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Verizon, IP Centrex - Protecting Yourself? Or Creating a new Pain Point?

I've had some really long days this wee. Last night I posted an entry alluding to Verizons and one of their new offerings for a managed VoIP service. Tonight I want to revisit that post from a different angle. I'm even going to take issue with my own statements.

I said "for companies considering a managed VoIP deployment in conjunction with their existing partners..." Now I have to ask a question that won't make my old telco friends real happy, but it's important. How many of you are using Centrex services today? What percentage of those are being pitched IP-Centrex in some fashipin by their provider? And how many of you want to write a blank check to a vendor partner?

I remember a talk I gave on the evolution of VoIP in about 2001. I was asked by a room of technology trainers I worked with what I thought of IP Centrex and replied "You can buy a more expensive service, but you can't get less for your money, except maybe from ISDN."

That was a few years ago, but I have to say, not much has changed. First you need to understand that Centrex service has long been a cash cow for the telcos. The investment in equipment they made to provide this service paid for itself years ago. Yes, years ago. Centrex has long been the single most profitiable telecom niche for the old telcos. It's a huge money-maker. Huge.

When I initially made my statement a few years ago, they were making minimal investments in IP so they could sell IP Centrex, but the reality was, they made a tiny investment in IP so they could grab some VoIP karma without actually changing anything. That's changed a bit over the years, but IP Centrex, whatever the name, remains a hugely profitable, commonly overpriced managed service offering.

While managed services make sense in some cases, don't let yourself be sold a bill of goods. The telcos are all over the map on what they offer and how they support it. Their offerings tend to run on Cisco, Nortel or Avaya hardware. The ones using Cisco will tell you how more IP focused they are, but make no mistake, the traditional telcos focus on two things - making money and squashing competition.

In recent discussions in the Realtime VoIP Community forums and in a recent article, I've elaborated time and again on the importance
 of comprehensive readiness assessments. If you're considering a managed service offering, especially one like IP Centrex, you probably need to be even more thorough. The problems and headaches you can build for yourself are nightmarish and can take huge efforts to work around.

Are you going to need CTI integration of voice and data? If not now, will you need it a year from now? Like the old Centrex, IP Centre providers want you to sign long contracts so they can lock you in forever. I've seen many small and mid-sized companies trapped in 10-year Centrext contracts because they bought what sounded like a good deal. Make sure you know all the precise details of how CTI will work in your IP Centrex vendors plan? And be prepared to be enticed into a managed data offering in order to make it all work.

The bottom line is considering not just the technical details and not just the pricing. You have to look at all the technology, all the pricing and business models, and then you have to weigh just how much control of your destiny you're willing to cede to a vendor partner. Remember that vendor partners are just that, vendors first, then partners. Make sure they're earned and deserve your trust. The right partner can help you succeed. The wrong one can be like an anchor stifling the evolution of your companies converged services.

They're both vying for your business right now.

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Ken Camp's Bio:

Ken Camp has more than 25 years of experience in information technology. Ken spent 17 years with AT&T and Lucent Technologies successfully designing and implementing voice and data networks. He later worked in the security marketplace and played a key role in early IPSec VPN deployments. As an independent consultant, Ken's primary focal areas include network performance improvement, security practices and the design and deployment of integrated voice and data solutions. He may be contacted at: ken_camp@realtimepublishers.net

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