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VOIP in the Enterprise: Can CIOs Take It to the Bank?

By Darrell Dunn  |  Posted 2007-08-27 Print this article Print

Companies are increasingly turning to IP-based systems to replace traditional circuit-switched networks. But how ready are the companies--and the technology--for the next wave of business communications?

Technology can weave into the enterprise tapestry by way of choice or by necessity, as businesses face the prospect of either joining the next generation or clinging to outdated tools. CIOs and other I.T. decision-makers are faced with that quandary now as they attempt to create a long-term communications strategy built around Internet Protocol (IP)-based telephony.

IP telephony is the routing of voice over the Internet or an IP-based network. IP-based communications networks are being used to replace or augment traditional time-division multiplexing (TDM)-based circuit-switched networks.

The move to IP-based networks is already well underway. A third of all telephony extension line shipments this year are expected to be IP-based, while two-thirds of the shipments will be based on TDM technology, according to research firm Gartner. By 2011, that ratio will reverse, with IP-based lines accounting for two-thirds of all shipments.

Most large enterprises have already begun limited use of voice-over-Internet Protocol (VoIP) and other IP-based telephony tools, Gartner says. As the growth curve of IP-based installations indicates, the future for telephony is IP. Even the most conservative CIO understands that future telecom investment will be IP-based, while the workhorse TDM-based networks of the past will be gradually weeded out over the next decade. Unified communications has been a topic of roundtable discussions, but has been found mostly in back-room R&D efforts within enterprises and at technology vendors for much of the past decade. Growth in IP-based systems during the past few years, however, is serving as the launching pad for the uniting of existing communications and data networks, including desktop telephone systems, voice mail, Internet, presence and contact information, and the integration of business applications.

Nonetheless, business leaders are leery of IP telephony. A number of vendors have struggled financially, including 3Com, Nortel, SunRocket and Vonage. Within enterprise deployments, IP telephony remains relatively nascent with a significant amount of ongoing experimentation to determine the best practices for deploying a unified communications strategy. This often requires the technological assets of multiple vendors, and has led to partnerships such as Nortel-Microsoft and 3Com-IBM.

Next page: The Widening Reach of VoIP

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