VoIP on the verge

Ron McKenzie talked about his 17-year-old son recently to the crowd at the Ottawa technology show GTEC. How teenagers don’t talk on the phone anymore. How his son disappears into his room after school and immediately commences the “equivalent of a 20-way conference call” with his friends – over the Internet.

“When those teenagers hit the workforce,” said McKenzie, Executive Vice-President, Marketing and Business Development for MTS/allstream, “that’s when you’ll see a fundamental change in the way services are delivered.”

Bear in mind that those teenagers will not only demand radically different service delivery from the institutions with which they interact, they will also make up the core of the public sector workforce.

Will the public sector be ready? Will that readiness hinge on VoIP?

A “Frontiers” piece on VoIP (Voice over Internet Protocol) in the September 2005 issue of the Harvard Business Review asks: “How big is VoIP?”

Most major telephone companies in the developed world are at least incorporating VoIP technology into their networks and service offerings.

According to HBR, British Telecom, “the dominant carrier in the United Kingdom, plans to convert its entire infrastructure to VoIP by 2009. Soon, even when calls originate and terminate with traditional telephone technology, they will be carried over the companie’s (sic) VoIP networks. In 20 years, and probably much sooner, the global telephone system will run largely on Internet technology. There will be no distinction between VoIP and the phone network.”

Along similar lines, technology analysts at the Garner Group predict, in Positions on the Five Hottest IT Topics and Trends in 2005, that “voice/data convergence based on IP telephony and VoIP will be under way in more than 95 per cent of major companies by 2010.”

“Convergence will drive additional classes of communications-enabled business applications and cause the greatest upheaval in the telecommunications industry since its inception,” says Gartner. “Every major organization should at least be testing a converged network.”

But it’s not only the juggernaut effect driving adoption of VoIP, for the public or private sector.

At GTEC, Gianni Creta of Telecom Ottawa summed up the main drivers behind VoIP:

1. Cost savings

2. Employee productivity gains

3. Standardizing equipment across multiple sites

4. Previous PBX at the end of its lifecycle

Cost savings, maybe

Gary Cameron, Vice-President, Enterprise Accounts at Bell Canada, agrees that there are cost savings because “Internet transactions are inherently cheaper.” Cameron notes federal government estimates that an in-person transaction costs $15-30, a call centre transaction $2-10 and an Internet transaction – perhaps with a call centre interface – as little as 5-20 cents.

But there are huge implementation costs as well, especially for infrastructure, so even VoIP vendors will tell you that cost savings should not be your only objective.

Employee productivity, sure

Opportunities abound for improving employee productivity. For example, collaborative capacity can be increased by leveraging VoIP for audio conferencing, video conferencing, streaming video and information management.

Employee mobility can be enhanced exponentially by consolidating voice and data on one system, so that employees can work seamlessly with head office from home or on the road. Similarly, interdepartmental communications benefit from integrated IP applications.

Standardizing equipment across multiple sites, of course

Standardizing equipment across multiple sites is just one of the achievements the City of Hamilton accomplished with VoIP. In 2003, Hamilton rolled out an integrated data and voice conversion venture which has deployed more than 3,500 phones over 135-140 locations, says Christine Swenor, Director of IT Services for the city. It’s a strictly internal conversion at this point, but actual savings from the new standardized system have amounted to $1.5 million a year.

Previous PBX at the end of its lifecycle, yes!

Telecom Ottawa’s Creta cites a Toronto customer with several business divisions and a dispersed workforce whose PBX telephone system required $60,000 in upgrades. The customer chose to implement an IP platform at “a fraction of the capital cost of upgrading the PBX system” – but also achieved seamless calling between various business divisions and connectivity for their mobile workforce.

Capital infrastructure replacement is the pivot point on which adoption of VoIP will turn in the federal government, according to Victor Abele, Acting Senior Director, Business and Service Technology, Chief Information Branch at Treasury Board Secretariat.

“I don’t see that there’s going to be a business case for VoIP, with some exceptions perhaps,” says Abele, “where it’s not directly tied into a capital replacement of some telephony infrastructure.”

Once we’ve got the technology sound, he says, so that we don’t stop being able to answer phone calls, we’ve got to get to the next step where we’re building the applications that are going to really going to make the business case for what we do with VoIP.

That, he hadds, is because VoIP is far more than just a replacement for your telephone switch or your 1-800 service. “It’s a much more significant piece of technology that stands to revolutionize the way we do business with clients.”

But client service, above all

Within the federal government service transformation agenda, which aims to create services that are more transparent and accessible and that anticipate client needs, what VoIP is about for Abele is true convergence – of a telephone channel with an Internet channel, in terms of supporting the “self-serve” of clients navigating the Web. The interesting opportunity that VoIP gives us, says Abele, is that it allows us to more intelligently exploit the citizen’s channel of choice, which is still the phone.

“Right now we are limited by the network rules and the routing rules of our 1-800 networks and call centres,” Abele says. If we can build software into the voice network side, we can exploit the software applications that we already have online, and we can route those calls more effectively to save costs, improve accessibility and get people to the right place on the first call.

The technology exists to do this now, he says, but increasingly, as the federal government moves into service transformation, we’re talking about a customized universe, a personalized interaction. So instead of going into a queue where you are one of thousands of callers in a day, as you come up you get directed right to the specific person who can meet your particular needs.

But, according to Abele, really interesting things will start to happen as VoIP is further deployed across multiple levels of government. VoIP will give governments a capacity to meet client needs across jurisdictions. For example, there could be one-stop service for a recently bereaved person who needs access to information and transactions to meet federal social service, federal tax, provincial probate and municipal voter registration cancellation requirements.

Are we there yet?

Some of us are.

A number of municipalities, provinces and public sector institutions are well launched with VoIP.

Durham Region, for example, has a new $10 million administration building, according to Allison Vale of Telus, that is “VoIP’d up, down and sideways.”

And Hamilton, according to Christine Swenor, has already met its objectives in migrating to VoIP after only two years: lower operating costs, improved service to end users and positioning the city for the future. “We haven’t nearly tapped the potential of VoIP,” says Swenor.

But some of us are not there yet.

According to Victor Abele, 5-20 per cent of the marketplace is switching to VoIP; federal government migration is less than 5 per cent.

Abele says five or six departments are in testing or at the pilot project stage, with several others “looking at it from a distance.” Agriculture Canada is contemplating a move to VoIP when it relocates.

When will we be there?

So will the federal public sector be ready for today’s 17-year-olds, who’ll be expecting VoIP-enabled services and a VoIP-enabled workplace in as little as five years?

Victor Abele admits freely that there will be modest movement within the next 5 to 10 years, as departments are required to replace legacy infrastructure. We’re likely to see incremental deployment among early users in the short term; in the medium term, those who have been in testing mode will start to experiment with applications that will demonstrate the real value of VoIP. In the longer term you’ll start to see a gradual deployment of the infrastructure on a more wide-spread basis, as larger organizations across government move on-stream.

But Abele raises an interesting question, one he has posed to “the guys at the centre of the industry”: How many programmers are there with experience in developing VXML (Voice Extensible Markup Language) applications? That, he says, means “people who have cut their teeth on VXML applications and learned lessons about how to make all the interfaces work elegantly and efficiently, and in a way that meets the business needs of the client and improves the experience for the citizen.”

“I didn’t get an answer suggesting that we’ve learned those lessons yet.” says Abele. “We’re putting it online and we’re getting our feet wet, but I haven’t seen that we’re that sophisticated with VoIP, that we know exactly what we’re getting into.”

Put another way, we sense the potential more than we see the substantive opportunity. Abele stresses that this is his personal opinion, but Gartner research supports his opinion (see Gartner’s Hype Cycle for Government Technologies, 2004).

So will we be ready for the teenagers of today, as they enter both the citizen client ranks and the workplace of five years hence? Could be a bit of a disconnect, if Victor Abele is right.

Catherine Morrison (cmorrison@morrassoc.ca) is a freelance journalist based in Ottawa.

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