The SIP trunk market will die

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SIP Trunk Market Futures

Sounds a little negative does’t it? SIP Trunks? A big growth area? Die? SIP Trunks?

Well I’m not talking straight away. It’s got plenty of legs yet. The point it that SIP trunks are a replacement for ISDN lines into an on premise PBX. It’s the PBX that is going to die because eventually all “phone systems” will be hosted. They will merely be cloud based applications. Voice minutes will be integral to the whole proposition. No need for SIP trunks.

It’s the same argument as for VoIP gateways. Gateways exist to convert TDM to IP. When TDM systems fizzle out, break and die the gateway will be a redundant component. I don’t know how global gateway sales are doing. Still growing probably.

It’s an interesting conversation. What is the future of the voice market? Will there be one? Doomsayers have been predicting the death of the voice minutes market for ever. At least since the advent of VoIP. Costs plummeting, competition driving down ARPUs to near zero etc etc.

Actually the argument remains the same. Last night I answered my mobile phone and found it was Rob from the office calling me via Google Hangout. I immediately told him I’d ring him back on his landline. Uh?!

He wasn’t making a voice call. It was a Google Hangout. I only have 1GB of data in my EE 4G bundle. Video uses it up at a rate of knots. I rang Rob back on a geographic number to which I have unlimited calls at very low cost.

The mobile industry presumably currently makes it’s money from people breaking out of bundles, eg calling non geos not covered by the “unlimited calls” deal and from mobile data charges.

Rob in making the call would not have been paying anything. He was using his broadband bandwidth. The time will inevitably come where I can get the same deal on my mobile. In fact as broadband service providers are increasingly adding mobile to their deals (BT/EE!) a flat rate price for bandwidth of any flavour seems inevitable.

Add to that embedded voice in every browser and you have your ubiquitous and essentially free internet phone calls. All driven from web based applications. No SIP trunk in sight.

Just finishing off this line of logic we will actually still be paying for the calls indirectly. The big social media platforms which will essentially own the directories whilst giving away their service free to punters live off advertising revenues. Advertisers add the cost of reaching you to their products which you buy with your hard earned cash.

Still, the calls will seem free:)

I’ve had enough of this. TGIF. I’m off camping this weekend. C ya.

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  1. PhilT

    Out of bundle voice calls are lucrative to mobile providers – 35p/min and not charged per second it appears (after digesting my daughter’s phone bill).

    Telecoms and data are large fixed cost businesses that can elect to have fixed prices or charge variable amounts based on usage or perceived cost. The prevailing consumer approach is to present a low fixed bill as the soundbite marketing only really works on a simple low price offer.

  2. Jon Farmer

    As this market ‘matures’ we see more and more walled gardens springing up. Facetime, Google Hangouts, Facebook, WhatsApp etc etc.

    None of them interconnect easily if at all. At least with a landline or mobile you don’t need to worry about interoperability.

    1. Trefor Davies Trefor Davies

      I think they will all federate in the end

  3. Mike Ward

    It’s inevitable really as all technology eventually dies out and people move towards new trends, whilst we have plans to move to SIP and move our PBXs on all sites to a centrally hosted one in our DC we are also looking at giving people their extensions through our Lync/Skype for Business servers which will be interesting.

    I agree on the federating side, it’s already partly there when you see that XMPP based IM apps can already federate with the likes of Lync, we already ditched voicemail years ago and see more and more users wanting to be in touch wherever they are, I personally would prefer to keep the phone switched off 🙂

  4. Robin Williams

    While this may be true for many SMEs, I think as with cloud apps, many large companies and public sector organisations will resist hosting their voice infrastructure off-site and prefer to run their own ‘cloud’. You can still have all the benefits of federated comms with an on-site hosted UCS infrastructure.

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