Packet-Switched or IP-based Systems (VoIP)
The transition from traditional systems to IP and converged systems has been the principal development in the PBX market in the current decade. IP-PBXs operate on the Local Area Network (LAN) and treat voice as a LAN application, enabling voice to be integrated with other LAN applications and allowing easy setup of voice, data and video sessions over IP networks. Integrated voice and data communications services utilizing an IP platform are usually referred to as `enterprise services.' Some IP-PBXs use softswitch trunking rather than Legacy TDM trunk lines purchased from the LEC, generating considerable savings. In addition to voice mail, IP-PBXs provide a company greeting, music when callers are put on hold, automatic call conferencing, call logging and tracking, and click-to-call, by which a user can click a record on a PC screen to initiate a call.11
The FCC noted that "enterprises are already relying heavily on IP-based applications to facilitate both internal and external communications. For example, more and more businesses are moving to VoIP solutions in lieu of PBXs and other traditional facilities to manage their communications. . . . Verizon and Nortel intend to market VoIP upgrades to Verizon's existing PBX customers and to migrate them away from existing legacy PBXs to Verizon's converged IP network."12
Like Legacy systems, IP-based MLTS is offered through a Premise-based or Hosted configuration, by the same kind or type of service providers -- equipment manufactures or local exchange carriers -- as shown in Table 1. Hosted IP systems are a relatively new service. They are suited for companies that have no main office or many mobile workers and that offer toll-free service. Hosted IP provides functionality between internal lines and mobile phones - incoming calls can be routed to wireless phones - and supports toll-free service. In effect, hosted IP provides PBX functionality as a service. Upfront costs are lower, as with Centrex, but the service menu is more limited.13
Many LECs offer Interconnected VoIP MLTS service as an information service through their non-regulated affiliates. Two examples are AT&T California's Centrex IP and Verizon California's Hosted IP Centrex. VoIP T1 business services are used primarily to provide MTLS according to comments filed by Time Warner Telecom with the FCC:
The functionalities of VoIP T1-based business services closely resemble those of circuit switched business service. For example, VoIP MLTS and circuit-switched MLTS offer similar features, such as interoffice communication, extension dialing, and enhanced voice mail capabilities. Installation and administration of both VoIP MLTS and circuit-switched MLTS require trained personnel. Trade press and industry marketing materials indicate that VoIP business services compete in the same market with circuit-switched business services, suggesting that VoIP MLTS and circuit-switched MLTS may be substitutes for one another.14
11 TIA's 2009 ICT Market Review and Forecast, Telecommunications Industry Association at 3-16, 2009.
12 FCC 04-28, para. 3.
13 TIA's 2009 ICT Market Review and Forecast, Telecommunications Industry Association at 3-16, 2009.
14 Comments in Support of Petition for Reconsideration/Clarification and/or Waiver by Comptel, WC Docket 04-36, page 5. http://fjallfoss.fcc.gov/prod/ecfs/retrieve.cgi?native_or_pdf=pdf&id_document=6518158421.
