June 19, 2014

Don't Blindly Buy SIP Trunking from your Incumbent Telco

It wasn't so long ago that AT&T and Verizon would stall on selling you SIP Trunking until they finally realized you weren't kidding and they had to hustle to make sure you actually bought their SIP Trunking service, not somebody else's.

Now it's a different world. AT&T and Verizon are fully on board the SIP Trunking bandwagon, and they sometimes give the impression that they'd rather clear everybody off the PSTN anyway and are happy to push you into convergence.

Funny, though - either way the big guys still erect barriers to anything other than a glide path from their old services to their new ones. Whether it's you pushing them or them pushing you, don't forget that there's a third interested party: all the other carriers who would love to help you out!

I once laid out, via TC2's blog on April 25, 2011, the general principles for giving a chance to succeed to the other carriers that deserve it. Now, with SIP Trunking, it's time to go further. Most enterprises who are serious about competitive SIP Trunking procurements realize that AT&T and Verizon aren't the only ones who do this. They'll employ an RFI process following by technical briefings for the non-incumbent suppliers that specialize in SIP. But in order to make this effective, there's a certain key checklist to follow:

  • Has your design/approach been finalized - will you be going with a centralized or distributed SIP solution?
  • Will the SIP solution be primarily a replacement of local/DID voice services and outbound LD, or will IP toll-free services be used as well?
  • Have SIP pilots and testing been done with multiple suppliers (i.e., have all technical solution offerings fully explored)?
  • Have you competitively negotiated the price or had it rigorously benchmarked via a tested, carrier-neutral process? If not, you will pay too much.
  • Have you included in your documents, and negotiated, all of the prices and rates that you will need? Do you know what these are? SIP voice rates and pricing structures are quite different from TDM voice rates.
  • Have E911 issues and risks been fully vetted?
  • Do you have negotiated terms for SIP services in your existing contract?
  • Do you have SLAs for SIP? [TDM voice SLAs don't apply to SIP]
  • Has the impact on existing contractual commitments for ILEC services been analyzed? There are techniques - like staged migrations - that can be used to address this, but it can be a real gotcha if you don't look at it early on.

And here's one final important tip: Your future negotiating leverage will be compromised if you give a particular supplier an "inside track" to the larger opportunity through a business-unit-by-business-unit rollout. The structure of so many enterprises with key embedded stakeholders up and down - and sideways across - your org chart makes this a particular stumbling block if you don't apply your internal management skills right out of gate of your project.

For more, check out TC2's archive of SIP Trunking commentary and advice. This is a "moment" in the arc of your enterprise's telecom lifecycle that you want to get right. A good start means lower prices, better terms, and the best possible competitive leverage throughout your rollout and beyond.

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This is similar to the major carriers' decision years ago to offer frame relay services, realizing the advantages of cannibalizing their own base rather than having somebody else take the business from them.

The first point - centralized or distributed - is discussed extensively in "Centralized vs. Distributed SIP Trunking: Making an Informed Decision".

I don't believe that the risks and pricing play a large roll in the as is portrayed in this article. Comparitively speaking SIP trunking far cheaper and more resilient than existing TDM services. The cost of the pilot projects delays the savings thst can be realised from the migration to SIP. The larger SP's which are most probably the incumbents and will have thought the issue through carefully in the migration from TDM to SIP and will also have a carrier scale solution to replace the TDM legacy equipment. I can't see the SP's placing their key voice business at risk by providing an inferior SIP Trunking service.

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