In our last article we discussed all the reasons why a hosted voice platform could be a good idea for a small ILEC or CLEC – and we came up with a pretty good list of reasons to be interested in the concept.
It was all very positive and exciting, thinking about the wonderful future we might create together. However, at heart I’m a technical person, and we technical people tend to hold a bit of skepticism about all the claims made by the good folks in marketing. I think this CareerBuilder ad gives a little insight into this mindset…
In this article we’re going to even things out, by putting on our skeptical hat, and sharing some of the challenges with the idea of a hosted voice platform. Not all of these concerns will apply to everyone – it will depend on whether you want to fully replace your existing switch, or to supplement it, the interconnect options with your local tandem, and various other factors.
After this article on the concerns, we’ll pull this all together with one final article in our series (to be published soon) which will give you a framework for thinking about the issues given your particular situation.
NECA and TDM interconnect
The case for hosted voice platforms would be much cleaner if it weren’t for TDM trunking and NECA regulations. If you offer VoIP services and have VoIP interconnect to the PSTN then you can ignore this section, as the world is much simpler for you.
- Most ILECs and many older CLECs connect to tandems via SS7/ISUP over TDM. Many of you would like to use SIP instead, and many of you do use SIP for outbound long-distance calls, but in most of the country the only option for connectivity to your tandem is TDM. So even if you move to a hosted voice platform, you will still need a local media gateway to convert between TDM and VoIP.
- I don’t claim to be an expert on regulations or compensation, but it’s my understanding that under NECA regulations, you need to have a media gateway within your LATA, and (depending who you talk to) that media gateway may need to support ESA (emergency standalone) function, and you may even need to keep intraLATA calls within the LATA.
Taken together, these two issues basically mandate a local media gateway as part of a hosted voice solution. (We described the high-level architecture for this in the first article in this series.) You can’t remove you local hardware and local connectivity entirely, which reduces some of the benefits of moving to the cloud in the first place.
Feature Compatibility
One of the more compelling reasons for considering a hosted voice switch is that you would get access to a roadmap of new features, which might be particularly important for those selling a lot of business services. This is true, but if this is your driving force, then it’s very important that you perform a feature comparison of your existing platform and the new platform you’re evaluating. Does it handle both residential and business lines well? Does it have everything you need on the business side? The goal is to have access to new features (today and in the future), but you need to make sure you’re not losing any features that are important to your subscriber base.
Staffing
One of the biggest issues in the telecom industry is a shortage of skilled technical staff – and I know quite a few of our Award Consulting clients originally hired us because they no longer had a local expert available due to retirement or a job change. This is a real problem and maybe a hosted voice platform can help with that.
However, I’m skeptical that you’ll see huge cost savings in reduced staffing. You will still have subscribers, you will still have a media gateway – the same functions are still being performed, just in different places. Yes, maybe the new platform is easier to use than your DMS-100, and maybe you won’t have to perform annual software updates yourself any more, but I would want to carefully assess the magnitude of the savings.
Opportunity Cost / Effort
None of the above issues in insurmountable, and in the long-term I absolutely think we will end up with hosted voice switches being widely deployed among the rural LEC community. However we also need to recognize that the effort involved in making a change is significant. Our team has been involved in a lot of migration projects over the years, and they’re not easy. Setting up a new platform, learning how it works, and then seamlessly migrations service over to the new platform takes a significant amount of time. Even if this is absolutely the right choice, there may be other projects that take priority in the short term.
Conclusion
We’ve reviewed the pros and the cons, and the right choice is going to be a very individual decision. We will never tell you what to do, but in our next article I’ll try to pull this altogether to give a slightly more practical framework as you consider your options.
If you can’t wait another week to hear the conclusion, feel free to reach out and we can discuss the specifics of your situation and how we can help you out.
