Research Indicates Call Cost Reduction is Main Driver For IP Telephony

A survey of 160 IT and telecoms decision makers from top UK companies, conducted by the SAS Group, an international provider of IP-based network and communication infrastructure services, has found that the main reason for businesses to implement IP telephony (IPT) is to save money on call costs, with 39 percent of respondents indicating that this was their primary driver. When asked the same question a year earlier, 60 percent of respondents cited upgrading and replacing the existing network as the main reason.

Whilst the results indicate that the decision of whether or not to implement IPT is now being driven from a financial, rather than an IT perspective, the SAS Group is warning organisations of the importance of properly assessing the full scope of such an installation prior to embarking on a project. Establishing a business case is crucial and call cost reductions alone do not constitute one.

In reality, traditional call costs are decreasing at a rate of approximately 20 percent a year, so it is unlikely that any savings would be significant, and would certainly not contribute much to ROI. To truly realise the financial benefits of IPT, firms must capitalise on its full potential, including enabling unified communications and allowing employees to access all email, voicemail, video, fax and SMS messages through a single inbox over a unified infrastructure.

“The results suggest that businesses are still falling into the trap of believing all the vendor hype about dramatic reductions in call costs, but if you actually investigate these claims, they amount to very little,” said Charles Davis, CEO of the SAS Group. “Whilst many organisations do see some financial advantage from their IPT systems, this is usually in the form of a reduction in IT support costs, or improved staff productivity. What’s more, these installations are expensive and achieving an ROI is unlikely to happen overnight; it can take up to four years before the initial investment starts paying for itself. If call cost reduction is your only driver, then maybe IPT is not right for your business.”