The Future of IP networks

The prophecy of Internet protocol (IP) being the universal carrier for all communication traffic is coming true. IP is the bedrock of the Internet, providing the foundation necessary for companies to become technological innovators. IP networks are developing rapidly across the Asia Pacific region due to a number of factors, including cost efficiencies, marked improvements in traffic control, quality of service and deregulation.

The most effective companies doing business in the Internet economy are applying Internet Protocol not only as a catalyst for technology innovation, but also as a platform to develop unique business models and competitive strengths. Because of the Internet, IP is everywhere. The ubiquity of IP and the evolution of the Internet have enabled scores of companies worldwide to capitalise on new market opportunities, generate new services, and develop a broader customer base.

As technology progresses, IP will unite the wired and wireless worlds. With IP networks, it will not matter if you have a wired connection or are communicating wirelessly, IP will be the common protocol of choice to deliver services and applications to every person on the street. With the advent of more and more IP-enabled devices, IP is becoming increasingly pervasive. As it becomes more integrated with people’s lifestyles, it becomes a basic need.

Voice over Internet Protocol (VoIP) made global headline news in 2004. It is clear that this technology is moving from an experimental stage to mainstream business. If one is to go by what market analysts predict, VoIP is growing rapidly as an increasing number of companies worldwide, develop roadmaps for VoIP implementation. The Asia Pacific (APAC) market also reflects this trend with Internet Protocol (IP)-based services such as VoIP driving growth in the region.

Therefore the big question is, with the rest of the world betting big on VoIP, can India be left far behind? Market research suggests VoIP is gaining momentum, with India expected to be the second largest VoIP market in APAC after China. IDC estimates revenues from VoIP services in India will touch USD 2.8 billion by the end of 2005.

India is expected to show the fastest adoption of IP applications for the next seven years, having a CAGR of 52.3 percent. The Indian industry has to look beyond just domestic rivals, as competition now comes from best-in-breed global companies. Many Indian companies, in fact, are looking beyond the border to make a mark in the global market place. To succeed, however, they need to at the least, bring their IT infrastructure on par with their global counterparts.

In today’s information empowered world, communications have emerged as a core business function and the effectiveness of a company’s communication system can greatly impact its bottom line. As businesses go global, voice based communications takes on a critical role. This market pressure has led to an interesting development over the last decade’– the evolution of IP-based voice communications. The concept of “packetising” voice – breaking voice into data packets for transport offers compelling efficiencies. Corporate users also are turning to VoIP as a means of simplifying their networks; reducing call and operational costs; and setting the stage for new productivity-enhancing communications services.

An immediate opportunity in the enterprise space is to deploy VoIP systems at Greenfield sites, to connect small locations where a PBX is not justified, to replace old PBXs, and to augment an existing system that has run out of capacity. Now that enterprises are beginning to understand the value of IP, they are pushing carriers to provide IP telephony services.

In the IT/ IT enabled services space, leading firms are evolving the traditional call-centre to develop more versatile contact centres with additional capabilities based on IP networks. IP telephony is the fastest growing technology in the contact center market. Over the next two years, more customers will invest in IP telephony for their contact centers. Meanwhile, many call center technology firms are pushing IP as the foundation of ‘next generation’ customer contact.

Although telecommunications is still a regulated business in Asian countries, governments see the need for deregulation and increased competition to promote growth. As more cities are networked, IP will be the prevalent protocol of choice for Internetworking. With the growing force of IP networks in Asia, carriers across the globe will continue to look to the region for success stories in business models and service creation. Demand for VoIP solutions in this region will only increase as service providers seek various ways to increase revenues, create differentiated services and reduce costs. The migration to IP-based networks is inevitable and Asia will undoubtedly have one of the largest and most successful systems in the world.

The emergence of standards (for example SIP) in the deployment of IPT applications will most likely streamline the standards-based development resulting in increased adoption rates. Since the penetration of IPT applications in India is just about 3.1 percent, the future looks very promising.

IP-based solutions will enable companies to deploy key services such as video conferencing, collaboration and other value-added options such as directory integration, XML integration, calling party name and number, calls received, missed calls and dialed calls, extension mobility etc. We have benefited greatly from being the pioneers of this technology in India and globally. Today, Cisco’s IP communications systems are helping more than 14,000 organizations globally; realise the potential to reduce costs and increase productivity and business flexibility. Now, our customers in India are able to realise the benefits delivered by a converged communications infrastructure. The most significant benefit of IPT and driver of its evolution is money-saving and easy implementation of innovative services.

There is a bright future ahead for the Indian economy and VOIP is taking a front seat in pushing new communication technologies across the region. Consumers and businesses are on the verge of truly realising how ubiquitous, convenient, and flexible their communications can be.

Cisco uses IP not only to constantly evolve its business and adapt to the ever-changing marketplace, but also to help its customers do the same by developing a platform for progress. India has some catching up to do when it comes to connectivity. It is critical to the nation’s ability to advance in business, health care and education. Policy-makers must therefore be forward-thinking when it comes to fostering new technologies. Whilst the Govt. has done a lot of forward thinking in the area of mobile services and telecom, we urge them to look more changes in the areas of VOIP also.

Economic growth hinges on support for virtual technology and if India rises to the challenge as a nation, it can drive dynamic changes in productivity and stay competitive in an increasingly global marketplace.