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Benefits and Risks of SIP Services: What Every Channel Partner Should Know

June 10, 2013 - Article

Suzanne RosatoBy Suzanne Rosato

There is an increasing trend toward enterprise clients adopting Session Initiated Protocol (SIP) services. It is likely that by the end of this year, SIP will be the most commonly deployed trunking service behind T1s. Most of the discussion in the telecom industry surrounding SIP trunking has been focused around the benefits SIP offers for enterprises. While most are focused on SIP’s potential to save organizations money, SIP services also offer enterprises a number of benefits including convergence, ease of administration, enhanced end-user functionality (voice, video, presence and messaging) and integration with IP networks. So if you’ve been asked recently if SIP trunking is right for a company, it’s important to review the company’s infrastructure and analyze their needs and objectives before making the decision. To help you decide, here are further details on the benefits and risks companies may encounter if they use SIP trunking.


If an organization has smaller satellite offices, there is potential to access a central PBX and eliminate the need for PBX switches in those smaller offices. If the client conceptually understands that SIP calling is “free" inside of the “cloud," then the company can begin to understand how a central PBX might be shared with remote locations in an economical fashion. In addition to simplifying management and administration, this scenario provides for a homogenous end-user experience relative to features and functionality. There may also be savings associated with the SIP edge device as compared to traditional TDM trunk cards in the PBX. This is because the SIP edge device can support more simultaneous conversations.

Voice Usage Costs

When a call can be completed without accessing the PSTN, it does not incur usage costs. However, it is important to remember that if your customer is using VoIP, the potential for additional savings decreases with a migration to SIP. The exception to the rule is in cases where another SIP client with similar hardware enables the calls to be completed without accessing the PSTN. Most managed SIP services include unlimited local calling and some bundle of minutes for a monthly recurring fee. There usually is no distinction between intrastate and interstate minutes. Nevertheless, international and other types of calls (i.e., Directory Assistance), are charged at separate “SIP rates," which may be more expensive than negotiated TDM rates for similar types of calls.

Shorter haul calls may be an additional source of savings if the ITSP has an egress point close enough to the receiving party. In this case, a call is local once it transfers onto the PSTN, given that a number of SIP offerings include unlimited voice usage. This is called “local breakout" and can be applied in a scenario where a call from the U.S. travels via the SIP cloud to a SIP terminating point in an international country. When the call completes via the public network in the foreign country, it appears to be an intra-country call and usage will be rated on that basis.

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