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Are SIP Trunks Strategic?

There's a bit of a debate brewing on No Jitter about the role of SIP Trunks in the network of the future. The latest contribution comes from Marty Parker, who writes this week about his belief that SIP Trunks are strictly a least-cost routing play, with not much more strategic importance, especially when compared with the enterprise's need to deploy (and fund) Unified Communications. Marty cites two important factors that he thinks have been overlooked in the enthusiastic rush to SIP Trunking, at least as a concept if not in actual implementation:

1. Voice traffic over carrier trunks is on the decline. The number of voice minutes per user is being constantly reduced by the newer forms of Unified Communications....

2. SIP Trunks are a method of connecting voice traffic to the Public Switched Telephone network, not a platform for Unified Communications. UC systems send voice and other media (both peer-to-peer and conferencing) over the private enterprise LAN and WAN data networks and over the Internet. The UC systems may use SIP protocols, but only use SIP trunks for residual PSTN traffic to parties that are not on or federated with the UC systems.

2. SIP Trunks are a method of connecting voice traffic to the Public Switched Telephone network, not a platform for Unified Communications. UC systems send voice and other media (both peer-to-peer and conferencing) over the private enterprise LAN and WAN data networks and over the Internet. The UC systems may use SIP protocols, but only use SIP trunks for residual PSTN traffic to parties that are not on or federated with the UC systems.

Throughout the rest of the piece, Marty's downplaying of SIP Trunks' importance is tied to the fact that their purpose is to connect the enterprise to the PSTN, which as Marty notes in the two points above, is on the decline. However, I'd argue that this doesn’t make them unimportant, and it doesn’t mean they don't have a strategic role to play going forward.

For one thing, the PSTN is likely to be around for some time yet, and enterprises will need a conduit to it, especially for their contact centers. True, there are indications that contact methods are moving to online media, both email and the Web, as seen in the Avaya survey we reported on recently. But even if, as that survey suggests, the share of customers that want to use voice in their contact with you falls from 70% to 50%--that's still a huge chunk of your business.

Furthermore, the PSTN will always be needed so long as there’s not another common platform for ubiquitous connectivity. Many people would like to develop (and equip) that new common platform, but it’s getting to the "common" and "ubiquitous" part that’s going to be challenging. How did the legacy PSTN pull it off? Simple. Only one company was allowed to build and maintain it.

SIP Trunks are important today primarily because, yes, they promise cost savings—via least-cost routing, and also likely on rate arbitrage. I say: What's wrong with least-cost routing and rate arbitrage? If it saves you money, you probably need a reason not to do it. (Though, as I noted here, Marty is of the opinion that the cost savings are actually quite modest.)

Still, which technology is the way of the future: TDM (in the form of PRIs), or IP (in the form of SIP trunks)? Eventually, there should be no discrete "SIP trunks"--you should just have your IP trunks, connected to an Internet that's fully enabled for multimedia traffic handling and ubiquitous addressing. Right now, we're not there; we're in a transition stage, because of carrier business models, legacy customer base behavior, and enterprise migration paths as well.

In the early days of IP-PBXs, when the advantages of real-time IP communications were known but not even close to being realized, I heard someone say that, "IP-PBXs are a transitional technology. And they'll be a transitional technology for the next 15 years." I'd suggest the same is true of SIP Trunks, give or take your choice of longer-than-expected migration time.

For some more perspectives on SIP Trunking, be sure to check out the webcasts and sponsor information at our August 17 Enterprise Connect virtual event. Speakers will include Sorell Slaymaker of Unified IT Systems, our SIP trunking Implementation guru, as well as David Rohde of TechCaliber Consulting, an expert on procurements. We’ll also have presentations from Siemens Enterprise Communications, XO Communications, Acme Packet and Sonus Networks. To check out the schedule of webcasts and to sign up for free, go here.