One of the most popular posts in my previous blog was an article I wrote on SIP Trunking in November of 2007. In the post, I listed the differences and advantages of SIP Trunking over PRI. I also indicated that there would be “very few, if any, new PRI circuit deployments in Canadian urban locations, within five years”.
Well, it appears that at least in Canada, I may have to add another five years before my prediction becomes reality (even that may be too optimistic). In the US, there has been healthy market growth and there are many service providers. In Canada, the adoption of SIP Trunking has been minimal. Why? For the same reason that Canadians pay among the highest rates for mobile phone and broadband Internet services: a lack of competition.
The Incumbents have been reluctant to roll out SIP Trunking since these services would cannibalize their highly profitable traditional PRI revenues. More SIP Trunking service providers are beginning to emerge and by the end of 2012, all of the Incumbents will be offering some form of the services. However, I don’t expect to see aggressive pricing any time soon which will further limit Canadian market growth.
While the immediate recurring cost savings may not be dramatic when compared to traditional PSTN circuits, Canadian enterprises should still consider the benefits associated with SIP Trunking. Here is the comparison from my original article with some updates:
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PRI |
SIP Trunks |
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Circuits & Hardware |
Physical connections:Each circuit requires physical connection and costly termination hardware. | Connections are virtual:Number of available trunks is a function of available bandwidth, not physical termination hardware or circuits.Depending on your requirements and the type of service offering, Session Border Controllers (SBC) may be required for security. SBCs can be a significant cost consideration. |
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Scale / Growth |
Scaling up requires the installation of new circuits and additional termination hardware at specific increments. In the case of PRI the increment is 23 voice channels. | Scales up or down easily and quickly (a software configuration change) and can offer automatic and on-demand burst capabilities.While the technology accommodates these advantages not all service offerings will provide them. |
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Backup / Redundancy |
Providing sufficient backup circuits to remote sites in an IPT-distributed architecture can negatively impact the ROI.Only way to accommodate loss of hardware or facility where PRI’s terminate is to build-in excess capacity with associated cost impact. | Automatic IP re-routing capabilities allow practical geographic distribution of PSTN connectivity to sites with limited or network redundancy.Can be designed to retain PSTN reachability and capacity in the event of the loss of terminating hardware (or even an entire office location) without the need to build in excess capacity. |
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Cost |
Cost is usually per circuit per month.If you require one, or a few, more voice channels than the fixed increment, the cost model for PRI is inefficient. | A variety of pricing models (i.e. usage based) are likely to emerge, including on-demand capacity. Relative to PRI circuits and the associated supporting hardware, IP Trunking costs are likely to be significantly lower.Unfortunately, in Canada the pricing models have not been compelling to date. However, competition is increasing so hopefully that will begin to change soon. |
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Capacity Planning |
Additional capacity must be planned well in advance since considerable lead time may be required for the ordering and installation of new circuits and termination hardware. | While capacity planning is still important, adding additional capacity can be as simple as a software change. Additionally, providers are likely to offer burst capabilities to accommodate brief periods of higher than anticipated utilization. |
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Disaster Recovery / Business Continuity |
While possible, diverting calls to alternate locations can be complex and expensive.Diversity across service providers is usually cost prohibitive. | The technology allows for automatic call rerouting to pre-defined locations should the location go offline (a huge business continuity benefit).Can accommodate diversity across service providers much like is done today with Internet access via BGP. |