Tuesday, October 19, 2010


If you are in Telco like I have been you probably hear from the same 5-6 vendors a week I hear from that claim to be the “largest provider of SIP trunks in the US”, meaning that I have never heard of them and their claims are greatly exaggerated. I give each one of them 5 minutes to explain why a small business like my own would want SIP. After the normal “it saves you money” and “it will work with any system out there”, I start asking the hard questions. To date, not a single vendor has provided the answers to these questions:

1. Can you give me a concrete ROI for SIP over my current PRI?

In today’s marketplace, a PRI will typically costs $300 or so. With that, you get 23-channels (or 30 if you are lucky enough to do E1) of crystal clear conversations, Caller ID, DID’s, fast call setup and guaranteed compatibility with whatever carrier I go with. Most offer rates of 2 cents LD and usually throw in bundled minutes. With SIP on the other hand, to get the same quality, you can only get about 18 channels on a 1.5 mbps T1, and you have to insure you have good data between you and the carrier, a phone system that accepts SIP trunks, and licensing for those trunks. I usually hear prices of about $12 per SIP trunk thrown around with about the same price for usage. Let’s look at this in real numbers of RMC or Recurring Monthly Charges:

PRI:   23 Channels:  $300

SIP:   1.5 mbps Data T1  $300 +

            18 Channels SIP: $216

Need I go into details? Even if the SIP carrier can give you 1.2 or 1.5 cents per minute, it will be VERY hard to make up the extra $216 per month. Until someone comes out with data service and the 18 trunks with no per-minute charges, there seems to be very little chance of convincing me that SIP is cheaper.

2. Can I connect to your SIP service with my current phone system?

It is amazing how feature rich and compatible my 1994 Nortel Norstar is! Most vendor reps automatically say “sure, we will just connect it up to your system and your users will never know the difference. Yes, you can bring in SIP to a gateway and give an analog or PRI handoff, but that means one more piece of equipment that someone has to pay for. Even if my phone system supports SIP trunks directly, I know that Nortel (now Avaya) would not just give them to me. How long does that $1200 license for 2 trunks fit into the ROI mentioned above? We can all hope what everything will turn around and all companies start upgrading to SIP-based phone systems, but sadly today, the majority of systems out there do not support SIP or can so only with great expense.

3. What will your trunks give me that my current PRI does not?

This is where SIP is supposed to shine: flexibility, reliability, advanced features, making coffee. As a single-site, small business owner, how does sharing of SIP trunks between sites or diversion of calls to another location help me? How reliable can SIP trunks be if it relies on my internet connection, which I know for a fact is anything but reliable? What features do I need other than getting calls, knowing whom they are from, and making calls without guessing if it will make it to the other end? Even features like at-home ACD features or cloud-based auto-attendant probably would only appeal to a small portion of SMB customers out there. If the features don’t match a need for the customer, then all the marketing in the world will not make it fit.

4. Can I fax over the SIP trunks?

This is the real problem with most SIP carriers – true faxing to and from any fax machine. The answer most vendors reply with is that they suggest the fax machines remain on analog lines. I don’t have that problem with PRI’s. Why can’t the vendors just come out and say that Fax over SIP is still in its infancy and needs work? Some will say that they support T.38 faxing, but from experience that only means that they support it, not that it will actually work with anything over about 2 pages. What is worse are the vendors that offer an electronic fax solution instead, which is fine for inbound, but does not work so well when I have to sign a document before faxing or need to markup a document before sending. I have customers all the time asking how to get by the need for scanning paper when going to electronic faxing. The dream of a paper-less office is not a reality yet, but with the advent of touchpads and document signing, we might be closer to it. User still need to be able to print a document, put other material with it, sign it, and fax the entire lot off to contact at the other end and trust that connection will hold up to 20 pages if need be.

Usually by my second question, most callers are back-pedaling and letting me know they will Email some more information, never to be heard from again, but there are those persistent ones that do their best to fit their marketing blubs into coherent answers. Only a couple have actually come close to making me a customer. I know that with Ethernet over copper and Fiber services becoming widespread, we will see the data charges go away and SIP trunk prices will come down below $10 per trunk. That is the point where technology and ROI will converge for SIP trunking. If you come across the golden solution before I do, be sure to share it with the world.


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5:49 AM  

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