Once a customer has decided to take on an IP Telephony system, one of the questions faced is whether to deploy a premises based system or a hosted/network based offering.

Courtesy of Ovum, the different types of options are outlined in the diagram (pictured right):

The two categories the subject of predominant global revenue forecasts according to Ovum are Managed IP-PBX (premises based, customer dedicated infrastructure) and IP Centrex (hosted/network based, multi-tenenated infrastructure).

Telstra offers both premises based and multi-tenanted hosted services in both traditional and IP deployment models. As mentioned in earlier blogs, premises based deployments dominate the Australian market (about 90% of in-place handsets) but increased share of the enterprise telephony market is forecast for hosted, multi-tenanted solutions.

Why is hosted expected to pick up?

I see a number of market trends favouring future deployments of hosted solutions. These trends include an increase in outsourced managed network services, a greater dispersion of workforce with greater mobility requirements and more dynamic business environments favouring flexible “as a service” models.

Will hosted dominate the market?

I do not think so unless compelling features particularly around fixed to mobile integration are developed. Remember, 70% of customers today renew with their existing provider in a market today where 90% of handsets are associated with premises based systems !!!.

In looking as to whether a customer might favour a Hosted/Network based or Premises based solution, I thought I might share with you a rough assessment guide I developed around a year ago (pictured right):

The idea with the assessment guide is to develop a customer preference based on the seven central criteria.

Does the customer have a strong brand preference?, if yes, they are more likely to favour a premises based solution. Does the customer has a widely distributed mobile workforce?, if yes, a hosted solution may be more suitable etc etc.

Here is completed assessment of one customer I reviewed (pictured right):

As per the assessment, the customer had as drivers a new site relocation and deployment of a Telstra IPMAN/WAN from which greater utility could be extracted in terms of converged application deployment.

The customer did have a leaning towards a certain type of premises based system but assessment of other criteria leaned towards a hosted model.

So, what happened?

Although the customer strongly valued the consultative approach of the Telstra sales process, ultimately, they selected the premises based solution towards which they had a strong brand affiliation. This solution also had a number of innovative features, present and planned, that the customer placed significant value upon.

My take-out?, the customer is always right and we were more than happy to fulfil the customers desired premises based solution.

That’s it for today and I hope I have shared some thinking re the difficult processs of choosing the right type of IP Telephony solution. Next time I might delve more into Telstra’s hosted offerings in a feature/function/benefit mode.