Telus breaks out hosted IP service

Telus Corp. has unveiled IP-One, a hosted, packet-based, voice-data service for the enterprise. Industry observers say it’s a powerful product, but it also raises questions about quality-of-service (QoS) and pricing.

IP-One combines voice and data functionality, offering convergence as a hosted solution. All of the switches and routers required to run the service reside with Telus.

It allows users to control voice and data communications from their PCs – which calls go to which line (cell, office, home), time-of-day prioritization, call routing (“find me”), easy call-conference creation capabilities, a Web portal so users can listen to voice mail messages on their computers, and, as voice mail messages are transformed into data files, an archiving functionality, so users can find past messages easily.

At a launch in November, Telus said IP-One spells simplicity.

“Managing the interaction between a unified messaging environment, the Web [and] an audio conferencing environment, would be insanely complex and expensive for a company,” said John Seliga, a Telus vice-president. “Telus’s core competency is in infrastructure management, and managing complex interactions. Let’s pull that back into the cloud. We will continue to develop new IP applications, make them available to companies that are struggling with all this complexity. They can enjoy the benefits without having to worry about supporting it.”

Brian Sharwood, an analyst at SeaBoard Group Inc. in Toronto, said IP-One is “Centrex on steroids” – outsourced like Centrex, but boosted with IP functionality for toll bypass, easy adds, moves and changes, and an improved end-user experience.

But it raises a regulatory issue. Centrex is tariffed – Telus must file prices and price changes with the Canadian Radio-Television and Telecommunications Commission (CRTC).

Is IP-One regulated the same way as Centrex? That could affect the new service’s price, possibly constraining Telus’s ability to make money from it, but perhaps presenting lower costs to customers.

In a statement to Network World Canada the CRTC IP-One is regulated, “as are all publicly offered telecommunications services in Canada.”

Seliga the service is only available in Ontario and Quebec, where Telus operates as a competitive local exchange carrier (CLEC). As such, IP-One faces less stringent regulation than it would if offered in Alberta and B.C., where Telus is an incumbent.

So what happens when Telus turns on IP-One in its incumbent area? “We’re still working through that, but we will be rolling this out westward,” Seliga said. “At that time…we’re confident that we’ll have all of the necessary regulatory approvals.”

Seliga said eight customers have signed up, including application development provider Borland Software Corp.

Chris Corey, regional vice-president, Canada and Latin America at Borland, said that as his company expanded, it became difficult to bring staffers together via traditional telephony.

“I may have a person in Calgary who’s an expert in design. I want to be able to leverage that person for a customer in Toronto. The requirement for us to streamline communications, become a virtual team, was critical.”

IP-One acts as the unifying force at Borland.

“Hard cost savings are in the range of 20 per cent,” Corey said. “A lot of that is in the remote environment, where we had people using long-distance and multiple phone lines – home office, cell phone, plus head office phone lines.”

Borland may be satisfied, but Telus has its fair share of disgruntled clients. The CRTC logged numerous QoS grumblings about the telco over the summer. Telus also missed many QoS indicators on recent reports to the Commission. Add to that a serious fibre chop in Vancouver that left thousands without a dial tone, fires that ate through equipment, and floods, and you’re left with what Seliga called “a year from hell.”

Still, “customer service hasn’t been that much of an issue in our business segment,” he said. “It’s primarily been in our consumer arena. And we are largely over many of those challenges. When you look at some of the exogenous things that hit us out in British Columbia in particular – the fires, the floods…that has not impacted us here in Ontario and Quebec, where we’re launching this service.”

Corey from Borland said Telus’s troubles didn’t dampen his desire to sign onto IP-One. “Their service levels have been great. We have no reason to believe that they would decline.” Sharwood said other potential clients might not be so understanding.

“Telecom and data managers talk to each other. They all know what’s going on in Vancouver. It does play into it.”

Sharwood pointed out that IP-One shares with Centrex a significant problem: as a hosted service, it speaks primarily to companies that are willing to fork management of the telecom system over to a carrier.

“That was always the trouble with Centrex,” Sharwood said. “You lose control, as a telecom manager, of your contact lists, all those directories, everything you put in for your settings.”

Ronald Gruia, an analyst at Frost & Sullivan, said control might be the lynchpin for IP-One, especially when it comes to the large enterprise, which is less likely to leave telecom management up to a service provider.

“On the other hand, for SMEs (small- and medium-sized enterprises) it’s very valuable,” Gruia said. “It’s going to eliminate the headache of having their equipment on premises.”

Borland was worried less about losing control of the telecom infrastructure, and more concerned with losing business.

“If I have one customer that wants to order a million dollars of product and he has a hard time tracking down somebody to talk to, the impact of that is they go elsewhere,” Corey said. “That’s a huge cost to me.”

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