Will Interoperability Problems Give IP Telephony a Busy Signal?

I nternet telephony, also known as voice over IP, may finally be ready for prime time in 2004. An increasing number of IP telephony providers , traditional phone carriers, and now cable companies—includingage—are offering a growing range of corporate and residential services nationwide. Internet telephony is attractive to customers because it uses lower-cost equipment and is less expensive to operate than traditional, circuit-switched tele-phony, thereby enabling carriers to charge lower rates. In addition, the technology conveniently integrates data and voice services on the same carrier's IP network. Bundled voice and data are also less expensive than each service purchased separately. And by combining the Internet protocol and telephony, voice over IP permits a broader portfolio of converged Web and voice services and applications , added Dan Dearing, vice president of marketing for NexTone Communications , an Internet telephony infrastructure vendor. Most Internet-telephony traffic consists of international long-distance calls. In 2002, Internet telephony accounted for 11 percent of all international long-distance traffic, according to a report by TeleGeography, a telecommunications market research firm. Industry research firms forecast steady growth in the IP-telephony market at least through 2007. For example, ABI Research estimates the market will increase from about $750 million this year to more than $8 billion by 2007. IDC predicts that corporate spending for IP telephony equipment will grow 44 percent to $3.2 billion in 2004. However, there are technical obstacles that could significantly impede the technology's marketplace growth. Providers' incompatible IP-telephony implementations make it difficult and expensive to move Internet calls between different carriers' networks. And as more calls shift to the Internet, these handoffs will grow in volume and complexity, further complicating the problem. Researchers are thus working on ways to enhance interoperability. Many Internet-telephony providers rely on the traditional telephone network to carry their traffic. IP-tele-phony systems use softswitches, which are open application-program-interface software that links traditional and Internet-telephony networks. They also typically employ media gateways, which use expensive digital signal processors (DSPs) to convert circuit-switched-based traffic originating and terminating on the traditional phone network to and from IP traffic. A key Internet-telephony interoper-ability problem involves the different ways that vendors implement two key standards. The standards. Two of the most important IP-telephony standards— the session initiation protocol and H.323—are at the heart of the inter-operability problem. SIP is an Internet Engineering Task Force signaling protocol for initiating, modifying, or terminating an interactive user session that includes …