SIP trunking has been attracting considerable interest from both service providers and businesses, and it offers distinct value for each. Businesses can transition from TDM to IP without SIP trunking, but they will not realize the full potential of VoIP, either on its own or in concert with other communications modes. While this may be sufficient for some businesses, SIP trunking opens up a much wider spectrum of possibilities. This Focus Brief examines some of the core benefits that businesses stand to gain with SIP trunking.

SIP trunking opens up a lot of possibilities for businesses, and brings enough flexibility for any size of operation as well as deployment scenario. For some companies, SIP trunking will only be used to enhance telephony, but in other cases the vision will be more akin to supporting Unified Communications.  Aside from enabling new applications and improving voice services, SIP trunking provides several opportunities to reduce costs, and for some businesses that will be the key driver. Whatever your situation, all of the following should be considered as core reasons to use SIP trunking.

1. Lower telephony costs. A key benefit of SIP trunking is PRI replacement or consolidation. T1 connections are expensive and have fixed increments. Each T1 supports 23 voice channels, and if your business needs 30 channels, you must pay for 2 T1s and use only a portion of the total deployment. Most businesses prefer to retain some level of TDM connectivity, so SIP trunking is not often used to totally replace the PSTN. However, where businesses have multiple locations, each with their own sets of PRIs, SIP trunking can be very cost effective by consolidating those PRIs into a more manageable grouping.

A further cost advantage comes with the end-to-end IP connectivity that SIP trunking enables. In this environment, media gateways are not required, and these typically represent the most expensive network elements. Not only does this reduce the cost of existing operations, but as the business grows, Capex requirements to expand your network will be lower.

Another benefit of end-to-end IP is an expanded capability for VoIP services. Aside from extending lower long distance costs to employees, many calling features will now be included with calling plans. With PSTN service, these features are often a la carte and add considerable cost for the business.

2. Easier business expansion. SIP trunking brings an important benefit for growth where businesses have branch offices or are looking to open new sites. With TDM, each location requires physical connectivity, which translates into costly PRIs. SIP trunking enables virtual connectivity, making it more cost-effective set up branch offices with VoIP and other forms of IP communications.

Virtual trunks are not just less costly, but they make the task of centralizing the communications infrastructure across multiple locations much easier. As noted above, these new locations will not require media gateways, so adding them is a simple matter of provisioning sufficient broadband. It’s also worth noting that IP connectivity is not location dependent, meaning that with SIP trunking, businesses can easily enter new markets – either domestically or abroad.

3. Increased flexibility. SMBs in particular need to be responsive to changing market conditions. SIP trunking makes businesses more agile in a few ways. Unlike PRIs, which have a fixed set of voice channels, businesses can now just take as many trunks as they need. This is like an on-demand model of connectivity, which helps SMBs control costs and not over-spend on these services.

Aside from better cost management, businesses can now respond more precisely to customer needs. One example would be a new product launch where the business needs to handle a surge of inquiries or sales leads. Another would be staffing up for a short term situation such as a promotion or a seasonal event.  Conversely, at the end of these cycles, the business can scale back down again.

SIP trunking helps businesses have more control over their connectivity, not just in terms of costs, but also in managing their use of services. In the PSTN world, not only would these variances in usage be expensive, but in many cases the business would be dependent on the service provider to make these changes. This is not the kind of flexibility SMBs need in today’s market.

4. High Definition audio and video. This capability is one of the most attractive features of SIP trunking. With end-to-end IP, HD becomes feasible, and with that a new world of opportunity opens up. Until recently, TDM has had a clear advantage over VoIP in terms of quality. However, with a properly engineered network, VoIP can provide superior audio, and HD is the best example of this.

Most businesses are perfectly content with TDM quality, but once they experience HD audio, that perception can quickly change. The experience is similar to HD TV in that once you see this, it’s hard to go back to regular TV, especially when the cost of trading up isn’t that substantial.

With this ability, the benefits are numerous.  Just thinking of audio, HD gives the contact center an edge in communicating more intensely with customers. The same holds true for sales pitches, product demos and training. If video is added, HD makes for a much richer experience, whether using conventional videoconferencing or telepresence.

5. Collaboration. This benefit may just be one word, but it represents where communications is heading as IP becomes the lingua franca of IT. SIP trunking may be good news for VoIP, but it’s very good news for collaboration. With VoIP, the benefit is mostly about cost saving, but with collaboration, the upside is strategic.

For businesses that are thinking ahead, collaboration delivers greater value by enabling dispersed and virtual workforces to be more productive than they could be with TDM. With SIP trunking, VoIP becomes a stepping stone to Unified Communications, Web applications, voice mashups and presence-based tools. In this environment, businesses are able to take advantage of the latest applications, and perhaps more importantly, SMBs will now have access to the same tools that larger enterprises use to stay ahead of the competition.

Any of these benefits could warrant the adoption of SIP trunking, and there are certainly others worth considering. The important thing to recognize is that SIP trunking is a new capability for businesses, and they need to think more broadly in terms of how service providers can help them be competitive. One of the real strengths of SIP trunking is that all of these benefits can be deployed by businesses, so they need not think of these in discrete terms.  As such, SIP trunking can be just as valuable to businesses who want to remain voice-centric as those who want to take advantage of the full range of communications and collaboration tools that IP networks can support.