Adopters highlight complex decisions behind VoIP

Network architects guiding their companies through VoIP implementations say now may not be the right time to "rip-and-replace," and explain why cost savings isn't the key factor.

ORLANDO, Fla. -- Vendors may laud cost savings as the key VoIP benefit, but VoiceCon 2005 speakers explained that other boons like unified messaging and improved reliability must be the true drivers for successful Internet telephony projects.

During a session at last week's conference, network chiefs from large U.S. companies said even though most enterprises are in some stage of evaluating VoIP that doesn't mean now is the right time for all.

Jeff Denecke, corporate vice president and chief architect for New York Life Insurance Co., said his company spent five years waiting for the right opportunity to implement VoIP before finally deciding to move forward two years ago.

"The truth was that there was no ROI for us," Denecke said. "It would have been a rip-and-replace [of existing systems, saving little or no money]." Construction of a brand new major campus location and data center finally made the project financially viable.

Still, since preventing a major phone system failure was a top objective, Denecke said New York Life spent the money to provision backbone call servers at each of its locations, plus backups at its data centers.

"As a result of September 11, many of the companies in Manhattan had to look at what was needed for business continuity," said Denecke, so businesses could keep operating in the event of a disaster.

Denecke said Cisco Systems Inc. was the right choice in order to standardize its voice and data gear on a single platform and bring the first VoIP phones online quickly. "In the course of four months," he said, "we went from not having an IP telephone system to getting one in place and putting the first employees on it."

With the implementation now well under way, Denecke said it will save his company $800,000 in its first three years because of easier user maintenance, reduced cabling and unified network management. However, he predicted that the biggest benefits will come this summer when the company completes its unified communications strategy by installing Cisco's Unity communications convergence software and updating its IBM Lotus Notes clients.

Michael Obiedzinski, vice president for Depository Trust & Clearing Corp., told attendees that uptime and reliability were his top objectives in moving to VoIP. Since DTCC and its 2,500 employees process more than 20 million securities transactions daily, he said an interruption in its voice service could affect financial markets worldwide.

Its other key goal was providing more flexible access to voice systems, since the company's management team must be distributed across several offices at all times. Obiedzinski said VoIP enabled him to put a unified communications system in place so an executive could use any phone in any office to receive calls and access voice mail.

Since DTCC had been a Nortel Networks Ltd. customer for 20 years, it decided the best way to maintain platform stability was to IP-enable the legacy PBX units in its seven locations. Even though Cisco gear powers its wide area network, Obiedzinski said everything ran smoothly from Day One.

For more information

Learn how Bank of America handled voice and data duties in its VoIP rollout.

Check out our Topic on hybrid PBXs.

"During September 11, all our [New York City] sites were up, but staff couldn't get to them," Obiedzinski said. "Now we don't have to be near the PBXs. They could be at a remote site, and we can manage them from another remote site."

In the coming months DTCC plans to offer more VoIP features to mobile users by adding Nortel's voice client to BlackBerry handhelds, and add softphone support via gateways from Citrix Systems Inc. Obiedzinski said as a bonus, the cost of user moves, adds and changes is already down 60%.

Attendee Patricia Elwood, telecommunications manager for New York-based law firm Willkie Farr & Gallagher, said her company is planning a VoIP pilot in its New York and Washington, D.C., locations. She was encouraged to hear that DTCC is having success with Nortel, which is also her company's platform.

"Typically, all you hear is people talking about their Cisco implementations and how great they are," Elwood said. Some of the data networking experts at her firm want to abandon Nortel in favor of CallManager, even though its legacy Nortel PBX is only six years old.

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