Transcript Slide 1

The Business Case for
SIP Conferencing
Ray Adensamer
Convedia Corporation
Internet Telephony
Conference and Expo
October 7, 2004
Topics
• Today’s Challenges using TDM Technology
• VoIP Conferencing Solutions
– Platform Characteristics
– Network Characteristics
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Solution Benefits
Financial Comparison: TDM vs. VoIP Approaches
The Business Case for IP Media Servers
Conclusions
October 4-7, 2004 • Los Angeles, CA • www.itexpo.com
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Conferencing Service Providers (CSPs)
Today’s Business Challenges
• Increasing Competition
(particularly in unattended audio conferencing services)
•
Competition is driving down prices
– Good for consumer
– But not ideal for CSPs…
• Result?
– Margins for CSPs with legacy TDM-based conferencing
architecture are being squeezed!
October 4-7, 2004 • Los Angeles, CA • www.itexpo.com
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TDM-based Conferencing Architecture
Characteristics:
CSP
TDM Conferencing Bridge
• Proprietary integration
between:
– application and
Analog
Phones
PBX
PBX
PSTN
Company X
Company Y
Analog
Phones
– media processing
• High per-port costs in
TDM Conferencing Bridge
• High TDM transport costs
through PSTN
• Separate networks
required for voice, video,
and data conferencing
Home Office
Mobile Phone
• Complexities around
adding new services
October 4-7, 2004 • Los Angeles, CA • www.itexpo.com
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More generally…
TDM-based Service Architectures
Conferencing
Service Node
Proprietary
Audio Bridge
with
Proprietary
conferencing
software
Messaging
Service Node
CLASS 5
Switch
SUN Card
Proprietary, Monolithic
+ DSP Cards
System with software
+ TDM Interface Cards and Media processing
Embedded in a
hardware
Compact PCI
Chassis
Mobility
Services Node
Prepaid Card
Service Node
Speech Portal
Service Node
SUN Workstation with
PCI DSP and
TDM boards
OS2 Based PC
NT Server
+ ASR Software
+ PCI DSP
+TDM Boards
Proprietary
TDM and DSP Boards
in VME Chassis
Legacy TDM Network
• Each new service required new hardware and software.
• Hardware and software was sold as a “service node” by one vendor.
Typically a proprietary solution.
• Logic for each service is very different, however…
• Media processing needs share a great deal in common
October 4-7, 2004 • Los Angeles, CA • www.itexpo.com
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VoIP Services Approach
Conferencing
Software
Messaging
Software
CLASS 5 Softswitch
Software
Mobility
Software
Prepaid Card
Software
Speech Portal
Software
Service Logic
• Software defined network
IP/MPLS Backbone
Shared
Media
Processing
Resource
IP Media Server
Packet / TDM Adaptation Unit
(Media Gateway)
Legacy TDM Network
• Service solutions are composed
from best of breed software and
media processing hardware.
• Components communicate
through open standard interfaces
• Service logic executes on
off-the-shelf servers.
• Media processing hardware is
shared by many services
October 4-7, 2004 • Los Angeles, CA • www.itexpo.com
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VoIP Conferencing Architecture
IP Service Core
SS7
IP Access
Conferencing
Application Server
Softswitch
PSTN Access
SIP, H.323,
MGCP, MEGACO
IP Phone
SIP, H.323
Phone
MGCP,
MEGACO
SIP with
VoiceXML,
MSML, MOML
Conference
Recordings
PDA/3G Phone
HTTP,
NFS
Cell Phone
PC
TDM
RTP
Media
Gateway
RTP
IP Media Server
October 4-7, 2004 • Los Angeles, CA • www.itexpo.com
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Primary Components of an
IP Conferencing Platform
Conferencing
Application Server
Signaling
Functions of an Application Server
Conferencing
Applications
Call Signaling
Billing Interface
Service Management
and Provisioning
Service Databases
Data Collaboration
SIP with
VoiceXML,
MSML, MOML
IP Network
Functions of a Media Server
Voice and Video
over IP
(RTP)
IP Media Server
Audio Tones &
Announcements
DTMF Detection
& Generation
Audio Bridging
& Mixing
Audio Recording
& Playback
Fax Detection
& Processing
Hot Word
Spotting
Speech
Recognition
Text to Speech
Video Bridging
& mixing
Video Recording
& Playback
Video
Video Switching
Announcements
Audio
Transcoding
Video
Transcoding
October 4-7, 2004 • Los Angeles, CA • www.itexpo.com
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Media Server Features
Tones &
Announcements
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•
•
Network ann'ts
Service ann'ts
Branding
DTMF Collect &
Generate
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•
•
•
•
•
•
•
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Speech
Recognition
Text To Speech
• Email reader (UM)
• Automated
attendant
• Info services
IVR/VRU
Card services
Call centers
Operator Services
Audio Bridging &
Manipulation
•
•
•
•
Automated
attendant
Voice dialing
Voice Portals
Info services
Media Server
Features
Conferencing
Transcoding
Meet-me/dial-out
On-demand
Online gaming
Audio Record &
Playback
•
•
•
Video
Processing
Fax Processing
•
Unified Messaging
Voice-mail (UM)
Call screening
Conference
record/play
•
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Video streaming
Video
conferencing
Video messaging
Applications Enabled
By Media Server Features
October 4-7, 2004 • Los Angeles, CA • www.itexpo.com
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Recap:
Typical TDM Audio Bridge Deployment
CSP
TDM Conferencing Bridge
Analog
Phones
PBX
PBX
Analog
Phones
PSTN
Company X
Home Office
Company Y
Mobile Phone
October 4-7, 2004 • Los Angeles, CA • www.itexpo.com
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Typical IP Media Server
Configuration / Deployment
Conferencing
Service
Provider
(CSP)
Media
Gateway
Conferencing
Application Server
Signaling
Signaling
Voice
Voice
Router
IP Media Server
PSTN
Analog Phone
Firewall
IP Network
Cell Phone
IP Phone
PDA / 3G
Phone
PC
October 4-7, 2004 • Los Angeles, CA • www.itexpo.com
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Conferencing Service Provider Benefits
Significant Cost Reductions
– Lower per-port costs
Up to 70% less cost vs.
TDM equivalents
– Less rack space
Up to 38 times the density vs.
TDM equivalents
– Lower operational costs
• Efficient, economical IP transport
• All media (voice, video, data) on one IP network
Improved deployment flexibility
– Mix and match best of breed equipment and applications
– Achieved through open standards-based interfaces
October 4-7, 2004 • Los Angeles, CA • www.itexpo.com
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Conferencing Service Provider Benefits
continued…
Increased Conferencing Revenues
– IP application vendors offer browser interfaces for selfsubscription
• Simplified usage drives revenues
– Common IP infrastructure facilitates multi-media features
Infrastructure to easily support additional, new
services
– Additional services can be easily added to infrastructure at low
incremental cost
• IP Centrex, Calling Card, Unified Messaging, Call Center,
and much more…
October 4-7, 2004 • Los Angeles, CA • www.itexpo.com
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TDM vs. VoIP Conferencing Solution Analysis
Inputs and Assumptions
• 2 Million Minutes/Mth -- $36 Million Revenue /Year
• Approximately 3,000 ports (based on Busy Hour Attempt calculations)
• TDM Solution Capital and Startup Costs include:
– TDM Conferencing Bridges (with integrated conferencing software)
• VoIP Solution Capital and Startup Costs include:
– IP Media Servers, Conferencing Application Servers, Gateways
• Network Access Costs Identical for comparison purposes
– “Enhanced Service Offload” Scenario
October 4-7, 2004 • Los Angeles, CA • www.itexpo.com
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TDM vs. VoIP Conferencing Solution Analysis
Resulting Operations Performance
Conferencing Operations Performance (1st Year)
$4.0
$3.5
$3.0
$2.5
$2.0
$1.5
$1.0
$0.5
$0.0
10%
39%
Operating Margin
($US Millions)
Operating Expenses
($US Millions)
TDM
Conferencing
Solution
VoIP
Conferencing
Solution
Same Service, Volumes, and Revenues…
But VoIP Conferencing Solution has
lower CapEx driving smaller annual OpEx…
…Resulting in larger operating margin.
October 4-7, 2004 • Los Angeles, CA • www.itexpo.com
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TDM vs. VoIP Conferencing Solution Analysis
ROI of VoIP Solution
Expected Rate of Return
NPV (Three Years)
Payback in about
9 months
15%
$1,572,381
ROI (over Three Years)
179%
NPV (First Year)
$76,379
ROI (First Year)
9%
VoIP Conferencing Solution
Cumulative Cashflow
$400,000
$200,000
$$(200,000)
Startup
Year1
Q1
Year1
Q2
Year1
Q3
Year1
Q4
$(400,000)
$(600,000)
$(800,000)
$(1,000,000)
October 4-7, 2004 • Los Angeles, CA • www.itexpo.com
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Another ROI Analysis…
The Business Case for IP Media Servers*
Inputs and Assumptions
Item
Costs
Revenue
Incremental Costs
Customer acquisition cost
Set up costs
Usage
$150
$5
$0.05 per minute
ASP Prices
Unattended Audio ASP
$.15 per minute
* Source:
“The Business Case for IP Media Servers”
Copyright © 2003 - Wainhouse Research
Available from the Convedia website (www.convedia.com)
October 4-7, 2004 • Los Angeles, CA • www.itexpo.com
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The Business Case for IP Media Servers*
Analysis and Results
Month
Cost per
port
Total
ports
Capital
Investment
(US$)
Total
Users
Set up
cost
(@$155)
Usage
costs
Total cost
Revenue
Cumulative
cash flow
1
$700
200
140,000
333
51,667
29,970
81,637
89,910
(131,727)
2
$600
400
120,000
667
51,667
60,030
111,697
180,090
(51,607)
3
$500
600
100,000
1,000
51,667
90,000
141,667
270,000
28,333
4
$500
800
100,000
1,333
51,667
119,970
171,637
359,910
88,273
5
$500
1,000
100,000
1,667
51,667
150,030
201,697
450,090
148,393
6
$500
1,200
100,000
2,000
51,667
180,000
231,667
540,000
208,333
7
$500
1,400
100,000
2,333
51,667
209,970
261,637
629,910
268,273
* Source:
“The Business Case for IP Media Servers”
Copyright © 2003 - Wainhouse Research
Available from the Convedia website (www.convedia.com)
October 4-7, 2004 • Los Angeles, CA • www.itexpo.com
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Popular VoIP Conferencing Deployment
Conference
Moderator
Web-based
Conferencing
& Moderator
Control
CSP’s
IP Data Center
Internet
Conferencing
Application Server
Gateway
SIP
Phone
SIP with
MSML/MOML
PRI
RTP
Phone
PSTN
Access
IP Media
Server
Cell
Phone
October 4-7, 2004 • Los Angeles, CA • www.itexpo.com
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What the Analysts Say…
“There is an industry-wide movement to deploy nextgeneration IP Media Server-based platforms vs. legacy
TDM conferencing bridges. The new opportunities
provided by this new class of product include the ability to
increase port capacity at dramatically lower costs,
introduce new services on a single platform, and
reduce operations expense…”
Marc Beattie and Alan Greenberg
Wainhouse Research
ConferencingBuyer, October 2003
October 4-7, 2004 • Los Angeles, CA • www.itexpo.com
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Summary
• CSPs facing increased competition,
plus dramatic margin pressure
• TDM-based technology is not competitive with available
VoIP-based conferencing alternatives
• VoIP-based conferencing can deliver higher margins,
unique features, and rapid ROI
• IP Media Servers provide the foundation for next
generation conferencing and beyond….
October 4-7, 2004 • Los Angeles, CA • www.itexpo.com
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About Convedia…
CMS-6000 Media Server
400 to 18,000 Ports
Industry’s most powerful, flexible and
scalable family of media servers
– Common media processing features
– Open standards-based
control and management interfaces
50+ customers,
300+ systems installed worldwide
Partnerships with many leading
VoIP conferencing application vendors
For more information:
CMS-1000 Media Server
100 to 300 ports
Ray Adensamer, Marketing Manager
[email protected]
www.convedia.com
October 4-7, 2004 • Los Angeles, CA • www.itexpo.com
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