News : Don't Panic, Be Informed
Jan 11, 2008
Technology is ever changing and the one thing that is the biggest question for our music on hold providers is what effect VoIP is going to have on our industry. It is equally important for our dealers to be educated and informed when talking to your customers about how you can deliver your service.
First it is helpful for us to understand the VoIP market. New VoIP phone systems fall into two categories: Hybrid IP and Pure IP.
Hybrid IP
61% of market share in 2005 (based on revenue)
65% of market share in 2006 (based on revenue)
65% of market share in 2007 (based on revenue estimates)
Hybrid IP can use some of the older traditional accessories currently in a business location. For example this may be analog lines, existing phones, and modems. Often your customers may use their existing phones they had been using with their old PBX with the new Hybrid IP system. The hybrid portion is often a card that can be added to the PBX to allow for other remote IP phones and accessories to communicate with the older traditional analog lines. A good example would be the phone of a sales representative at their home, hotel, or other remote location.
Hybrid is the easiest and most popular system chosen because this requires little or no wiring for most businesses, but yet it gives the benefits of IP communication. The added benefit for the MOH industry is this has little or no effect on the delivery of your service. All systems sold have a traditional way of connecting directly to the MOH port (RCA or mini) of their system. Additionally, you can / will have an analog line for remote delivery.
Examples of hybrid phone systems - Avaya IP office, Nortel BCM, Toshiba CIX, NEC IPK
Pure IP
13% of market share in 2005 (based on revenue)
18% of market share in 2006 (based on revenue)
24% of market share in 2007 (based on revenue)
Pure IP is for customers using all VoIP communication. This is often a little harder to implement for businesses as this can be more costly and require more time to convert from their existing phone system. Most of the analog communication (faxes, modems, credit card machines, etc.) need to be converted to VoIP communication to accommodate a pure IP system. The biggest obstacle for businesses choosing pure IP is the possible need for new wiring within the business. Therefore, pure IP would be more common for a new construction or re-location of a business.
Pure IP can have a bigger effect for the MOH provider as these systems can sometimes steam a single audio file to multiple locations. However, with the exception of the Cisco Call Manager, they still have an audio plug-in jack on the phone system to use a traditional player. An additional concern would be the lack or elimination of an analog phone line for remote MOH delivery.
Type of Pure IP phone providers
Cisco, 3Com, (could also be the Avaya IP office or Nortel BCM - although all accessories would need to be VOIP compatible.)
The bottom line is, almost 90% of all new systems being sold today are VoIP systems. (Traditional PBX for 2007 is 11%) The key is to ask your client what type of phone system they chose and to see if it is a hybrid or pure IP version. Then you can take the necessary steps to accommodate delivery to their office phone system.
Phone system statistics are from Telecom Reseller and the Yankee Group July 2007 and are for world wide sales.