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  1. 1. Making Sense of VoIP Provided by: Abstract: Voice over Internet Protocol (VoIP) is the technology used to transmit conversations digitally over the Internet. VoIP is being adopted globally and changing the landscape of telecommunications for businesses and consumers. This presentation describes VoIP and how it compares to traditional phone systems, the standards organizations promoting the technology, and what this means for you now and in the future.
  2. 2. Introduction Simply stated, Voice over Internet Protocol, or VoIP, describes how the Internet or other packet network can be used to carry voice conversations. More and more, people are switching from traditional phone service to VoIP for their calls. For example, IDC estimates that at the end of 2004, 600,000 households were using the service and projects that number to increase to 14 million by the end of 2008. Many people describe VoIP as a disruptive technology1 for telecommunications. This paper describes what VoIP is, how it compares with the legacy phone technology, and what solutions can be devised using internet to carry voice. It also explores what government is doing to regulate this technology, how the standards organizations are organized, what businesses and other groups are trying to sell (or give away), and what this means for business and residential consumers. The Technology of VoIP Audio is converted to digital by a process called encoding. This is the “voice” part of VoIP. Once audio is encoded, it can be transported via electronic means, such as the internet. There are rules, or protocols, that have been established for exchanging information over the Internet, the basis of which is called Internet Protocol, thus the “IP” in VoIP. VoIP is becoming popular as more and more people utilize broadband technology. Broadband technology is a large capacity data connection to your home or office that is “always on”. Examples are internet service provided by cable or digital subscriber line (DSL). Internet Protocol describes, among other things, how data is broken up into packets, addressed, and transported. In this way, you can use a single network to transport many kinds of data at the same time. For example, someone can be surfing the web while another person is having a VoIP connection. It is interesting to note that many long haul phone calls are already utilizing IP today. The phone company networks utilize internet in their backbone which is used to transmit phone traffic and other data. The technology has existed and has been utilized for many years. The key difference between that use of IP for calls, and what we’re calling VoIP today, is managed –v- unmanaged IP networks. The internet that exists in the phone company network is private and managed. The phone company manages both sides of the network and everything in between. When we refer to VoIP today, we are referring 1 Wikipedia.org describes a disruptive technology as a new technological innovation, product, or service that eventually overturns the existing dominant technology in the market, despite the fact that the disruptive technology is both radically different than the leading technology and that it often initially performs worse than the leading technology according to existing measures of performance.
  3. 3. to voice traffic over a public network. The endpoints can be anywhere and the route in between can be unknown and not managed by a particular entity. Turning analog phone signals into digital packets and routing the packets to the Internet, can occur at various places along the phone call. For example, an IP phone sitting on your desk can handle the encoding. Or, as another example, a gateway box on the edge of a network such as in your home or on your service provider’s network can handle the technology for VoIP. This lends itself to a number of diverse VoIP solutions. Comparison of Packet Switching to Circuit Switching Technology Packet switching can be described as data, traveling along the internet in packets, each having the address of where it needs to go attached to the packet. A packet travels along the data network and is switched along until it is routed to where it needs to go. This is a simple view of how the Internet works. The way most of the phone calls have worked up until now, and still do to a large extent, is through circuit switching. In circuit switching, if you were to call your friend, for example, a circuit between you and your friend would be established and would stay active and dedicated to your conversation for the duration of the call. Even during pauses in your conversation, you would hold that circuit and no other traffic could utilize it until one or the other of you hung up the phone. This is expensive. One way to exhibit the expensive use of resources that occurs in circuit switching as compared to packet switching is to use an analogy to driving your car on a trip. If you were to drive from Colorado Springs to Denver, the analogy of circuit switching would be you would first have to wait to use a lane on the highway until no one else was on it. Then, you would get the entire lane of I25 dedicated to your travel and no one else can use that lane until you got off on your exit in Denver. The analogy for packet switching is how we drive to Denver – we share the routes and there is no one lane dedicated to a single car. Flavors of VoIP Two of the reasons why many flavors of VoIP have evolved is because 1) the need for interoperability with existing telephone systems, e.g. Public Switched Telephone Network (PSTN); and 2) there are many places “along the way” that analog voice can be encoded to digital packets. This section gives an overview of the major kinds of VoIP implementations. An IP phone is like a gateway that handles the encoding/decoding of voice and connects directly to the Internet. By itself, an IP phone can only act like a phone “extension”; it needs to work with a switch in order to make or receive calls. Additionally, since it only
  4. 4. speaks IP, a softswitch, such as an IP-PBX or a proxy, is necessary to interface with the PSTN. Another way that VoIP is implemented is called “bring your own broadband”. In this scenario, you already pay for a high speed internet connection from one provider, and you pay another company to supply phone service over that internet connection. Examples of companies that provide this kind of service are Vonage and BroadVoice. The VoIP supplier handles routing calls to/from you and interfaces with PSTN if it needs to in order to complete the call. While the “bring your own broadband” companies have the majority of the commercial VoIP market at the moment, their share is expected to erode away quickly as more and more Internet service suppliers, such as cable companies, begin to provide VoIP service. In this case, you get an adaptor, i.e. a gateway, that sits on your cable modem and handles the telephony. In many cases, you can then take that adaptor with you, hook it to a high speed Internet service, and get your calls routed to where you are. One way that calls can be made for free is by supplying your own internet service and downloading one of the free software packages that exist for VoIP. When you download the software to your computer, you are then able to call others who are using the same software and connected to the Internet. This is often called the “away at college” solution, where parents and college students can load up the software and call each other. Examples of software that do this is Skype and Free World Dialup. Skype also provides pay-per-minute calls when you dial someone who is not a Skype user. Many of the services that involve telephony are moving towards Internet solutions. For example, IP solutions are being implemented for call centers and conferencing services. Additionally, features such as video conferencing and voicemail are being implemented over IP using equipment on the service provider side. This is called IP Centrex. Equipment that sits on the customer premise and provides services such as extension dialing and voice-mail are called IP PBX’s A Glimpse at What’s Possible The maturing of VoIP technology is allowing for new possibilities in terms of economics and technology. For example, even today, someone in Japan can call anywhere in the world for 2.5 cents per minute over a service such as Yahoo!BB. Many residential and business customers subscribe to two different networks – one for their phone service and one for their data network. The technology exists to have a single network – the Internet – carry both their data and phone calls and people are starting to take advantage of this and save money. In a 2005 interview, Hossein Eslambolchi, AT&T’s CTO, stated it’s not a matter of if VoIP will eventually replace TDM for all calls, it’s a matter of when. He predicts that could happen in one to two decades.
  5. 5. The telephony features that we know of today, such as follow-me or conference calling services – have been implemented in VoIP. What companies and entrepreneurs are now looking at are the new features, or the “killer applications”, that can drive new markets and differentiate themselves from other VoIP or phone service providers. Where are companies looking to provide new voice applications? One area is integration of email and voice mail. Imagine having one point where you can access your voice mail of your business phone, your cell phone, and your home as well as viewing your email. Another area is presence and instant messaging. Presence refers to the availability of someone on a device. For example, if I am at my PC and wish to receive instant messages (IM), I can turn my status to “available” on my IM client. Friends now know I am accepting instant messages. By devising intelligent instant messaging and presence applications, people can let it be known on which device, e.g. cell phone, office phone, PDA, voicemail, that they are accepting messages. Or, one can configure that a call only comes through if it is from a particular person, such as your boss when you are in a meeting. Then there are the possible applications available when pairing wireless and VoIP. Imagine being in an unfamiliar town and having your cell phone or PDA notify you when you are within five blocks of a Starbucks, maybe even sending you a coupon or telling you how long the wait is. There can be negatives to the advancement of this technology. SPIT stands for spam over Internet. Imagine having 100 voice mail spams in your inbox. These are possible scenarios. Current Players in VoIP Consumers – Business and Residential Residential consumers can benefit by the packaged plans that companies are offering. Typical rates for unlimited local and long distance, including features, are from $20 to $40 per month, not including the internet service. People who use computer-to-computer VoIP services, such as Skype, can make calls to other Skype customers for free and pay a per-minute charge to people who don’t have the software downloaded. The disadvantages of VoIP include E-911 service is not available or guaranteed, no service during a power loss, and voice quality may be akin to cellular phone quality. Regulatory Agencies with VoIP Up until now, the Federal Communications Commission, FCC, is attempting to strike a balance of growth and regulation. From their website, on January 05, 2005:
  6. 6. The Federal Communications Commission (FCC) has worked to create an environment promoting competition and innovation to benefit consumers. Historically, the FCC has not regulated the Internet or the services provided over it. On February 12, 2004, the FCC found that an entirely Internet-based VoIP service was an unregulated information service. On the same day, the FCC began a broader proceeding to examine what its' role should be in this new environment of increased consumer choice and what it can best do to meet its role of safeguarding the public interest. In November in a case involving the state of Minnesota, the Federal Communications Commission declared that the service offered by Vonage, and other similar Internet telephony services, were not subject to state regulations that affect telephony services. This ruling made it clear that the FCC, not state commissions, “has the responsibility and obligation to decide whether certain regulations apply to IP-enabled services.” The FCC has created an Internet Policy Working Group to address telecommunication issues that arise from Internet telephony. One of these issues is CALEA and E-911 Service. CALEA stands for Communications Assistance for Law Enforcement Agencies. It basically regulates how the technology needs to provide certain accesses for federal agencies, such as for wire-tapping. E-911 is the dialing of 911 from any phone and having it go through to an emergency handling facility, not currently supported on many VoIP implementations. Private Enterprise Companies that offer VoIP services fall into 3 categories – cable companies, phone companies, and alternative VoIP providers (e.g. the “bring your own broadband” solutions). Although the alternative providers, such as Vonage, were first to market and have the majority of the residential market, their share is expected to erode as the other players come on board. For example, at the end of 2003, Vonage or similar kinds of companies had nearly 66% of the residential VoIP market and the Yankee Group predicts that by the end of 2005 that they will only hold 19% of the market, while cable companies will have 56% and traditional phone companies will have 25%. Among the VoIP service providers, quality of service (QoS) will be an important way that businesses will distinguish themselves from all the other options that exist. This is especially true for companies going after the business-place market share. QoS includes services like traffic management and security. Besides VoIP service providers, other companies that are positioning themselves in this industry include hardware and chip makers such as Avaya, Nortel, Cisco, and Intel. Network providers, such as Level3, are banking on the technology to increase their network usage and revenue. There are also softswitch vendors and application developers that are writing software to enhance the features and usability of the technology.
  7. 7. Protocols and Standards Groups There are many standards organizations dealing with aspects of telephony, the Internet, and VoIP. This paper mentions a few and summarizes their responsibility. The International Telecommunications Union (ITU), a charter organization of the United Nations, is the international standards body and parent of ITU-T which stands for International Telecommunications Union, Telecommunications Standardization Sector. The ITU-T’s mission is to ensure efficient and high quality production of quality recommendations for all fields of telecommunications. Loosely under the Internet Society’s umbrella is the Internet Engineering Task Force, IETF, is the standards body for Internet protocols and services. Some of the working groups related to VoIP are organized as follows: • SIP– Session Initiation Protocol is a text based, peer-to-peer protocol. • SIGTRAN – The SIGnaling TRANsport group’s primary purpose is to address the transport of packet-based PSTN signaling over IP. • ENUM – Protocol for translating ordinary telephone numbers into IP addressing schemes. • MEGACO/H.248 – The Media Gateway Control protocol describes a control and signaling protocol for VoIP. Conclusion High speed internet connections to businesses and residences have made it possible to use the bandwidth for voice communications along with the other kinds of data. VoIP is beyond the early adoption phase and can be described as being in the initial growth phase. With VoIP, many different add-on applications are possible and it will be interesting to see where this leads voice communications from where we now know it. Reference Sources Federal Communications Commission website on VoIP at www.fcc.gov/voip www.itfacts.biz www.voip-info.org www.ietf.org Newton’s Telecom Dictionary, Harry Newton, 2000 Von Dictionary of IP Communications, Richard Grigonis, 2004 Rocky Mountain News, January 03, 2005, “VoIP Ventures Forth”