source: . voice over ip (voip) effects on telecom industry zahid irfan 2001-03-0037
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Source: www.blondie.com
Voice over IP Voice over IP (VoIP) (VoIP)
Effects on Effects on Telecom IndustryTelecom Industry
Zahid Irfan Zahid Irfan 2001-03-00372001-03-0037
What I am going to talk What I am going to talk aboutabout
Communication NetworksCommunication Networks InternetInternet Birth & Development of VoIPBirth & Development of VoIP Effects of VoIP on Telecom IndustryEffects of VoIP on Telecom Industry Telecom Industry’s ResponseTelecom Industry’s Response Conclusions and Conclusions and
RecommendationsRecommendations
Internet’s Birth.. 1971Internet’s Birth.. 1971
Source :http://www.cybergeography.org/atlas/historical.html
Internet’s Explosion … Internet’s Explosion … 19991999
Source :http://mappa.mundi.net/maps/maps_007/
What drives the InternetWhat drives the Internet
The Internet’s backbone.. The The Internet’s backbone.. The protocolsprotocols– Token Ring Token Ring – User Datagram Protocol (UDP)User Datagram Protocol (UDP)– Internet Control Message Protocol Internet Control Message Protocol
(ICMP)(ICMP)– Transmission Control Protocol/ Transmission Control Protocol/
Internet Protocol (TCP/IP)Internet Protocol (TCP/IP)
http://oac3.hsc.uth.tmc.edu/staff/snewton/tcp-tutorial/
Why not USE the NET… Why not USE the NET…
The motivationThe motivation– The high rates of telephone calls from The high rates of telephone calls from
Israel to USA. ($2.5/min)Israel to USA. ($2.5/min) The solutionThe solution
– Transmission of Voice signals over the Transmission of Voice signals over the netnet
Emergence of Voice over IP Emergence of Voice over IP
Voice over IPVoice over IP
Voice over IP (VoIP)– Conversion of voice signal to stream
of packets and using the Network line to transmit to destination and then reconvert it to voice signals
Data and Telephone Data and Telephone NetworkNetwork
Source : www.howstuffworks.com
VoIP NetworkVoIP Network
Source: www.technet.com
IP Network
PSTNMedia GW
Call Agent Application Servers
Source ofValue Added
Services
Signaling GW Address Re-solver
ENUM
Clients• • •
Applications of VoIPApplications of VoIP
Internet aware devicesInternet aware devices VoIP/PSTN hybrid gatewaysVoIP/PSTN hybrid gateways Interoffice trunking over corporate Interoffice trunking over corporate
intranetintranet Remote accessRemote access Voice calls from Mobile PCs and Voice calls from Mobile PCs and
mobile phonesmobile phones
BenefitsBenefits
Cost ReductionCost Reduction Simplification Simplification
– same network (easy maintenance)same network (easy maintenance)– optimization of bandwidthoptimization of bandwidth– Fault toleranceFault tolerance
Advanced ApplicationsAdvanced Applications– video conferencingvideo conferencing– white-boarding and shared screenswhite-boarding and shared screens
Quality of Service (QoS)Quality of Service (QoS)
Sharing of available capacity Sharing of available capacity Latency of transmissionLatency of transmission Authentication and Authentication and
Encryption(Secure TelephonyEncryption(Secure Telephony Reliability of TransportReliability of Transport
Growth of VoIPGrowth of VoIP
Estimates of various sourcesEstimates of various sources $500 m to $18.7b in 1999-2004 (106%
growth) -IDC $270 m to $12.6 b in 1999-2004 - Ovum 30% of international phone traffic will be
carried over data lines in 2002 against 0.2% in 2001 - Probe
$4b to $23b in 2001-2004. - Kagoor
Souce: www.fortune.com
Telecom Industry LossesTelecom Industry LossesCompany Losses
($m)%
AT&T ~350 3.6%
(KDD Co. Ltd.(Japan)
~307 10.4%
Deutsche Telekom ~175 4.2%
Telstra Corp.(Australia)
~168 9%
Embratel (Brazil) ~28 11.5%
Bezeq (Israel) ~30 10.7%
Source:http://www.it.kth.se/voip.html
Telecom Strikes BackTelecom Strikes Back
PTCL signs contract with M/s ABS PTCL signs contract with M/s ABS Corporation (min. profit $36 Corporation (min. profit $36 annually)annually)
AT&T-Yahoo consortium acquires AT&T-Yahoo consortium acquires 37% of Net2Phone shares37% of Net2Phone shares
Indian Government to lift ban on Indian Government to lift ban on VoIP in 2002VoIP in 2002
VoIP without Enhanced VoIP without Enhanced Service Provider StatusService Provider Status
Cost per minute (in
$)
Percentage of
Revenues
Percentage of
Cost
Average Rate 0.140 100% -
Access Charges (0.050) (35.75%) 45.5%
Network Operations (0.015) (10.7%) 13.6%
Depreciation (0.010) (7.1%) 9.1%
Sales, General &
Administrative(0.035) (25.0%) 31.8%
Total Cost (0.0110) (78.6%) 100.0%
Net Profit (0.030) 21.45% -
Source : Merrill Lynch Corporation
Future DevelopmentsFuture Developments
Text to voice conversionText to voice conversion Voice to text conversionVoice to text conversion Voice response systemsVoice response systems Replacement of Mobile system Replacement of Mobile system
with IP-based systemswith IP-based systems
Questions & AnswersQuestions & Answers
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