Enterprise Connect eNewsletter

The Hidden Costs of IP Phones

February 16th, 2010 by Eric Krapf

This issue of VoiceCon Enews is sponsored by Cisco

Cisco invites you to experience the power of collaboration at VoiceCon:

• Attend Cisco’s keynote with Tony Bates, Cisco Senior Vice President and GM, Enterprise, Commercial, and Small Business
• Meet with Cisco experts to design your collaboration environment
• Participate in Cisco breakout sessions
• See integrated solutions in the Cisco Partner Pavilion
• Participate in live Cisco TelePresence sessions

It is time to transform your business. This is the new collaboration experience.

www.cisco.com/go/vcnews3

The Hidden Costs of IP Phones

Gary Audin always devotes a chunk of his VoiceCon tutorial, “IP Telephony/UC Basics to Best Practices” to the new challenges posed by the need to power IP phones via power over Ethernet, and the many implications of this need: Most obviously, you have to buy new PoE switches or, alternatively, install in-line appliances to add the powering if you’re keeping your legacy non-PoE switches. Then, there are the implications of that PoE decision — start installing PoE switches in very tight wiring closets, and you’re looking at a buildup of heat in those closets that will require new cooling measures — venting, for sure, and possibly even the more expensive and disruptive need to add air conditioning.

It’s a second-order disruption that hardly anyone besides Gary talked about — until now.

In a blog post on No Jitter last week, Irwin Lazar of Nemertes Research wrote that these new, costly challenges are starting to come up in discussions he’s been having with enterprise decision-makers. But while Gary has approached this as a technology issue to be solved, and a cost to be understood (and not ignored), Irwin suggests that the costs of facilities changes to support IP phones are being seen as a reason not to deploy those phones in the first place.

It’s a convincing argument. Very few IP phones are different and better enough, compared to their legacy predecessors, to justify the trouble and expense of upgrading closets and switching infrastructure. Enterprises aren’t looking to invest in their legacy wiring infrastructure at a time when their workers are decreasingly desk-bound. And for those who remain desk-bound, digital telephone sets work just fine at what they’re supposed to do: Make good voice calls.

Indeed, one of the perennial straw-man arguments is whether the desk phone is “going away,” and the answer is always, “No, nothing goes away.” The real question is whether the desk phone market as a cash cow for voice vendors is going away, and the answer to that is increasingly looking like a “Yes.”

It really makes a lot of sense: For workers who want or need phones, they’ve already got phones. Giving them a new IP phone doesn’t just cost you a lot of money rebuilding the closets, it adds on the less-quantifiable but still real costs in re-training end users on the new phones, imposing changes on these users in return for incremental improvements in the functionality of an appliance whose fundamental look, feel and function has remained essentially the same.

Much of this reluctance to upgrade has been predictable and even predicted — for example, Dave Michels suggested last year on No Jitter that IP phone sales had already peaked. What’s different now seems to be that, per Irwin’s latest blog, enterprise decision-makers are starting to agree.

As Irwin suggests, this is a critical moment in many enterprises’ deployment of next-generation communications technologies. Many enterprises are ready or are getting ready to resume investments in communications technologies, in anticipation of an economic recovery — but they aren’t necessarily inclined to simply pick up where they left off when rollouts slowed down almost two years ago. They’re revisiting the whole architecture, and increasingly, they’re not seeing a reason to invest in new IP phones.

As I noted in a No Jitter blog post last month, Brent Kelly of Wainhouse Research has pointed out that a significant dropoff in the market for new IP phones will have a major impact on the revenues of the voice vendors. Irwin Lazar’s latest blog should give them more reason to beware of just such a trend beginning.

You can follow any responses to this entry through the RSS 2.0 feed. Trackback from your own site.


Leave a Reply

You must be logged in to post a comment.