VoIP and Beyond

Communications Enters a New Era

VoIP is a catalyst for change

Change at an unprecedented rate

Change with seismic implications

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Structure

This paper takes a bird’s eye view of VoIP’s multi-faceted impact on the market for real-time

services and applications. A total makeover of the environment is taking place and the

boundaries that used to categorize our use of communications are dissolving. This indicates

the need for holistic solutions that address our needs both as business professionals and

consumers — solutions that Siemens markets and implements. They are broadly based on

(a) systems and applications located on the company’s premises or (b) solutions hosted by a

network operator using Siemens carrier class systems. This paper has therefore been

divided into these categories: however they do overlap, i.e. solutions can be based on a mix

and match of (a) and (b).

Terminology

IP is a network protocol. VoIP is the technology that allows telephony traffic to be

transported over IP networks: it’s the technology that disrupted a real-time communications

model that had been in place for 125 years. VoIP started on the Internet, which is an

unmanaged network, but it is now being used on corporate intranets and in the network

cores of service providers.

The term IP Telephony is also used. In the office environment it is a convenient way of

indicating that the functionality of an IP, packet-switched solution is the same or similar to

that of the legacy PBX. IP Communications is an umbrella term. In this paper it is used to

encompass the media types (email, Instant Messaging (IM), Voice and Video over IP) and

real-time applications such as presence and push email.

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Contents

Executive summary p.4

Overview p.4

Transitioning in enterprises p.5

Flexible, cost-effective migration p.5

All-IP environments p.6

Transitioning to Wireless LANs p.6

The service provider sector p.7

Common goals: different transition strategies p.7

IP Multimedia Subsystem (IMS) p.8

Push to talk over Cellular p.8

Hosted services for enterprises p.8

IP services in the home p.10

VoIP for cable companies p.10

VoIP devices for the home p.11

Conclusions p.12

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Executive summary

IP communications is transforming the way people work together, play and stay in

touch, creating exciting opportunities as well as intense competition. Migrating from

legacy circuit-switched environments to next-generation IP network is a significant

challenge for enterprises, large organizations and other businesses as well as carriers

and service providers, i.e. fixed network, mobile network, and converged network

operators. They require strategies and solutions that leverage the value of legacy

installations and at the same time facilitate the implementation of IP-centric services

and applications.

Given the size and scope of the task it is clear that partnerships are required: more

specifically, a partner is needed whose technology and solution portfolio matches the

breadth and depth of the challenge. In addition, that partner should be able to

demonstrate a total commitment to the set of groundbreaking technologies, solutions

and devices that the term “IP Communications” encompasses.

Siemens has the requisite set of capabilities and an unmatched portfolio for both

enterprises and service providers, as this paper will demonstrate. Highlights include: a

carrier-class platform that enables cost-effective migration from TDM to IP; platforms

optimized for use in enterprises; a suite of real-time, presence-aware applications for

enterprises; and a service provider solution that provides central multimedia control for

mobile and converged networks.

Overview

A decade ago Voice over IP (VoIP) was feasible but not practical. Five years later it

had become a seriously disruptive communications medium, but even then its role as

an IP Communications catalyst was undervalued. Now we are transitioning to a

communications-centric economy — an exciting era that combines voice and

multimedia with mobility, a consistent user experience and more — much more.

Convergence is not simply taking place at the network level, it has moved on from

voice-only services and now takes in just about everything you can imagine: TV,

photos, games, maps, stock reports, news feeds and so on. And broadband access in

the home is enabling ‘triple play’ service offers that feature video-on-demand and

‘smart’ recording in the network.

When voice is integrated with other media the user’s device becomes a multimedia

switchboard that uses the ‘click-to-call’ paradigm. It may be a desktop PC employed in

the office environment or a smartphone used by business and consumer users when

they are mobile. This means that VoIP represents the first link in a pervasive, value-

added chain that extends to the convergence of real-time comms with real-time data.

In addition, Wireless LAN technology is being used to make VoIP calls in offices and

hot spots. The new hybrid Wi-Fi / DECT phones enable both wireless VoIP and

regular telephony. And 3G mobile networks and phones are set to deliver wide-area

VoIP in the second half of the decade.

The impact of VoIP-centric networks, services, applications and devices is seismic, but

so far we have only seen the tip of the IP Communications iceberg. At the same time

the communications industry and its business customers are facing a formidable set of

challenges. Siemens is a leading player in the industry and we meet those challenges

across the board. They are met for enterprises as well as fixed and mobile network

operators, which is important since it allows us to mix and match communications

functionality in order to deliver the optimum solution to our customers.

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Transitioning in enterprises

Large enterprises have large phone bills so these companies were the early adopters

and the transition to VoIP was made in two main phases. The first was the addition of

gateways to corporate telephony switches so that the Virtual Private Networks (VPNs)

employed for data communications could be used for voice. This development

eliminated the need for expensive leased lines. Operating costs were therefore much

lower; administration could be centralized; and the full functionality of PBXs could be

extended to small sites. In this phase VoIP was simply the transport mechanism: the

VPN became the carrier-class equivalent to the Internet.

The second phase involves migrating to IP Communications, i.e. delivering real-time

applications to the relevant employees. This process involves new communications

platforms (IP PBXs) and new devices (IP phones). The way that they are implemented

within corporate environments varies: different companies have different requirements

and they will proceed along different timelines. The business case for IP

Communications is compelling, but companies have made significant investments in

legacy hardware. Flexible migration strategies are therefore needed and to implement

them companies need a partner that has a flexible set of solutions.

Flexible, cost-effective migration

Siemens is a transition specialist. The company has won awards for its migration

strategy, which combines minimal disruption with the protection of legacy investments

in PBXs, phones and cabling. This is achieved via so-called converged platforms, a

development that the company pioneered.

Converged platforms protect investments in legacy phones and cabling as well as

PBXs. They also enable interworking with legacy PBXs.

As illustrated, converged platforms such as the HiPath 4000 employ circuit- and packet

switching in the same system. One side connects to the PSTN and the other to the

LAN. Legacy phones remain in place or they can be connected to the new platform via

the circuit switched interface. IP Phones connect to the packet switching interface.

Thus, only those employees who need IP Communications functionality are given IP

phones. More IP phones can be added at any time and when the time comes to

replace the legacy system the converged platform can take over the regular phones

and the cabling.

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All-IP environments

Enabling elegant, cost-effective transitions from TDM to IP is important, but we are

moving towards “All-IP” environments, as illustrated in this schematic.

HiPath platforms provide call processing and IP communications functionality to a wide

variety of client devices. In addition, many enterprises and other large organizations have or

are implementing a complementary Wireless LAN infrastructure.

Platforms such as the HiPath 2000, 5000 and 8000 are native IP platforms. These

switches interoperate with legacy PBXs via gateways and they can be mixed and

matched with converged platforms. This capability allows migration to proceed along

different timelines at different sites, e.g. the headquarters of the company will typically

move to an all-IP infrastructure before the smaller offices. It’s therefore clear that the

breadth and depth of the Siemens portfolio enables migration to align with corporate

strategies and thereby deliver cost-effective solutions.

Enterprises, network operators and homes are migrating to all-IP environments: it’s

only a question of time. Enterprise-wide networks will evolve in different ways, as

indicated in the previous paragraph, but there is a generic topology. Relatively large all-

IP switches will be located in the company’s data centers and they will provide services

to other sites. These centers will typically host mainstream business processes such

as CRM and ERP and technical resources are on hand when the organization decides

to integrate real-time communications with these real-time data processes.

Enabling VoWLAN

The Siemens WLAN portfolio enables data communications as well as robust, wireless

VoIP. It allows companies to realize the benefits of true enterprise mobility. The

portfolio offers wireless devices, access points and controllers, along with management

software and professional services.

The HiPath Wireless Controller is the centralized high-performance platform from which

up to 200 access points can be controlled and managed. It can be interconnected with

other wireless controllers to scale the mobility domains to thousands of access points.

Controllers are available in a number of hardware configurations suited for different

sized deployments. Located anywhere in the network, the controller aggregates all

clients connected to the HiPath access points as well as those of third parties.

In addition, Siemens can supply robust access points and Wi-Fi devices for use on

factory floors and other industrial locations. Moreover, both the office and industrial

WLAN installations can be integrated and managed from the same system.

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The service provider sector

The service provider sector comprises fixed and mobile network operators, cable

companies, ISPs and virtual network operators. The first four categories employ

different technologies and network architectures but they are all transitioning to IP and

recognize the pivotal role of VoIP. Regular virtual network operators do not own any

infrastructure; they lease capacity.

Common goals: different transition strategies

Voice revenues in fixed networks have declined as a result of intense competition and

the ability to bundle a VoIP service with Internet access. Telephony will therefore

become a ‘free’ service that is employed alongside Instant Messaging (IM) and email.

Revenues will come via compelling ‘bundles’ of added-value services, e.g. the so-

called triple-play combination of TV, Internet and Telephony. Network operators are

therefore starting to compete with cable operators and vice versa.

The market will continue to pay a premium for mobility. In cellular networks voice is

predicted to remain the biggest revenue source for the next five to ten years. MNOs

are transitioning their network cores from circuit- to packet switching primarily to reduce

OPEX, but this process is also needed to facilitate the delivery of value-added

services.

Migrating to IP is a formidable challenge for both fixed and mobile operators.

Significant investments are required and regular services must be maintained in

parallel with the introduction of new added-value services. The Siemens SURPASS

platform meets the transition needs of both network categories and it also enables

flexible transition strategies to be implemented. The SURPASS hiQ 8000 softswitch

platform allows network operators to construct an IP overlay network and, as

illustrated, the SURPASS hiE 9200 enables a seamless transition from TDM to IP.

SURPASS hiE 9200 legacy TDM and IP-based Next Generation Networks. It incorporates all

the functionalities of EWSD, the world's most successful switching system, and those of the

carrier-grade SURPASS hiQ 8000 Softswitch on a single platform.

In addition there is a portfolio of integrated voice, video, audio and data services for the

home and for the business sector as well as applications such as IP Centrex, unified

messaging and video telephony. And last but by no means least, there is the Siemens

IMS solution for the delivery of IP-centric services over the new core networks.

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IP Multimedia Subsystem (IMS)

IMS provides unified session control for voice, real-time media and data services. Its

open architecture allows for access independent service delivery. This groundbreaking

solution encompasses all the wireline and wireless networks we employ at home, in the

office or on the move. In other words, it enables the creation of converged, unified

domains. This means that platforms can be located in the networks of wireline

operators and ISPs. Consolidation is achieved via upgrades to the core networks, but

no changes are made at the access level. IMS is access agnostic and this allows SIP-

compliant, multi-radio phones to provide a consistent user experience over both

cellular and Wi-Fi networks.

IMS was specifically designed to enable real-time, user-to-user mobile functionality

such as rich voice services and video telephony. Key mechanisms include session

negotiation and management, QoS and mobility management. The platform also

allows operators to offer IM as well as multimedia conferencing and chat rooms. In

addition, IMS enables server-to-user services such as email push and click to dial.

The architecture also allows different services, e.g. presence, to share common

components. Thus, no more communication island solutions: no more service silos.

Instead, operators can create a dynamic service environment via the ability to

introduce new services, quickly and economically. The service island model also

needed to change since it makes roaming virtually impossible and without roaming

many users, particularly business users, would be less than impressed with the new

services that were on offer.

Push to talk over Cellular

Push to talk over Cellular (PoC) is another innovative IMS service. VoIP enables

efficient use of radio resources, which are reserved for the duration of talk spurts

instead of for an entire call session. This translates into much lower charges: only talk

time is billed so two or more parties can stay ‘online’ for hours yet at the same time it is

very profitable for operators — a real win:win scenario.

Hosted services for enterprises

One cannot overstate the importance of communications to the business community

and the case for IP Communications is more than compelling, it’s overwhelming.

However, technical resources are needed to implement and manage in-house

systems, which is why large enterprises were the early adopters. These resources are

lacking in most SMBs and this sector accounts for around 50% of the gross national

product of industrialized countries, so the opportunity for service providers is clearly

enormous. In addition, the case for outsourcing communications services is becoming

increasingly attractive to large organizations. Management may not see it as a core

competence and it is possible that IT resources could be better directed, e.g. towards

the integration of real-time communications with business processes.

In addition to a comprehensive range of converged and native IP platforms and

applications, Siemens recognizes the fact that real time communications applications

can only realize their full potential when implemented and integrated with the

knowledge and skill to fully optimize them. This is the only way that enterprises will get

the return on investment they expect. Siemens has therefore created a service offer

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that allows the company to work with clients on every stage of the technology lifecycle,

from the design, implementation, maintenance and management of these solutions. In

addition, there is a broad range of consulting and operational services designed to help

enterprises develop more effective business models, improve business systems and

processes, and even take over the day-to-day management of the communications

network.

Network operators have been able to offer baseline hosted voice service (aka Centrex)

for decades. A Centrex service eliminates the need for PBXs — the network operator

manages the phones. It was a good concept but the technology was less than ideal

when the company had several locations and it could not traverse national boundaries.

As a result, Centrex was not particularly successful in Europe.

A hosted service solution based on SURPASS Hosted Office. Recall that Siemens is agnostic

about the delivery channel. The company also provides mix & match solutions based on HiPath

systems and applications in the enterprise space and SURPASS in the service provider domain.

These constraints do not apply to IP Centrex: IP eliminates distance; any office,

anywhere in the world can be part of a unified network and be managed from a single

location. Unfortunately the term is associated with the earlier TDM connectivity service

and it does not convey the fact that IP telephony allows operators to offer a range of

value-added services.

The fact that both the CPE and hosted solutions come from the same vendor enables a

complementary mix and match of wireline and mobile functionality. For example, the

presence and availability of colleagues is displayed in the same way on different

devices. And as indicated earlier, there is no need to know whether the other party is

in the office or mobile: clicking on the relevant icon sets up the call. In addition, mobile

devices can be brought into the corporate 4-digit numbering scheme.

SURPASS Hosted Office incorporates a comprehensive array of carrier-class

applications that meet the needs of SMBs and large enterprises, particularly those

having several branch offices. IP Centrex is the core service: being IP-based allows

instant network-wide coverage, multi-tenant capabilities and on-line feature upgrades.

The solution has two key elements: the SURPASS hiQ 8000 Softswitch and the

SURPASS hiQ 4200 Application Server. The former product provides control of media

gateways, it coordinates the network intelligence presence in the various members of

the SURPASS product family and enables PSTN interworking. The latter acts as a call

feature server providing SIP-based IP Centrex functionality. The end points are SIP

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IP services in the home

Enterprises and other organizations were the early adopters of IP communications but

value-added services are also relevant for business professionals working from home

as well as regular consumers.

The Siemens portfolio has VoIP@Home solutions for both network operators and cable

companies. Cable’s premier service is TV, which indicates that access is broadband.

This allows cable companies to add telephony and other IP-centric services to their

offer. On the other side of the equation DSL technology has given local loops a

broadband capability and this allows network operators to add TV to their traditional

telephony service, which is transitioning to VoIP.

VoIP is, of course, the enabler: the offer combines the best attributes of real-time voice,

data and video. The benefit of features such as call forwarding, for example, is clearly

enhanced when a Web portal is employed and unified messaging is a more convenient

way of accessing and returning messages.

The various network elements — application servers, media gateway controllers and

end-user devices — can be deployed as needed and scaled accordingly. The

application server is the SURPASS hiQ 4200 and the SURPASS hiQ 8000 Softswitch

controls the media gateways. The key functionality of these products was given in the

section on SURPASS Open Office. This indicates the ability of Siemens’ service

platforms to deliver the services needed for business professionals as well as

consumers.

VoIP for cable companies

Triple play is the term used to describe a bundled IP service offer comprising Internet

access, email and TV, which will normally have both subscription and regular channels.

Cable companies are well placed to market themselves as major players in this

emerging voice and multimedia sector. By the end of 2005, it is estimated that 14

million subscribers will sign up for VoIP from a cable TV service provider, according to

the market research firm In-Stat. And as more cable companies invest in VoIP over the

next few years, encouraged by the success of adding voice services to their offering,

worldwide cable telephony penetration is projected to exceed 22 million by 2008.

As in other areas of telecommunications, breakneck upgrades are out and the careful

husbanding of legacy investments, with as little incremental extra capital expenditure

as possible, is in. Telcos are adding xDSL to their copper networks to offer broadband

Internet access and video-on-demand; cable TV operators are coming from the

opposite direction. They are offering voice services on top of cable modem Internet

access and multi-channel TV. This has become a mandatory move. For example, the

leading cable operators in the US are seeing minimal growth (around 2.5% p.a.) due in

part to increasing competition from satellite. In addition, they are looking for ways to

cut both capital and operational expenditures without weakening their ability to tap new

opportunities.

Providing voice services over cable networks means deploying voice over IP

technology and Siemens has a comprehensive portfolio of cable-ready components

and systems. The principle component, the SURPASS hiQ 8000 Softswitch, meets the

PacketCable 1.1 specification and the Siemens solution supports both U.S. and

European standards for delivering IP-based voice services. In addition, the products of

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best-in-class partners are employed in order to deliver a full solution that includes

support security, billing, and network management.

VoIP devices for the home

In this final section we take a brief look at Siemens’ VoIP competence with regard to

wireless/cordless devices for use in the home. Siemens has been the leading vendor of

cordless DECT handsets for many years and Gigaset is a well-known brand name.

These devices provide key system functionality and are ideal for use in the home and

small offices. Any party can pick up the call and transfer it with a message to another

party. Adding a VoIP capability is a logical development and it has been enabled as a

PC-based solution or, as shown here, as a dual-mode solution. In both cases an

analog connection is available as an option.

In this ‘always on’ hybrid solution the user

can decide whether to make an Internet or

PSTN call and both lines can be used

simultaneously.

VoIP functionality includes basic call plus a buddy list, chat, alerts and IM. There is also

a messaging capability, e.g. email, store-and-forward and notification that works in

conjunction with a service provider.

And last but not least, Siemens has developed

a range of cordless WLAN devices. The

Gigaset SL75 WLAN handset shown on the

right connects via the 802.11g air interface to

a router that in turn connects to the Internet.

The device can also

be used in hot spots

and WLAN office

environments.

The handset on the left

is a Voice and Video

over IP device. This is

a ‘proof of concept’

handset that

represents the future

of IP Communications

in the home.

Conclusions

The combined impact of the Internet and the Web on data communications was

seismic, but we take the amazing functionality for granted, which is the way great

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technology works. Now we are witnessing the impact of VoIP and related IP-centric

technologies on telephony. In a decade VoIP has transitioned from a poor quality, PC-

to-PC medium to a mainstream medium. However, it is VoIP’s role as a catalyst that is

really significant.

Brand-new communications concepts are coming to the homes and offices; new

markets are being created; but the convergence of voice and data in enterprises and

the transition to IP in public networks are complex tasks that require significant

investments backed by long-term strategies. In addition, carriers are facing competition

on new fronts, but at the same time the new markets are generating brand-new

opportunities.

Nobody has all the answers to this complex mix of issues and opportunities, but

Siemens has more than most other vendors. As the previous pages have shown, the

company’s communications portfolio is both broad and deep, and it is backed by

consultancy and management services. Systems address the needs of enterprises

and carriers; the functionality addresses our needs as business professionals and

consumers.