Case Study:

The ROI of SIP Trunking

Date: Tuesday 2/3, 8:30-10:00am

Track: SIP-05 –SIP Trunking

Room: B114 / B115

Slide 2

Agenda

Case Study: ROI of SIP Trunking         

 8:30am     Introduction

 8:35am     Kool Smiles        

 8:55am     Bandwidth.com       

 9:15am     InGate Systems

 9:35am     Q&A       

Slide 3

Who is Kool Smiles PC?

• Kool Smiles PC is a network of local dental offices with a mission to expand access to high quality dental care to underserved children and young adults

- Achieved significant ROI and payback in 12 months with a 40% reduction in recurring telephony costs

- Accomplished through an IP-PBX upgrade and a SIP trunking deployment with InGate Systems and Bandwidth.com throughout all offices and the centralized call center

• What is SIP Trunking?

- SIP lines are JUST LIKE T1 lines or POTs lines to the end-user… except better !

They use the VoIP Protocol and are provided by an ITSP instead of a LEC

You don’t have to buy them in chunks of 23 channels anymore

They don’t have the same cost structure or geographic restrictions as legacy telephony

Slide 4

Kool Smiles Environment before SIP

• Kool Smiles in late 2007…

- Growing company

- Old style TDM PBX from 3COM fully deployed but lacking features of the newer IP PBX systems

No global address book and distribution lists

No fully redundant configurations : 5-9s of reliability

No unified messaging or hot desking

No centralized management

- Telecommunications costs escalating and taking on a bigger percentage of the IT OpEx budget

POTs lines at the locations….

T1s and long distance in the call center…

- IT Budget constraints and headcount pressure starting in 2008

Slide 5

The SIP Solution to Multiple Problems

We needed a solution for less headcount, more PBX functionality and less cost ! ? !

Enter SIP Trunking… Just like a phone line, but 40%-60% less !

• Upgrade proposal to Executive Management

- Evaluate offerings from Phone Equipment vendors

- Evaluate offerings from ITSP vendors and ongoing cost savings

- Purchase new Enterprise phone system centralized components and phone lines

- Create connectivity between the new system and existing NBX platform

- Stage each location to be trained and migrated to the new system

- Port phone numbers and consolidate/eliminate un-needed circuits

• Benefits

- 40-60% per year voice telecom cost savings (reduced costs and reduced lines)

- Reduced downtime

- Eliminate scalability concerns (10,000+ users)

- Feature rich enterprise phone system – better communications

- Lower administrative costs – reduce IT headcount

Slide 6

The Partner Search…

• Categories to rate vendor solutions

- Existing customer base with similar deployments and good references

- Unified messaging, find me - follow me, teleworker, ease of use

- Reliability, high availability, scalability (10,000+ users)

- Centralized management, SIP interoperability, standards and security

- Re-use of existing equipment, capex requirements, install complexity

- Business disruption risk

• Equipment and ITSP service interoperability and security was a key concern

- The SIP Trunk solution required some middleware to accomplish all the signaling and security that we needed

- InGate systems fit perfectly because of their partnership with our preferred IP PBX Vendor and preferred SIP trunking provider

Slide 7

Kool Smiles Network Diagram

Slide 8

High Level Project Plan & 2008 Results

4Q 2007 1Q 2008 2Q 2008

Oct Nov Dec J an Feb Mar Apr May J un

Tech training Order SIP numbers/trunks Test central components Migrate call center Sites training/migration Sites training/migration Sites training/migration

Porting Porting Porting Porting Porting

I nitial SIP Deployment only (no growth reflected)Voice telecom run rate pre-SIP (T1, LD, POTS) $427,000IP PBX and SIP appliance CapEx $375,000Network upgrades required $0Existing Telecom contract buyouts $0Voice telecom run rate post-SIP and porting $121,000Annualized SIP based savings $306,000

Cash Basis Payback Months 14.7 Accrual Basis Payback Months (36 Month CapEx) 5.3

SIP Savings (net of equipment charges - accrual) 40%

Annualized Full SIP Deployment with growth (12/ 2008)Voice telecom run rate pre-SIP (T1, LD, POTS) $816,000Voice telecom run rate post-SIP and porting $277,000Annualized SIP based savings $539,000

Slide 9

Lessons Learned

• Porting existing phone numbers

- Make sure your account is in good standing and completely paid up before issuing any port requests

- Notify the losing LEC that the number will be porting and authorize it

- Be extra careful if you are moving numbers from a non-facilities based LEC

• Check your existing telecom contracts for terms and auto-renewal language

• Having QoS on your data network will greatly decrease the probability of voice quality problems

• Having robust bandwidth in between your IP PBX and the SIP trunking ITSP will also decrease the probability of voice quality problems

• G.729 Codec should be used because of the decreased bandwidth requirements

• Plan out your E911 capabilities and test calls to the public safety providers to test the ANI/ALI delivery is correct for each location

• Select equipment and services providers that have a proven track record and can provide good reference accounts and great customer service

- 5,000,000+ calls since 2/2008 with very few issues

Slide 10

Key Partners