Pay for Your New Business Phone System with a Cisco SIP Trunk Upgrade

By Rolf Versluis

There is a interesting new technology that is used to bring phone calls into a business phone system that provides lower monthly costs and a higher level of reliability. It is named a Cisco SIP trunk, and it is worth evaluating ways it can benefit your organization. The one thing you need to know is that your business has to be using a VoIP telephone system in order to take advantage of all the benefits, however, in some cases the monthly cost savings from changing over to a Cisco SIP trunk with a Cisco VoIP telephone system can pay for all of the costs to upgrade to a Voice over IP telephone system!

Most businesses that have more than sixty phone users have a type of business phone system called a Private Branch eXchange, or PBX. This system allows users to call each other quickly, and to share the circuits that are provided by the phone company for outside calls. The circuit that connects the organization to the telephone company is most often a type of voice T1 called an ISDN PRI, which can have 23 concurrent calls on it, and costs typically $600/month. A T1 can also be used for other reasons, including providing data connections in the form of Internet or a private Wide Area Network such as MPLS. Because all business locations require voice service as well as data service, most typically have multiple T1 connections coming into each of their sites. A Cisco phone system can work with traditional voice T1´s as well as a SIP trunk, making the changeover very straightforward.

One of the big benefits of SIP trunking is cost savings. For example, a business that has 10 locations, each with a voice T1 and an Internet data T1, can reduce their costs significantly. An Internet T1 is about $600/month, whereas an MPLS T1 costs less at about $450/month. It is possible to reduce a $12,000/month voice and data circuit cost to about $7000/month by putting in place SIP trunking and an MPLS wide area network instead of voice T1´s and Internet T1´s. This gives $5000 extra per month that can be used to pay for the purchase of equipment and installation services for a VoIP phone system. If the telephone system is financed over a 3 year period, that provides a total budget of about $180,000 for a new phone system.

There are also cost savings from circuit consolidation. SIP trunking is often used to consolidate unused circuit channels from the telephone company. With traditional voice T1 circuits, If a location requires that more than 23 calls be completed at the same time, a second T1 is added, bringing the total to 46 concurrent calls. The higher capacity is only available for that site. It is very different with SIP trunking. In most situations the SIP trunk is priced for aggregate concurrent calls for the whole organization, which means utilization is higher and monthly costs lower.

Another advantage of SIP trunking is reliability. The SIP trunk calls are sent over a data network to a Session Border Controller that can terminate the SIP call. If the first SBC the call is sent to is unavailable, then a second location can terminate the call. That means if a remote office site is not reachable due to power outage or natural disaster, the calls can still be sent to someone on the telephone system who is available. This lets the business to continue to provide customer service to the caller and not just deliver a busy signal, which is what the caller would receive if the call was directed to a voice T1 terminated by a PBX that was off.

Just like any newer technology, there are many details that have to be addressed in a SIP trunk deployment. When a SIP trunk upgrade is combined with a phone system changeover, there are more details and potential issues. For most organizations, the cost savings, improved availability and increased productivity from a new phone system make it a worthwhile changeover. SIP trunking combined with a VoIP phone system is a project that should be on every business´s future plans.

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About The Author
This is a great video from Adcap's successful seminar series about the Cisco SIP trunk, and here is a link to an article about planning a Cisco phone system upgrade.