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A Pivotal Year for SIP Services

Over the past few years, Session Initiation Protocol (SIP) has received positive endorsements from key industry and standards bodies as the preferred approach to deliver next-generation services. While capex spending remains under severe pressure, Heavy Reading research has shown that operators will continue to make strategic investments to maintain and expand their revenue base, and that SIP remains a key ingredient in the services equation. (See HR Reveals Leaders).

However, 2009 will provide a vital opportunity for SIP services to demonstrate that they are ready to reach full potential and whether or not traditional telco business models will discourage or encourage their adoption.

To this end, the emerging SIP trunking capability will be heavily scrutinized as a test case for measuring future success. SIP trunking is technically attractive, because it allows SIP-based IP PBXs to interface with carrier VoIP networks using IP "trunks" vs. relying on leased trunks based on interfaces such as primary rate interface (PRI). This approach is viewed as supporting better services interworking for IP services, as well as driving a significant reduction in opex costs, given it does not rely on leased facilities, can support both voice and data on a single connection, and eliminates inter-office toll charges between user groups.

SIP trunking has been deployed on a limited scale for several years, but without a firm definition of which services and standards must be supported, its adoption has been limited. However, the delivery of the latest revision of the SIPconnect specification later this year will address these shortcomings and provide a much-needed reference guide on which existing International Telecommunication Union, Standardization Sector (ITU-T) and Internet Engineering Task Force (IETF) requests for comment must be supported across the interface, as well as providing structure for feature interworking.

And yet, while these activities are essential and can only improve the likelihood of SIP trunking gaining a foothold, the entrenched business models and practices of network operators may hamper mass adoption. In this respect – since SIP trunking is designed, in the short term, to reduce the amount of traffic handed off to the carrier's public switched telephone network, and in the long-term, replace it entirely – it is not surprising that some telcos may be reticent to move ahead in order to protect revenue streams. If network operators do not ultimately embrace the technology or price it competitively, it will be difficult for enterprise customers to develop the business case to replace legacy PBXs with IP PBXs, which is crucial to drive the next wave of adoption.

Accordingly, Heavy Reading will continue to track the progress of SIP trunking and plans to conduct research later this year, capturing network operator deployment, services, and pricing strategies. Finally, in order to foster industry-wide dialog between enterprise and telco operators, on March 30 Light Reading will host Deploying SIP Services – the only North American event addressing carrier-based SIP services, collocated at the enterprise-focused VoiceCon – to discuss the issues and develop strategies to assist SIP services in fully realizing their promise.

— Jim Hodges, Senior Analyst, Heavy Reading

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