"Off to See the Wizard"

“Off to See the Wizard”VoIP – The Search for Courage

Timothy SalapekTekelec

04/12/23

’05 | 2Tekelec Confidential

Off to See the WizardFollow the Yellow Brick Road!Off to See the WizardFollow the Yellow Brick Road!

Agenda

• Market Perspectives History Current Climate Today's VoIP Business Incentives

• Considerations Regulations Continuity and Feature Parity Quality of Service

• Service Opportunities Residential Business Enhanced

• Network Tour Deployment Options

04/12/23


A Ten Year History of VoIP

TheEnterprise

TheEnterprise

Mass MarketVoice

Mass MarketVoice

Long-haul and International Trunk Reduction(PSTN Bypass)

PBX Replacement

Business Services

Residential ApplicationsAnd Services

PSTN• Dedicated• Well Managed• Labor Intensive


SONET (FR/ATM/MPLS/IP)• Dedicated• Well Managed• Bandwidth Intensive• Costly

SONET (FR/ATM/MPLS/IP)• Dedicated• Well Managed• Bandwidth Intensive• Costly

Public Internet• Unreliable• No QOS


Managed IP Networks• Semi-Dedicated• Well Managed• Bandwidth On Demand• Cost Effective

Managed IP Networks• Semi-Dedicated• Well Managed• Bandwidth On Demand• Cost Effective

TrunkingTrunking

““Computers will never be more than just toys”Computers will never be more than just toys”““Computers will never be more than just toys”Computers will never be more than just toys”

“ “ The Internet is just a passing Fad!”The Internet is just a passing Fad!”“ “ The Internet is just a passing Fad!”The Internet is just a passing Fad!”

“ “ No one will ever buy bottled water”No one will ever buy bottled water”“ “ No one will ever buy bottled water”No one will ever buy bottled water”

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VoIP; It’s Been Called…

• “The end game”

• “A platform for innovation”

• “A driver of broadband deployment”

• “An enabler of economic growth”

• “Technology with unlimited potential”

• “The next killer app”

• “Our future” VoIP

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Why VoIP?

• Lower cost?

• Higher quality?

• Easier to manage?

• Faster delivery?

Voice over IP has emerged as a major reason for declining spending across local, data and long distance spending. A sizeable number of businesses are currently using VoIP and several of them have also reported considerable savings [25%] usingVoIP

Source: Morgan Stanley Telecommunications Services Survey



SONET (ATM)• Dedicated• Well Managed• Bandwidth Intensive

SONET (ATM)• Dedicated• Well Managed• Bandwidth Intensive



Managed IP Networks• Semi-Dedicated• Well Managed• Bandwidth On Demand

Managed IP Networks• Semi-Dedicated• Well Managed• Bandwidth On Demand

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Public Switched vs VoIP

PSTN VoIP

Highly Reliable and Available Interoperability (Sometimes)

Slow to add features Aggressive to add features

Mature Quality of Service Evolving Quality of Service

Mature Vendor Proprietary Young Firms Open Platforms

Defined Market Focused Growth Market

Smart Inside Smart Outside

Expensive Infrastructure Costs still unclear

Billing is well understood Flat Rate (for now?)

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Advanced Features CLASS, Business Features, Unified Messaging, Conferencing, Web

Portals, Mobility

New Revenues Centrex, Key Systems, PBX, and residential Value Add to existing services

Seamless Transition Inter-works with any platform

Legacy TDM Next Generation IP/SIP

Scalability Start Small and Grow 50 seats to 30,000+ seats

Why VoIP?

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VoIP Business Incentives

• The Defensive Response Prompted by emergence of high profile VoIP service

providers Maintain or replace business "Fighting fire with fire"

• Issues Addressed Loss of residential second line customers

Erosion of residential base

Migration of residential and business users to "next generation" providers

04/12/23


VoIP Market Segment

• Incumbents / IXCs pursuing residential VoIP Vonage Reaches 400,000 lines (2/05) Qwest Residential VoIP introduced (12/03) AT&T CallVantage introduced (3/04) Verizon Residential VoIP announced (11/03)

• MSOs have already introduced VoIP in trials or production Charter Communications introduced (9/02) Time Warner Cable introduced (5/03) Cablevision Systems introduced (9/03) Cox Communications introduced (12/03)

• Others leading with hosted business services SBC Business HIPCS introduced (11/03) BellSouth Centrex IP introduced (5/04) MCI Advantage expansion to hosted PBX announced (3/04)

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VoIP’s Explosive GrowthServices & Revenue

0

200

400

600

800

1,000

1,200

1,400

1,600

2002 2003 2004 2005 2006 2007

By 2007, residential By 2007, residential broadband telephony broadband telephony servicesservices are projected are projected to generate about $1.4 to generate about $1.4 billion in revenuesbillion in revenues

Frost and Sullivan, 2004Frost and Sullivan, 2004

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Residential VoIP & Broadband

0.00%

5.00%

10.00%

15.00%

20.00%

25.00%

30.00%

2004 2005 2006 2007 2008Source: Vonage/VoIP Business Weekly

VoIP Penetration of U.S. Broadband Accounts

–Broadband access and VoIP Broadband access and VoIP penetration growing penetration growing simultaneously.simultaneously.–Opportunity for BYOBB Opportunity for BYOBB providersproviders–Competition for access Competition for access providersproviders

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VoIP Business Incentives

• The Attack / Growth Approach VoIP can also help realize the objectives of growth-oriented carriers "Fighting fire with water"

• Benefits Attract new customers - by offering integrated IP services at reduced cost

Convert UNE-P subscribers to VoIP

Expand into new geographic markets - with cost-effective converged next-generation networks

Increase ROI - by leveraging existing broadband infrastructure to deliver voice services

Grow revenues - from existing business and residential customers with enhanced applications

Retain customers - by offering bundled voice, data and Internet services

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Agenda

• Market Perspectives History Current Climate Today's VoIP Business Incentives




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Regulations

• What is the definition of a VoIP service provider Telco or an enhanced service provider

• How should they be regulated - or don't regulate them Regulators are reluctant to hamper competition Incentives encouraging VoIP development now

• How will this change Who will take over and when Leverage the market now Build flexibility for the future

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Quality of Service

• A perception is VoIP offers lower quality From the early experiences of uncontrolled services No QoS features on the VoIP network Can't control the last mile network performance

• If service is cheaper can the quality be less Voice quality in the cellular network is changing user expectations But uncontrolled services are the ultimate commodity... many now free

• Carrier grade, high quality solutions are now practical NG switching, signaling, applications systems designed with ground-up

support for VoIP VoIP aware data networks are easy to build, but require engineering, and

end to end participation

The right technology and engineering is key to a Carrier Grade VoIP network.

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Agenda

• Market Perspectives History Current Climate Todays VoIP Business Incentives




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Where to Get Started

Residential Residential "Basic" Residential "Plus"

Business Centrex Replacement PBX Alternative Premium VoIP Services

Good News You may not have to "decide"

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Residential VoIP Services

• Residential Basic Parity with existing CLASS and Custom calling first-line residential service

offering Offer the same for less by "eliminating" access costs, bundling for flat-rates

• Residential Plus Take advantage of always-on Internet connection Add desktop web portal application

Call Logs Click-to-Dial Internet Caller-ID / Pop-up Console Real-time Call Management Find me / One number Personalized voicemail and hold announcements Subscriber Self Service

Offer more for the same (or more!)

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Web Portal Functions

• Call Logs / Click to Dial

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• Internet Caller ID / Real-time Call Management

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• Find Me / One Number

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Business VoIP Services

• Centrex Replacement Parity with traditional switch-based analog / digital centrex or basic key systems Can use multi-line gateways for CPE, as with residential service Expand / reduce feature set to create additional tiers or premiums

• PBX Alternative Includes the entire complement of features available at a business set with a

traditional PBX and more Uses display-capable IP phone for CPE Can also use multiline gateways or IADs for extension lines Provide these services to TDM subscribers through integration of IP-enabled Class 5

• Call Center Call center functionality for groups of agents Integrated within the Application Server Provides increased revenue with enhanced services Distributed Agents

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Business Product Positioning

• “Local Line” for business Area codes can be chosen for targeted customer locales Customers can call your business as if you were “in” their area with no long

distance charges Call branch offices, business associates, as if you were in their area with no

long distance charges

• TeleWorker or Work from Home Offer business customers a TeleWorker package Business phone extension – same number, features as if in the office Bundle with broadband Could be business sponsored and paid for business/gov’t

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Basic Service Continuation

• Compatible with services in your network Ability to service POTS phones and subscribers in place Customers existing expectations for CLASS features and services

• New technology must fit transparently in your network CALEA / Lawful Intercept Emergency Services / 911 Operator Services / Directory Assistance

Continuation of your basic network services is critical to your business. The VoIP must fit transparently in your network.

04/12/23


Agenda

• Market Perspectives History Current Climate Todays VoIP Business Incentives




Off to See the WizardFollow the Yellow Brick Road!

Off to See the WizardFollow the Yellow Brick Road!

04/12/23


Reliable Redundant components

All call processing events mirrored in real time

Distributed architecture Operates on NEBS compliant operating system (Sun Solaris)

Scalable Larger servers or multiple server pairs

High Performance 200 calls per second (cps) per server pair

Unlimited Partitions to be able to support deployment to large customer base Each partition provides customer specific features, number plans, applications, etc.

Standards Based SIP, MGCP, SNMP, CORBA, IMAP, SMTP, SOAP, LDAP, SMPP, XML, HTML

VoIP Architecture

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POTSPOTS xDSL & FTTxxDSL & FTTx CableCable Fixed WirelessFixed Wireless MobileMobile

Integrated Multimedia ApplicationsIntegrated Multimedia Applications

Next GenerationNext GenerationSwitchingSwitching

Next GenerationNext GenerationSwitchingSwitching

SignalingApplications

System


System


System


System

WirelineWirelineNetworksNetworksWirelineWirelineNetworksNetworks

PacketPacketNetworkNetworkPacketPacket

NetworkNetwork

• Call control• Media interworking• Media processing

• Call control• Media interworking• Media processing

SS7

IP

SS7

IP

SS7

IP

SS7

IP

SS7

IP

SS7

IP

SS7

IP

SS7

IP

The Architecture for VoIP

WirelessWirelessNetworksNetworksWirelessWirelessNetworksNetworks

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VoIP Architecture

MDU - Multi-Dwelling Units

AnalogUsers

IP Phone Users

Home; Telecommuter

Analog Phone

Data FW

Router/IAD

Cable / Fiber /DSL

Office/Branch Office

IAD

Cable / Fiber /DSL T1

Modem

Application ServersCall Agents Database

Agent

Session BorderController

Gateway(SIP to PRI, e.g. Cisco 5350)

IntegratedNext Generation Solution

Public InternetPublic

Internet

IP –Soft Phone

Router SW/FW

PBX/KSU

IAD

IP PhonesLegacyPhones

Road Warrior

• Single Investment

• Supports multiple access technologies Including "off-net" subscribers connected via

public Internet / peering

• Applicable to residential and business

• Integrate enhanced services and Applications

Web Portal / IP Centrex / Unified Messaging

• Single Investment

• Supports multiple access technologies Including "off-net" subscribers connected via

public Internet / peering

• Applicable to residential and business

• Integrate enhanced services and Applications

Web Portal / IP Centrex / Unified Messaging

PSTN

LegacyLegacySwitchSwitch

IP NetworkIP Network

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VoIP Architecture

ISU

P

PSTNPSTNSTPSTP

IP-Centrex

MGCP

H.248

SIP

rb 08/04

FE (10/100BT)

Broadband

POTS

E911

CALEA

GR-303

CAS

PRI

IMT

Advanced VoIP Feature Delivery Find-Me / Follow-Me Web Portal Visual Voice Mail / Unified Messaging and More!

Robust, Flexible, and Scalable Solution for Packet and TDM based Telephony

A-LinkConsolidation

T7500T7500

FE (10/100BT)

SIP, SCCP, MGCP, H.248 Integrated

IP Feature Server

POTS

Integrated

IPVoIP

Managed IPNetworkManaged IPNetwork

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Application Server Platforms

• Call Agent Servers: Controls & Routes Voice Signaling and provides PBX-like call processing

and voice mail features. NEBS Compliant servers are supported and available for an additional fee.

• Database Agent Server/E-mail/Web Serves as a single point of contact for accessing the Database which is

stored on this server. E-mail - Storage of voice mail in an IMAP email format. Service providers

may choose either Sun (Netscape) Messaging, or Stalker as the message Store.

Web Server - Graphical User Interface for end-user, enterprise administrator and service provider provisioning.

NEBS Compliant servers are supported and available for an additional fee.

• Conferencing Ability to have a single conference call with up to 100 participants. Ad Hoc

(On-demand) and Meet-Me Conference functionality are supported and available for an additional fee (optional functionality).

NEBS Compliant

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Application Server Platforms

• Session Border Controller (V-SBC): Provides protection from the Public Network for Tekelec 6000 devices and

provides a multiple protocol interface for CPE Endpoints to access the Call Agent Servers. The V-SBC also is configured for short circuiting to allow RTP streams to stay at the CPE location thereby reducing the amount of bandwidth needed for the call. Supports short circuiting for NAT, PAT and even sites with no Data Firewall.

NEBS Compliant

• Streaming Media Server/DTMF Proxy Provides media streaming for playing & recording of announcements, voice

mail and music-on-hold. When Subscribe/Notify is not configured for a SIP device or cannot support

RFC2833, the DTMF Proxy can be configured to “listen” in on SIP transmissions and then generate the DTMF to the Call Agent for call routing.

NEBS Compliant

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Applications

• Enables three types of services with associated applications:

Business IP Centrex/Hosted PBX Conferencing (On Demand and Meet-Me, optional feature) Voice Mail/Unified Messaging Web Portals Session Border Controller / NAT Traversal Optional Functionality

Front Desk and/or Auto Attendant Informal Call Center (Hunt Groups and ACD) Mobility Applications

PBX Trunking Integrated access service for customers with existing PBX or Key System

Residential VoIP Services Voice Mail Conferencing Web Portal Session Border Controller / NAT Traversal CLASS feature set

04/12/23


Session Border Traversal

In-network solution – no reconfiguration,

no truck rolls

IntegrationIntegrated voicemail, conferencing – faster

development

ApplicationsDesktop Integration,

Mobility, Productivity & Business Apps built on a PBX feature set base

Open Platform/InteroperabilityIP phones & IADs - SCCP, MGCP, SIP, APIs, trunking gateways, softswitches

Business Success Portfolio

Expertise, tools and services to accelerate

service provider time-to-revenue

AdministrationBrowser-based, wizard-

driven, PartitioningPlug and play

ReliabilityDesigned for 99.999%

with REDUNDANCY

Scalability and

PerformanceUp to 100,000 users

and 200 calls per second

Customer Service

Experienced team dedicated to respond to

all customer needs

VoIP Today

04/12/23


Future of VoIP

Offers more than POTS equivalency

Access/Transport becomes a commodity

Voice becomes basis for packet-enabled/centric apps

Voice becomes the content for applications such as PTT, Voice recognition, IM, UM

Brings solid revenue-generating opportunities

Achieves home stereo quality

Signaling plays a vital role in IP networks and delivering VoIP services

04/12/23


Timothy Salapek919-349-7909

[email protected]

Thank You!

"Off to See the Wizard"

Documents

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