Viop phone - Voice Over IP

Without trying to throw a damper on the voice SDN/VPN, there are some conditions that may cause the end users to balk at its use. Many organizations’ telecommunications management typically try to match the needs of the organization without causing undue stress on the user. However, the special dialing procedures necessary to use a SDN/VPN often got in the way. Let’s use an example of a group with road warriors. The traveling person needs to use long distance to customers, contacts, and back to headquarters. Therefore, a special calling card is issued that has the caller go to a pay phone. From there the caller dials a special 800 number to call into the SDN/VPN (this requires 11 digits). This is nothing more than a switch that is keeping track of the traffic and usage verification. Once into the SDN/VPN, the caller then dials the 11−digit telephone number for a North American location. The number of dialed digits may be higher for international calls. Finally, the caller must dial their user calling card number to validate it for authentication and billing purposes. This may be an additional 15 digits. So all told, the customer has just dialed 37 digits to make a call. This creates frustration for the caller, especially if they make several calls during the course of a day.
Let’s complicate the above scenario a bit! After being frustrated by dialing all those digits, the caller gets a busy tone. This means that they have to start over. Now the frustration really starts to mount. Moreover, one may be reading this and saying “what is the author talking about? I can dial a number and if I get a busy tone, then I merely dial the pound key (#) and get my dial tone back.”
That may be true for some calls and some phones, but this is not a guarantee. The individual phones at airports, hotels, and along the roadside may not allow this. Many may be phones that are used by a specific vendor/carrier (we have all seen the WorldCom and AT&T phone in the lobbies of hotels that only allow the features on their own specific network). So if the caller is using a WorldCom phone and calling an AT&T network, all bets are off. The service may require that the caller hangs up and starts over. Moreover, when making a string of calls on a normal calling card, customers are able to use the # key to place the next call without entering the calling card number every time. This again is not necessarily true with the special SDN/VPN cards. Although the carriers have taken great strides in eliminating these problems, they still cannot guarantee that everything works at every phone. By the way, with the SDN/VPN, the carriers allowed stored numbers in the central switch so that a user could eliminate some of the dialing process by using a speed dialing arrangement. Corporate telecommunications personnel may have predefined calls to each office with a three− to five−digit
speed number, thus the caller could eliminate some of the digits required. This is a noble gesture, but it does not always work the way it was planned, and therefore the end users begin to rebel against the amount of time they spend dialing digits to do their job. Now back to the original purpose of the VPN—to save money and ease the process of communicating between and among users within an organization—the ease of use is not assured, as stated previously, so the goals are not met entirely. From there, however, the user can usurp the savings by doing many things:

• Reducing the amount of calls they make by refusing to dial the digits
• Calling around the VPN by using a separate calling card that is not billed under the special arrangement
• Placing operator assisted calls instead of dialing, thereby incurring a much higher cost per minut

Each of these situations complicates the overall purpose of using the VPN/SDN. One final comment here is that the users also begin to bemoan the use of the network to their superiors, who then begin a grass roots effort to override the VPN. What was planned as a cost containment tool, becomes a more expensive solution overall, and management really does not want to hear all the complaints about a system as mundane as the telephone. Bear this in mind as you look into the use of these systems. This discussion so far has only considered the case where the corporation owns the PBX and connects it to the VPN. What if a Centrex system is provided by the incumbent local exchange carrier (ILEC) or leased from a reseller? The answer is that one can still implement all the above
with a Centrex system at any or all locations. Because Centrex is essentially a PBX that is physically resident at the local central office, it too can have TIE, FX, or RCF trunks. The long distance carrier supplying the VPN will be more than happy to terminate VPN trunks on a Centrex system.

In summary, the important points are as follows:

• Calls are carried over the PSTN.
• A custom dialing plan is used.
• Pricing is dependent on the locale.
• The number of locations.
• The projected or committed traffic volumes.

This is all achieved by computer databases in the network.

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To get corporate America back on the switched network, AT&T devised a marketing strategy. The approach went something like this to the CEO/CFO: “Look, your primary business is banking [building airplanes, trading stocks, selling insurance or whatever], but it is not running a telephone company. Who knows better how to run a telephone system than we do? (You can substitute your favorite carrier here. AT&T is chosen here because they were the first to introduce this service.) You think you are saving money by using these dedicated lines. On the surface, it appears that you are. However, who is managing this network? What is it costing you to recover from outages? Do you have back−up facilities for each of your dedicated routes? Your dedicated team of telephony experts is costing you a bundle. Why are you doing this?”

The CFO and CEO look at each other and shrug their shoulders. “Our CIO or CTO [2] CTO is the Chief Telecommunications Officer or Chief Technology Officer depending on the organization sold us on the idea for providing better service at a lower cost,” they said in unison.
“Look,” said AT&T. “We have the ultimate (outsourcing) deal that will provide all your current capabilities for one low price. We will manage the whole network for you and give you all the service you currently enjoy with your private network with little or no hassle.” Our product is called (somewhat obscurely) Software Defined NetworkTM because you can define the parameters of the
network yourself,” AT&T said proudly. Sprint and MCI/WorldCom [3] MCI and WorldCom were different entities at the time of this offering, but for this book are updated to reflect current situations. TMSoftware Defined Network is a Trademark of AT&T. offer essentially the same product and call it a virtual private network (VPN). We use VPN here because it is both the generally used term, and it is descriptive of the offering. Here is how the deal works: The company defines the locations that will be part of the VPN as shown in Figure 3−2. The larger the average traffic commitment made between these locations, the lower the price per minute can be. (The catch is that if traffic falls below the average commitment, cost falls into the next higher rate category.) carrier will do it. Organizations can now lay off the telecommunications department. (Please note that the staff supporting the PBX in each location is still needed to handle moves, adds, and changes. In addition, the staff needed to maintain the dedicated data network is still needed. Even if the organization migrates to a Frame Relay network, some management of the vendor is always required). All the calls to specifically defined locations (offices) in Chicago, Atlanta, Phoenix, and Seattle are known as on−net calls. These are priced at the reduced rate. Calls to business partners and customers are off−net calls and are charged at a higher rate. If the off−net call volume to these specific locations rises, the organization can still place FX lines into these areas. Again, there is no substitute for knowing the traffic distribution when evaluating any telecommunications plan. As one can determine from the above description, it takes a sharp pencil to figure out if this is a good deal. It is definitely a good deal for the carrier who gets all those calls and minutes back on the switched network. The VPN is more reliable than a dedicated, line−based network because calls are really riding over the Public Switched Telephone Network (PSTN), which is rich in multiple paths. One of the features of the private, line−based network was four− or five−digit dialing. This can be preserved intact if we want. Because the switches in the telephone network are computers that have access to a database, they can easily look up how to route a number based on the originating location and number dialed. The VPN then is a special discount−billing plan, with the carrier managing the network on which we can have a custom−dialing plan.
A caveat that should also be brought into the equation is that the large corporations will negotiate long−term SDN/VPN agreements with the carrier. Typically, the agreements will bear a 3 to 5 year term whereby the customer enjoys the benefits of the fixed pricing arrangement, with some caveats on usage such as minimums, numbers of locations, average revenue generated per month, and so
on. If, however, the average volume falls below an agreed−to level, the carrier may charge a penalty. This penalty may be in the form of

• A minimum charge per site
• A minimum charge per month
• An averaged cost that is used on a quarterly basis (that is, they will bill the higher rate for an entire quarter if the customer does not achieve the minimum billing)

Any one of these charges may apply to the consumer’s billing, depending on the agreement between the players. Incidentally, the customer and the carrier are usually sworn to secrecy regarding the rates and terms of the agreement, through some nondisclosure arrangement. The purpose of this nondisclosure is to keep the mass public coming back and asking for the same deal! Or is it? Sometimes the deal is not as good as it is supposed to be. One such case was a large financial company who had a deal with the carrier for 5 years, yet over that same period of time the costs were rapidly plummeting. The customer was actually spending more per minute for their SDN/VPN than if they just picked up the phone and made a long dis−tance call. Newer contracts will usually bear some terms that state if the costs decrease over the term of the agreement, then the carrier will annually review and adjust the rates accordingly. It may also state
that the adjustments will be enacted if the costs drop by some fixed percentage point (like 10 percent). In either case, the carrier will also hook a contingency that because they are tied to reducing the costs in the contract period should the prices fall, they also reserve the right to raise the rates if their prices increase at greater than some tied percentage point (usually 10 percent). So what we have is an agreement that is somewhat fluid and can be modified during the term of the contract so long as both parties are in agreement. Where this is a benefit is when a company plans extraordinary growth over the term of the agreement, or when there is some speculation that some
sites may be closed and contraction will drop the overall volumes.

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Using these dedicated lines between locations, organizations created a private network. The next step in the evolution of private networks was to devise a corporate−wide numbering plan and have the now intelligent PBX determine the route to the dialed destination via its peers, just like the local telephone office does. After all, other than size, there is little difference between a PBX and a telephone company central office switch!

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As corporate communication volumes increased, organizations realized the cost of telephone service was escalating. Originally, all long distance service was charged on a per minute basis. AT&T introduced a volume discount outbound calling plan called Wide Area Telephone Service (WATS) [1] Some people refer to the term as Wide Area Telecommunications Services. For a monthly fixed payment, the organization got 240 hours of service to one of five bands across the country. Each band was priced, based on the distance from the originator’s location. A typical company usually had a band 5 line and a band 1 or 2 to cover adjacent state calls. It took some analysis to determine the most cost−effective solution for each company’s particular calling pattern. Foreign exchange (FX) service provided a fixed rate calling plan if a company had a large call volume for in−state locations. This is essentially subscribing to telephone service at the foreign central office location and leasing an extension cord from the telephone company to the home location. Originally, there were no usage charges on this line so the more you used it, the less expensive it was. Of course, long distance calls made from the foreign exchange were billed at the long−distance rate. An FX line is needed to each high volume calling location. Alternatively, a company could use a leased telephone line between locations. These lines went by several names: Terminal Interface Equipment (TIE) line, dedicated line, and a data line, when used for data. These are essentially point−to−point telephone lines that are available in two−wire or four−wire configurations. Because the difference in cost between two− and four−wire connections was small (relative to the cost of the line), the four−wire option was preferred unless the company needed many lines. The next logical step was to use these TIE lines to connect private branch exchanges (PBXs) at the various locations. Here again, there were no usage charges on these dedicated lines. A company with locations in Seattle, Phoenix, Atlanta, and headquarters in Chicago might have a “hub and spoke” arrangement of TIE lines from their headquarters to each regional office. Each location then might have FX lines to adjacent cities; for example, a company based in Seattle might have an FX
line to Tacoma, Kent, and Everett. There were corresponding inbound services where the called party paid. For example, the original Zenith operator provided toll−free calling in the days of manual switchboards. The inbound WATS service, now known as 800 service, was originally also structured in bands. Finally, for local toll service, remote call forwarding (RCF) allowed people to sign up for telephone service in a foreign exchange and have them make a long distance call from Tacoma, for example, back to Seattle at your expense. Although this was more expensive (depending on the number of calls) than FX, an advantage of RCF is that you can receive multiple calls at a time. It soon became apparent to people working in the Phoenix location that they could call their uncle in Kent by first asking the company operator (later by dialing) for the TIE line to Chicago. They would then choose the TIE line to Seattle and finally dial across the FX line to Kent. The PBX, although not smart, did allow a person to dial up the TIE and FX lines. The important fly in this otherwise ingenious solution (ointment) to high−cost long distance telephone service is that each TIE or FX line could only handle one call at a time. The challenge for the telecommunications manager was therefore to figure out the optimum number of TIE lines between locations to minimize cost and waiting time for the TIE line, while maximizing savings across the commercial long distance circuits. About this time, AT&T noticed a small drop in its long distance revenue from such business and a sharp increase in the number of leased lines it was providing. Now, clearly it is much more profitable to rent a telephone channel out at $0.25 per minute than to lease that capacity to a corporation for 1,000 per month. One should also be aware that the average corporation will not pay these prices, but smaller companies and independent contractors may! On average, 75 percent of the paying public is overpaying the cost of long distance because of the complexity and the various changes that take place. Recently, the three top providers of long distance service raised their rates by 7 percent (12/2001). The impact was primarily in the area of basic long distance service. This means that many small companies have subscribed to a plan with the carrier. The carrier selects the plan that best fits the customer’s dialing habits and number of circuits used (lines). However, the plan is current at the time of the deal and may change several times in the next year. Better pricing or packaging may become available the very next day. The consuming public may not realize that the new package is available and continue to pay the agreed to rates for the next x years, costing them hundreds to thousands of dollars extra per year. To rectify the problem, many organizations periodically call the carrier and ask for the best plan to meet their dialing habits. Once again, the best plan is selected at the time of the call, not forever adjusted automaticall.

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