19/04/2001 Abossé AKUE-KPAKPO TOGO TELECOM 1 Abossé AKUE-KPAKPO Telecommunication Manager Chief, Internet and Business Services Division Tel. : (228) 21

19/04/2001 Abossé AKUE-KPAKPO TOGO TELECOM

1

Abossé AKUE-KPAKPO Telecommunication Manager

Chief, Internet and Business Services DivisionTel. : (228) 21 68 54 / 04 01 81

Fax. : (228) 21 88 36E-mail : [email protected]

IP TELEPHONY:

Challenges and Prospects

TOGO TELECOM


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CONTENTS

I – INTRODUCTION TO IP TELEPHONY

II – TECHNICAL ASPECTS

III – CHALLENGES AND PROSPECTS

IV - CONCLUSION

IP TELEPHONY:Challenges and Prospects


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CONTENTS

I – INTRODUCTION TO IP TELEPHONY

• Preliminary remarks

• Definition(s)

II – TECHNICAL ASPECTS

• Characteristics of the two networks

• Types of communication

• Developments



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PRELIMINARY REMARKS

The advent of IP telephony is perceived as a fundamental change in telecommunications of the same magnitude as the replacement of the telegraph by the telephone.



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IP telephony is founded on the Internet network using the IP protocol.

Conventional telephony is founded on the public switched telephone network (PSTN).

PRELIMINARY REMARKS



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In general terms, IP telephony means voice transmission over the public Internet network.

Definition



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It is also referred to as voice over IP (VoIP). This service means more or less the same thing, except that in some cases it is not the public Internet network which is used.

Definition



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CHARACTERISTICS OF THE TWO NETWORKS

Highly reliable

High voice transmission quality

Real time or synchronous

Simultaneous conversation between two points on Earth

Relatively reliable

Acceptable transmission quality

Deferred time or asynchronous

Connectionless

PSTN IP



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Three main types:

Types of communication

PC to PC

PC to telephone

Telephone to telephone



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Gateway

Public Switch


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GatewayGateway

Public Switch


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Development

1994 : First trials of type PC to PC

1996 : Trials of type PC to telephone

1997 : Significant progress

Emergence of telephone to telephone

1998 : Integration of voice on the web

Emergence of free call centres



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Growth

Booming market

Estimate international VoIP traffic

1998 : 200 million mins.

1999 : 1 750 million mins.





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Some forecasts

IDC : 1999 : 2.7 billion mins.

2004 : 135 billion mins.

Deltathree.com : 2000 : 16 billion mins.

2005 : 35% of all international traffic



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III – CHALLENGES AND PROSPECTS



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Challenges

Large amounts of money at stake

Many new entrants

Challenges for incumbent operators in Africa?



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Challenges

Business opportunities

Fear of a fall in turnover



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Business opportunities1– Internet creates new demand for specialized links.

2 – IP telephony generates national traffic to the Internet network.

3 – Other income from the Internet (e-commerce, website development and hosting, other services).



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0

5

10

15

20

25

30

35

40

45

Number of SL

1998 1999 2000 2001

Years

Evolution in demand for SL

Annual demand Cumulative demand



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Business opportunities

0

100000

200000

300000

400000

500000

600000

700000

800000

U S D

1999 1999 1999 1999

Y e a r

Series1

Series 1



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Fall in turnover

Revenues from international traffic

Revenues from settlement of accounts for international traffic



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Rates 30 to 50% lower

Potential fall in turnover for international traffic

Examples

Fall in turnover



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KPN states that 21% of its traffic is generated by the Internet.

Deutsche Telecom states that, in 1998, calls to the Internet increased by 86% to7.7 billion minutes of traffic, i.e. 164% of all its outgoing international traffic.

Fall in turnover



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IP telephony provides a means of bypassing switched networks.

IP telephony is not regulated.

Possible drain on foreign currency.

Fall in turnover



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Fall in turnoverGiven that international traffic accounts for 30 to 40% of total turnover, and

that account settlements may represent up to 30% of turnover, then

there are problems ahead for incumbent operators in our developing countries.



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Will depend on:quality of IP telephonytariffs for international callscost of switched networkslegislation

Prospects



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If the quality of IP telephony improves, it will become a must, obliging us to think in terms of progressively migrating from switched networks to IP networks.

If tariffs for international calls are significantly reduced, then IP telephony may remain marginal.

Prospects



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Prospects

If the cost of our switched networks is reduced, then competition from IP telephony will be less acute.

Finally, the future will also depend on the legislation introduced.



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Conclusion Incumbent operators face severe competition in an area accounting for a large proportion of their turnover.

Possible solutions:

Tariff rebalancing

Increasing teledensity to bring down the costs of the switched network



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Conclusion

Establishment of appropriate legislation that takes into consideration the cost of each network

Monitoring of the network to avoid bypassing



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Bibliography1 - ITU Internet reports: IP telephony International Telecommunication Union 2001

2 – Challenges to the network: Internet for development

International Telecommunication Union 2001

3 – ITU News



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Bibliography

Websites

1 – http:\\itu.int\wtpf

2 – http:\\itu.int\itu.docr\gs\council\c00\docs\78.pdf


Documents

19/04/2001 Abossé AKUE-KPAKPO TOGO TELECOM 1 Abossé AKUE-KPAKPO Telecommunication Manager Chief, Internet and Business Services Division Tel. : (228) 21