Users dish out dose of VoIP reality

If you want any evidence about the impact of lean economic times on the networking economy, all you have to do is look at the business model for voice over IP.

Conventional wisdom says that the business case for VoIP should be based on productivity gains from new converged applications. According to a recently conducted Tolly Group survey of 50 leading enterprise network architects, investment pressures brought about by recessionary times are dispelling conventional thinking about deployment of the technology.

In The Tolly Group’s 2002 Enterprise Architect User Requirements Study (see information at, we set out to take a snapshot of the VoIP technology requirements folks like you have, in order to better guide vendors in their product development.

First, a little background about the survey. Of the survey base, 90.5 percent are responsible directly for making VoIP technology adoption decisions and 64 percent have direct product purchase authority. More than 76 percent of the respondents specify, recommend, approve or influence the purchase of VoIP gear across the entire corporation, while almost 12 percent wield equal clout across multiple departments and another 12 percent have such responsibility for more than one organization.

When asked about their organizations’ plans for VoIP, 51.2 percent of respondents said the company plans to prototype VoIP soon (with at least $100,000 committed in the 2002 budget for VoIP purchases). In addition, 34 percent say that VoIP already is in production mode, with at least $100,000 committed in infrastructure investments. And almost 5 percent of respondents say they have completed VoIP installations, while 10 percent have no present plans to adopt.

One of the biggest surprises of the survey came when we asked users why they are deploying VoIP. Here, 52 percent said they are deploying VoIP to reap savings brought about by merging separate voice and data services onto a parallel wiring infrastructure, and almost 35 percent cited savings from toll-charge reduction. Only 13 percent specified the benefits from converged applications as the reason for VoIP deployment.

What we’re looking at here is a classic chicken-and-egg scenario. There will be no significant use of converged applications until we have a converged environment. This demonstrates a very pragmatic view of direct return on investment (ROI), given the economy. Yet we would have expected that most users were looking to VoIP to unify messaging and to build up more sophisticated call centers, not cite the more mundane infrastructure and toll-charge issues.

Another significant finding of the survey surfaced when we asked about the single greatest barrier to deploying VoIP. Here, almost 40 percent of respondents listed “costs/insufficient ROI,” while 27.5 percent cited “implementation complexity.”

While the survey points out there is an emphasis on ROI and cost savings, any initial focus on infrastructure consolidation “is not the real value of VoIP,” says Greg Merritt, vice president of Enterprise Networks at Nortel, who participated in a recent Tolly Group Webcast about the survey. “The real benefit of VoIP is to drive greater productivity by creating new applications that foster productivity among users,” Merritt says.

So there you have it. The benefit from VoIP is in driving productivity gains. I’m not convinced enterprise architects agree. If you are implementing VoIP, have already deployed it or are just thinking about it, let me know where you stand. Is the primary driver for VoIP the promise of productivity gains? Or is it the more practical cost savings from merging voice and data onto a unified infrastructure for avoiding toll charges? Let me know what you think.

Tolly is president of The Tolly Group, a strategic consulting and independent testing company in Manasquan, N.J. He can be reached at [email protected].

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