Networking

Reduce Telecommunications Cost with SIP Trunks

Scott Lowe is considering a switch to SIP trunks to replace his organization's T1 circuit. Saving money is a considerable benefit, but what are the drawbacks?

Between T1 costs, a "billing charge" and local and long distance usage, Westminster College spends quite a bit of money on communications costs each month. The billing charge is a several-hundred-dollars charge that we incur for the privilege of receiving an itemized statement at the end of each month. We're a relatively small place, so we have just a single T1, which is dedicated for outgoing calls. For incoming calls, we have a pair of PRI circuits in place and, because of rather strict contract termination terms, will stay in place for the next couple of years. Our outgoing T1, however, is up for grabs.

In order to reduce costs, we're considering the use of SIP trunks to replace our T1 circuit. The company we're considering sells an "unlimited" SIP trunk for $30 per month. This price includes all local and long distance calling. The only charges incurred are for international and incoming toll free calls. Now, you might notice that the T1 I mentioned handles just our outgoing traffic and you might be wondering how our incoming 800 calls fit. Our 800 calls are currently handled on our incoming PRI circuits, but these toll free lines would be moved to the new SIP service.

Moving to SIP trunks will eliminate 95% of our usage charges, but does introduce some questions. First off, T1 circuits have proven their resilience over decades of use. As a point-to-point circuit, quality of service on a T1 circuit can be guaranteed. With SIP trunks, there two connectivity options, only one of which can be guaranteed by a SIP provider. First, a SIP provider can install a secondary Internet connection into a facility which they control exclusively. As a result, quality and uptime can be better guaranteed. More commonly, however, and at much less cost, SIP trunks can be brought in over an organization's existing connection to the Internet. Although this is less expensive, SIP providers won't guarantee the availability of your third party connection and network congestion may become an issue.

On the upside, I've already mentioned that a SIP trunk over an existing connection can save money. But also consider this: When your SIP trunks aren't in use, the bandwidth is still available for other uses. When compared to an existing T1 or PRI line, which sits unused when no calls are in progress, it's a bit more efficient.

A SIP trunk can be connected to any IP-PBX that supports them. We're currently exploring the Avaya IP Office PBX, which supports external SIP trunks. Moreover, if you're using T1 or PRI circuits, you have to add them 23 at a time. SIP trunks can be added one at a time so it's easier to buy just what you need.

Another downside to SIP trunks lies in standards. Although there are dozens upon dozens of SIP vendors popping up all over the map, not every SIP vendor is supported by every IP-PBX manufacturer. Instead, providers and manufacturers are going through a certification process to help ease interoperability. Further, some legacy telephony services require special consideration when making the translation to the IP world. In particular, if you decide to go down the SIP road, make sure that fax and DTMF are well supported by your SIP vendor.

Also bear in mind quality issues, particularly if you're using your own Internet connection. As long as you have sufficient bandwidth and your Internet provider has a reasonable peering arrangement, quality shouldn't be a huge problem. However, since SIP rides on IP, you are more susceptible to echoing or dropped calls than you would be with traditional circuits.

As I mentioned there are a ton of vendors in the marketplace now. We're looking at bandwidth.com's unlimited trunks. Bandwidth.com and the Avaya IP Office PBX are not yet certified for interoperability, but bandwidth.com provides a gateway device that enables this capability.

Have you gone or are you considering going the SIP route? Share your experiences in the comments section. I look forward to learning more about this technology as I take the plunge at Westminster College.

About

Since 1994, Scott Lowe has been providing technology solutions to a variety of organizations. After spending 10 years in multiple CIO roles, Scott is now an independent consultant, blogger, author, owner of The 1610 Group, and a Senior IT Executive w...

9 comments
bob.pierce
bob.pierce

Scott, You should consider the enterprise solution of 1-VOIP.com. We provide unlimited lines/trunks to your PBX. E.g (10) 4 Line IP phones = 40 Free Call Paths! All calls throughout the U.S and Canada are local calls. All inbound calls are free and extension to extension and all other 1-VoIP customers calling is unlimited. You only pay for outbound minutes. E.g 12,000 minutes (outbound) x $.01 = $120.00 per month. That's it! With the money you save, get a dual WAN router, put in two broadband providers and have redundancy ready to go for less than half the price of a single T1! Call me if you have questions at (405) 694-4758 or visit www.1-VoIP.com

Carmen58
Carmen58

Your way off base with this article. A Dynamic Pri will provide enough Bandwidth for both voice and data. Yes it gives 23 channels, but you will require, at minimum, a T-1 for the required bandwidth to use your SIP trunks. So your back to buying a 24 channel circuit. Pri circuits, going Dynamic, provide the 1.5 meg of pipe to use for both voice and data. If no voice calls are being used, then it's available for data and not fractionalized. SIP being cost effective is a myth and is only popular due to the residual profit the vendors enjoy. There is no reason you should have multiple Pri and T-1's at your site. One cost affective and extremely reliable Dynamic Pri is all your School requires. If you need 8 or more SIP Trunks, your back to buying a T-1 backbone at the same cost or more than the one Pri would cost. Don't fall for the misinformation of the sales people!

john.jelks
john.jelks

Not so. One can get an integrated T (data and voice, aka: split T). One can also turn down channels on a full T and add varying numbers of trunks. If the CO can not handle this, find one who can. I am not against SIP here, it's great as long as the PBX can handle mixed trunking without sending calls into 'fast-busy-land'. -JJ-

harrywong.sk
harrywong.sk

SIP's performance truly demands on how you connect with the SIP trunk provider. I recently attended a conference that focuses on SIP peering and connections, and would strongly recommend attending to learn more: http://voicepeeringforum.com/

noel
noel

Hi Scott - SIP trunks are definitely at the point of being a true enterprise grade replacement for TDM circuits. As you state the main driver is being able to dynamically allocate trunks, lots of great features, and for some, cost savings. I put cost savings last because many times SIP trunking can turn out to be more expensive, but it may be worth the extra expense if you use the features a soft switch provides, like ACD and IVR in the cloud, (great for call centers with fluctuations were you have more calls than you're trunked for), the ability to have a phone number from another area code, or even another country, ring to your office (it's cheap in comparison to foreign exchange (FX)lines from the RBOC), and if your site gets evacuated like ours did during the San Diego wild fires, a DID or main number can be programmed to ring elsewhere, yes a phone system can do that too, but not when the building goes up in flames. One caveat to SIP though, most SIP providers are consumer oriented. There are very few that are enterprise focused and have the infrastructure to support enterprise grade telephony that's equal to TDM's five 9's of reliability and provides the same level of customer service for trouble tickets and outages. We have worked with most of the business oriented ones the last few years and some have down right blown up our clients, long outages (realize if you go with hosted SIP/PBX you may lose Internet, fax local, LD all at once), long hold times for opening trouble tickets when outages occur and no follow up RFO (reason for outage). So my advice is (of course I'm partial since I am one, but one that gets paid by the carrier, no cost to you), get a good consultant to help you. We?ve made the mistakes and can steer you away from the bad providers (not just me but any good telecom consultant). I promise you there is nothing worse than telling a manager, boss or CEO that you moved to SIP trunks (they won't know or care what they are) and you've run into some issues and that's why you have no Internet service, Local, LD, or toll free calls. Trust me it?s no fun being the person that recommended the service either. It happens a lot more with SIP than it ever did with Ma Bell. SIP is here and it's going enterprise, just be careful with your expectations and focus on features not so much on cost savings, and if you?re a business, only work with business grade service providers. Most SIP providers only have one or two switches (which provide dial tone) and one or two switch locations which may be across the country from your office. Compare that to good old Ma Bell which has forty or more switches just to serve San Diego, with most switched being no more than 12 miles from your office. By the way Bandwidth.com is ok and so is Smoothstone for larger enterprises. Anyone else have any others?

HAL 9000
HAL 9000

The article was written May 15, 2008, and for the time was about right for US Residents at least. Posting what is effectively an add for yourself/company is frowned on here at TR but I'll leave it put for the time being at least just in the hope that you provide the service to a current TR Author for testing purposes and a possible write up. Col

Michael Kassner
Michael Kassner

I found both the article and comment very helpful. Thanks Scott and Noel.

wild0104
wild0104

We've just starting testing adding SIP lines to our exisiting Telephony infrastructure. We're using a company called Broadvox, and from what I've seen (and heard) using the SIP trunks its virtually identical. We had a very good opportunity to see just how robust they can be about two weeks ago when our LD service was down, we were able to dynamically increase the number of SIP trunks we had and allowed users to still make LD calls while the issue with our telco was being resolved. I think its only natural with the evolution of IT to have the phone system move over to an IP based service. Will there be hiccups in the beginning? Yes. But will it eventually become as stable as POTS? I believe so. Will enable us to do bigger and better things? Most definetly.

whl
whl

Make certain you can make and receive fax transmission over your SIP trunks. Additionally, verify that when dialing locations that have auto-attendant that you can enter DTMF digits. Don't have any of your current numbers ported over until you have adequately and fully tested the service using temporary numbers provided by the SIP trunk provider.