TORONTO, ON - April 11, 2000 - Results from a breakthrough study examining the potential cost savings to companies who adopt Internet Telephony were announced today. Conducted by the Telecom Applications Research Alliance, the findings indicated companies stand to save hundreds of thousands of dollars by integrating their voice traffic into their data network.
The study, conducted by the Telecom Applications Research Alliance, in association with Member company DMR Consulting Group Inc., indicated the use of Voice over Internet Protocol can yield a potential savings of up to 35%, versus traditional Centrex or PBX systems. The study compared the implementation of a Centrex, PBX and VoIP model in a Canadian enterprise environment for three representative user groups - 100, 500 and 1,000 users. It examined the cost of ownership for enterprises of each campus size with the following results:
In a 100-user environment, enterprises employing VoIP rather than Centrex could achieve up to 18% cost savings - or $35,039 - over a three-year period. The same user base deploying VoIP rather than a PBX phone system could save $41,198 over three years, a 24.3% savings.
If a 500-user group utilizes VoIP rather than Centrex, organizations could save up to $211,250 - or 28% - over three years, while those employing VoIP versus PBX telephony could save $298,718 or 35.5%.
In the 1,000-user configuration, VoIP could yield up to $349,869 - or 23.8% - in cost savings over three years when compared to Centrex, while VoIP utilization could net potentially $467,950 in savings or 29.4% versus PBX switching for the same user number.
"This study proves the business case for VoIP," says Terry Hallett, director, research and technology, TARA. "VoIP is maturing rapidly and beginning to experience a large uptake in the Canadian enterprise market. This study confirms the cost savings associated with this revolutionary technology."
Simply put, VoIP involves sending voice conversations in digital form across the same local or wide area computer network most companies already have in place to support internetworking between PCs and servers. A major advantage of VoIP and Internet Telephony is its simplification of administration and its ability to offer the same full features in a small satellite office as are available in larger office sites.
"By bringing voice and data together, Canadian enterprises can not only save money, but can begin to implement a new class of productivity-enhancing services, such as unified messaging, all based on the same network," says Pierre-Paul Allard, general manager, Cisco Systems Canada. "In addition, enterprises can benefit from the simplified systems administration, expansion of geographic boundaries and empowerment of the mobile workforce offered by a VoIP solution."
About the Telecom Applications Research Alliance
Located in Halifax, Nova Scotia, TARA is a membership-based corporation whose mission is to enable its members to become world leaders in the development and exploitation of communication network applications and services. The TARA business model revolves around member projects within TARA program areas. TARA brings to member projects resources such as expertise, investment funding and TARA lab facilities. Member projects are owned by member companies.
About DMR Consulting Inc.
DMR Consulting is a leading international provider of e-consulting services and business solutions to the Fortune 500, governments and organizations of all sizes. With more than 60 offices in the United States, Canada, Asia-Pacific and Europe, 1999 revenues of $US920 million and a global base of close to 9,000 professionals worldwide, DMR is known for providing integrated business and IT solutions that enable clients to improve their competitive position, market share and productivity.
About Cisco Systems Canada Co.
Cisco Systems - with $12 billion (US) in revenues and over 19,000 employees - is the worldwide leader in networking for the Internet. Established in 1990, Cisco Systems Canada employs over 500 Canadians and is headquartered in Toronto, with field sales and service offices across the country. In addition, Cisco also has a state-of-the-art development centre in Kanata, ON - focusing on the development of optical internetworking solutions to build the next generation of the Internet backbone.
The Internet is changing the way people work, live, learn and play - and Cisco Systems Canada is a primary agent of this change and a compelling example of the power of this revolution. By widely deploying business solutions based on the Internet, Cisco Systems saves over $825 million (US) per year in operating costs, has grown revenues by 100% in two years and has increased customer satisfaction at the same time. Cisco produces networking solutions for enterprise organizations, service providers and small/emerging businesses. Additional information on the company and its products can be found at http://www.cisco.com/ca.