WHY MIGRATE TO IP TELEPHONY?

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1 WHY MIGRATE TO IP TELEPHONY? A By

2 Introduction Since its emergence in the mid-90s, IP Communications is finally coming into its own as a communications technology that can be trusted. Twentysix percent of all Global 2000 companies have already deployed IP Communications, and by 2006, more than two-thirds will have begun deployment. Even seasoned TDM administrators are beginning to admit that IP Telephony may be finally worth investigating before their aging PBX s reach end of life. Perhaps your organization is considering making the transition to a converged communications model, but isn t sure if it s worth the investment. This paper will help you examine some of the major justifications for why more companies are migrating to IP Communications, and why it doesn t have to be an all-or-nothing proposition. Reduced Costs These days, more companies are looking to achieve a healthy return on investment (ROI). It s no longer sufficient to shop for the lowest bid or ensure maximum scalability for technology purchases. Eighty-four percent of companies polled by Deloitte & Touche regarded cost reduction as a key driver toward implementing VoIP. What kind of cost savings does IP Telephony bring to its adopters? Companies have saved up to 40% on operating expenses by migrating to an IP Telephony platform, according to the Yankee Group. NEC Unified Solutions, which provides IP Telephony assessments, integration and management, has seen its IPC customers save 15-22% annually on network operating costs. Take for example, a fast-growing city which replaced its aging PBX s with an integrated IPC network, complete with centralized unified messaging and interactive voice response (IVR) trees for all its departments. The city estimates that it is saving over $250,000 annually in operating costs, which represents a 20 percent reduction in spending. The areas in which IP Communication implementations see the most cost efficiencies include: Network consolidation. Voice and data networks are replaced by a single merged network, lowering costs for equipment administration and administration. Telephony costs. Companies can reduce or even eliminate their leased tie lines and long-distance charges for campus-to-campus calls. Physical Moves, Adds, and Changes. MAC s are costly both in terms of IT resources and time. IPC brings the significant advantage of centralized administration that can make virtual MAC s a time-saving reality. Unified communication applications. These applications free employees from having to monitor multiple applications for messages, and increases availability to customers and others. NEC Unified Solutions, Inc of 5

3 Consolidated Infrastructure As technologies evolve, the responsibility of maintaining separate voice and data networks brings with it increasing challenges, and companies are beginning to look for ways to simplify and make their infrastructure more efficient. Network devices grow ever more complex, as does the support underlying them. Converged networks move companies toward a streamlined model for network architecture by allowing them to put all their devices, voice and data, on one network (see diagrams below). Administration is subsequently made easier, as configurations, upgrades and changes can now be done on a centralized basis without the need to physically visit campuses or machines. To be effective, this also means that data and voice administrators will need to work more closely and develop an understanding of each others technologies. Fig. 1 Traditional voice and data networks Fig. 2 Converged network NEC Unified Solutions, Inc of 5

4 Improved Productivity Probably the best reason for implementing IP Telephony is the benefit of increased productivity via integrated applications. Being able to access unified messaging -- , voice mail and faxes -- instantly without location dependence frees up employees to become more available to their customers and colleagues, as well as accomplish more tasks in a shorter amount of time. Telecommuters who utilize softphones can make calls from their office phone extension, even though they are away from the office. Customers also stand to benefit from the enhanced accessibility and service that such integrated applications afford. The socalled killer application might vary from company to company; for a hospital, it might be giving its doctors wireless notebooks or PDA s so that they do not have to make repeated trips back to their office. For a Fortune 500 company it might be allowing its management to hold IP video conferences with its top customers, thereby saving on travel and lodging costs. Whatever the application, IP Communications can provide an advantage to companies looking for a competitive edge. Revenue Generation By increasing employee productivity and freeing up dollars from IT administration and towards new projects, an IP Communication initiative enables a company to focus on more important objectives such as generating more revenue. The business impact can be significant; in the case of one national restaurant chain, NEC Unified Solutions implemented a new IP communications platform that included a callahead reservation system using IVR. The chain reported improved customer experience for its 600-plus properties, and take-out revenues increased by 18%. Such a formula for success, however, first requires building a business case and evaluating whether your network is ready for IP Communications. How to get started While IP Communications may be a new technology that results in a major simplification of your network, the migration path need not be dramatic. As a subsidiary of NEC America, one of the oldest manufacturers of communications systems, NEC Unified Solutions recognizes that, depending on the customer s specific business requirements, TDM elements of a hybrid system, may still provide value and reliability, and can be incorporated into an IPC framework. Hence, we advocate an evolution, not revolution, approach to migration. Hybrid IPsystems can be integrated into your existing TDM network, so that you can start taking advantage of IP Communication benefits like enhanced productivity. Gradually, as your older systems reach end of life, we can help you develop a finely tuned strategy to move towards a hybrid or pure-ip network. Such a road map would involve an objective assessment of whether your existing network is capable of supporting IP NEC Unified Solutions, Inc of 5

5 Communications, as well as how to ensure optimum performance for your IP applications and VoIP calls through targeted maintenance, monitoring and management services. NEC Unified Solutions can partner with you to make your technology solution start producing real returns. If you are interested in seeing how IP Telephony can work for you, contact an NEC Unified Solutions representative at About NEC Unified Solutions NEC Unified Solutions Inc., a leader in integrated communications solutions for the enterprise, delivers the industry s most innovative suite of products, applications and services that help customers achieve their business goals. With more than a century of communications and networking expertise, NEC Unified Solutions, Inc., a subsidiary of NEC America and affiliate of NEC Corporation (NASDAQ: NIPNY), offers the broadest range of communications services and solution choices, flexible product platforms and applications, and an open migration path to protect investments. NEC Unified Solutions, Inc. serves the Fortune 1000 and customers across the globe in vertical markets such as hospitality, education, government and healthcare. For more information, visit Document Information This document is intended to provide outline information only and can change without prior notice. References 1. Deloitte & Touch report, HTUhttp:// The Business Behind IP Telephony, Yankee Group report, Analysts question Avaya's IP killer app definition, Computer World, 5/4/02 HTUhttp:// 4. IP Telephony, paper by Lasse Huovinen and Shuanghong Niu, Helsinki University of Technology. HTUhttp:// 5. Redefining IP Communications, NEC Unified Solutions presentation, 10/7/04. NEC Unified Solutions, Inc of 5

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