.95 per month.

SureWest's "quadruple play" Ultimate package, which includes the 50-meg Internet tier, digital television, and wireless and wireline phone services, runs $415.18 per month.

IP Unity picks up messaging firm
IP Unity and Glenayre Messaging, a division of Glenayre Technologies announced that "the parties have entered into a definitive asset purchase agreement for the consolidation of the two entities." In English: IP Unity is buying Glenayre Messaging.

The price is $25 million, and IP Unity will adopt the name IP Unity Glenayre. The combined entity will offer Glenayre's messaging applications bundled on IP Unity's carrier-grade media servers and application servers.

IP Unity has sold largely to MSOs, but also to wireline and fixed-mobile convergence customers; Glenayre has its roots in the wireless networking business. The two said they haven't a single customer in common.

Together they'll be able to pitch the convergence angle to a built-in global customer base of over 2,000 deployments for 300 wireline telco, cable, wireless and FMC service providers, large enterprises and public agencies.

Couch Kitty

Average viewer
soaks in over four hours of TV a day

The average American spends well over four hours watching television every day, according to statistics compiled and recently released by the U.S. Census Bureau.

You can find the data, including breakdowns of what type of TV is being viewed, in PDF format. For example, a little more than half of the average time spent viewing is spent watching cable or satellite TV.

An informal poll of people involved in the cable industry, including extremely small samples of equipment vendors, journalists, programmers, marketers and PR professionals (conducted by me) reveals that few people in the industry watch much TV. In other words, there must be a whole bunch of couch potatoes out there who are watching way more than average to compensate for those of us who barely watch at all. Think about that.

Dish Network preparing IPTV offering?
This is interesting…

This Month's Issue
December 2006
Issue Contents »



Company: Minerva Networks
Headquarters: Santa Clara, CA
CEO: Mauro Bonomi

Claim to Fame: Provides products to enable IPTV services, including iTV Manager software (both client software and a management platform), and video processing hardware, including encoders and decoders. Is a member of a loose-knit confederation of IPTV system vendors, including Irdeto, Kasenna, Latens, Tut Systems, Widevine, Envivio, Amino, and others whose products are inter-operable.

Recent News of Note: The company is working with IBM to develop IPTV system applications; had its middleware adopted by Smart City (the telecom provider for Walt Disney World) along with equipment from Tut Systems and Latens.


Consumer Electronics Show
Las Vegas, Nev.
Jan. 8-11, 2006
More information: Click Here

Understanding Mobile and Cellular Networks
Dallas, Texas
Jan. 23-24, 2007
More information: Click Here

China Broadband Triple Play/IPTV Forum 2007
April 18-19, 2007
Hong Kong
More information: Click Here

China DSL Forum 2007
April 18-19, 2007
Hong Kong
More information: Click Here

China VoIP
Conference & Expo 2007

May 23-24, 2007
Hong Kong
More information: Click Here

June 18-21, 2007
Chicago, Ill.
More information: Click Here

Wireless & Mobile
Expo & Conference

July 17-18, 2007
Toronto, Canada
More information: Click Here


Copyright © 2006 Advantage Business Media. All rights reserved.



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