False promises damage VoIP reputation

Consumer VoIP providers selling services as enterprise/SME solutions are potentially damaging the VoIP industry's reputation and setting an unreasonably low benchmark for pricing. While rates such as 10c untimed anywhere in Australia offer an attractive proposition to anyone making STD calls, customers are bound to be turned off by the technology if they don't receive the service they expected.

VoIP (voice over internet protocol) is an acronym that the ICT industry has become all too familiar with. While the consumer market is dominated by free and low-revenue options such as Skype and many large enterprises have adopted business-grade VoIP solutions, SMEs are the next key target for VoIP providers.

The latest research by analyst firm Frost & Sullivan states that Australian enterprises considering VoIP are dissatisfied and bewildered by the VoIP solutions currently on the market. It doesn't help that Australia is currently flooded by a plethora of service providers who deliver an extensive range of services, further mystifying SMEs that are considering the switch to VoIP.

The reality is that not all VoIP services are the same. There needs to be a differentiation between consumer-focused VoIP offerings and business-grade VoIP solutions both in terms of service quality and pricing.

According to Gavin McDougal, managing director at business-grade VoIP provider ISPhone, many VoIP providers are marketing their consumer offerings as fully-fledged SME services. He argues that this could inflict long-lasting damage to the VoIP industry and ruin its reputation as a business application.

"Many residential VoIP providers claim that their solution can be used for business, but their services run entirely over the public internet and use residential grade equipment at the customer's premises. This means that they can't deliver the call quality that is essential for a professional environment."

While the industry is looking into ways to categorise the VoIP services available on the market, emerging technologies like voice on Wi-Fi (VoFi) and voice over WiMAX will make distinguishing the types of VoIP services available an extra challenge. However, for SMEs who don't have the resources available to sit down and decipher VoIP's jargon and complexities, it's an important task.

"At this stage in the evolution of VoIP it is essential to differentiate the services on offer. The reputation of VoIP depends on the customer's experience with the technology. It is the VoIP provider's responsibility to ensure that everyone understands how to select the service that works best for them," McDougal said.

Shara Evans, CEO of Market Clarity, said: "Many consumers and SMEs do not have the technical savvy or market awareness to actually know the difference between a fixed PSTN service, a private network-based VoIP service or a public internet-based VoIP service."

"Many VoIP providers are also unclear about what consumers or SMEs are signing up for, and there is often no phone number or address for follow-up contact after people have signed up for a service. For example, Market Clarity has tried to contact every VoIP provider we identify on the Aussie VoIP List (225 as of early November), and some don't even answer their own telephones!"

In the ever changing VoIP service provider landscape, too many providers do not describe the network their potential clients will be using.

"There's a world of difference between VoIP services deployed across private network infrastructure as opposed to the public internet. The public internet is a network of networks managed by thousands of individual network owners. Because no single service provider has end-to-end control over the many links that comprise the public internet, service quality for real-time applications such as voice can't be guaranteed.

"Nor can VoIP providers guarantee that an internet access link will always be available, as there may be periodic service interruptions.

"It's a mistake to think that the service from a public internet-based VoIP provider can offer the same quality and reliability as a fixed PSTN service, or a private network-based VoIP service."

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