Mobile VoIP for Business

On March 23, Skype rolled out the beta of its Skype for SIP (Session Initiation Protocol) offering, the long-awaited move that lets enterprises use their regular phones in conjunction with IP PBX systems to make desktop calls to any phone in the world at (during the beta, at least) standard Skype rates. Depending on the company's usage, this could represent a decent chunk of money saved. In some ways, Skype for SIP may legitimize VoIP for the enterprise, but what about mobile calling?

In May, the Associated Press ran an article based on new numbers from the Centres for Disease Control and Prevention showing that 20% of American homes now only use cell phones vs. only 17% that are landline-only—a shift caused at least in part by the current recession. It seems more than plausible that enterprises are also looking for ways to drop their calling costs while giving mobile phone use higher priority. The perfect melding of these trends is mobile VoIP.

We Have the Technology
Mobile VoIP primarily runs over UMA (Unlicensed Mobile Access), which lets VoIP run on top of conventional GSM cellular service, or SIP, the increasingly popular, non-proprietary standard for Internet-based voice and video calls. VoIP Wi-Fi phones are available from several manufacturers. Unfortunately, what we don't have is a cooperative infrastructure.

"Mobile portal Voice over Internet Protocol offered by third-party application-based providers is a huge and direct challenge to the $692.6 billion global mobile voice market," says Akshay Sharma, research director for carrier network infrastructure, converged infrastructure with Gartner. "In time, traditional network-based mobile carriers face the real prospect of losing a major slice of their voice traffic and revenue to new non-infrastructure players that use VoIP."

Herein lies the central problem. Traditional cellular carriers lack a revenue model under which VoIP makes sense, and budding wireless data carriers lack the infrastructure to support today's enterprises. According to Sharma, some cell phone service providers have indicated that they will continue to use CDMA (Code Division Multiple Access), one of the two wireless standards used throughout much of the world. This is problematic because conventional cellular was never meant to perform as a data network. What the carriers need is 4G technology that can remedy the quality and latency problems that continue to plague VoIP services carried over voice networks, and 4G has yet to become a commercial reality.

Meanwhile, there are service providers that offer broadband-quality WiMAX service. VoIP over WiMAX works like a champ if the user has a strong signal, but there can be sporadic gaps in the service's map coverage, enough to make in-car VoIP calling over WiMAX difficult to impossible. Wi-Fi and WiMAX don't "hand off" signals from one hotspot to the next as quickly and effectively as cellular. This will likely improve as WiMAX networks grow and evolve, but today, even while some companies sell a WiMAX-based VoIP service to home users, they are not extending that service to enterprises.

"The issue is that data demand is the primary focus… and VoIP is an additional expense with limited return," says Carl Ford, partner with Crossfire Media and a key organizer of 4G conferences. "It would be nice to see someone enable end-user VoIP and not try to be a voice service. That's probably not in the cards for today, but ultimately it has to be, because the network is the Internet."

What Will It Take?
To a limited degree, mobile VoIP has arrived already. Several VoIP providers enable mobile VoIP today, but few are marketed in the United States and fewer yet come with business-oriented features. All of these services are still trying to cope with providing a data service on a switched-circuit voice network.

The landscape will likely change radically as 4G networks get deployed, the two main technologies here are WiMAX and LTE (Long Term Evolution). WiMAX has faced a hard road to date despite constant backing by Intel, and funding for a nationwide rollout remains elusive. Meanwhile, many cellular carriers are starting to look beyond CDMA and GSM to LTE. Based on the recently finalized (although still not ratified) 3GPP Release 8 spec, LTE offers peak download rates of 326.4Mbps, peak uploads of 86.4Mbps, and round-trip packet times below 10ms. Usually, users don't perceive latencies of under 50ms in voice conversations, so LTE is primed for VoIP. Verizon expects an initial LTE rollout in 2010. AT&T should follow suit in 2011. Expect limited trials even sooner. Just don't expect overnight miracles for mobile VoIP.

"Despite the potential for a big impact on the industry, we believe the conditions for the rapid expansion in the use of mobile VoIP are not yet right and are not likely to become right for at least five years and perhaps as long as eight years," says Gartner's Sharma. "Transition to mobile portal VoIP should be fairly rapid once the basic market conditions are in place because of the convenience and end-user cost savings. In 10 years, we expect that 30% of mobile voice traffic will be carried by third parties. These third-party mobile portals, such as Google, Facebook, MySpace, and Yahoo!, will adopt wireless VoIP service as a voice option to their current communications hub."

It follows that similar, though more business-focused, portals will deliver mobile VoIP to enterprises. Feature availability will be critical. According to Sharma, a successful mobile VoIP offering for business will need to work with the enterprise's IPBX and offer full PBX-class services while roaming. "The cell phone becomes an extension of the desk phone or you don't even have a desk phone. Everyone just gets a cell phone." These mobile VoIP phones will deliver more than voice; they'll also provide unified communications, including email, IM, and collaboration. VoIP on its own has proven insufficient to displace conventional cellular service, but VoIP as a key component within a larger suite of productivity services to handsets seems unstoppable.