VoIP

Should I Buy a Softswitch?

Connecting analog and digital voice networks is cheaper than it used to be, but that doesn't mean that a softswitch is for everyone.

by Max Smetannikov [June 24, 2004]

Broadband customers now accept VoIP as a regular service. It's visible in the success of Vonage or Broadband Reports' reviews of VoIP providers. Many ISP operators are asking whether now is the time to buy a softswitch.

Big companies like Verizon and Comcast plan are planning their own VoIP deployments, but don't expect massive price drops the moment these companies start buying equipment. At The 451 Group, we estimate the total number of consumer VoIP users to be around 400,000, not nearly enough to force the phone companies and cable MSOs to buy softswitches. They just don't need them.

What is a softswitch?
A softswitch is a piece of software that performs voice switching on a server as opposed to within a platform designed to handle circuit switched traffic. The enthusiasm surrounding softswitches is quite understandable: circuit switched voice was traditionally handled by expensive class four or class five switches on the carrier side, and PBXs on the enterprise side, so the cost benefits of sticking a server into the network run to literally hundreds of thousands of dollars.

Who needs a softswitch?
Vonage-style services don't require a softswitch. It's partly about the architecture: a Vonage service requires a broadband modem coupled with either a Cisco or Motorola box which encodes phone calls into data and sends the data to Vonage's POP, similar to an ISP's own dialup or DSL architecture. At the POP, phone calls are decoded with a VoIP gateway and sent on to a POTS central office as regular (i.e., analog) circuit switched traffic.

With a Vonage-style service, a softswitch is only required when the total volume of calls eclipses what a traditional VoIP gateway can support—the volume has to be several millions of minutes a month. VoIP gateways are made by an array of vendors but the market share leader is, not surprisingly, Cisco.

Softswitches are more vital to ISPs looking to attract business VoIP customers. If you survey companies offering VoIP services to end users, you'll quickly see that business-oriented services (except for inappropriate consumer offerings marketed to SMBs) require a different level of service. That's because business customers expect a different set of features—IP centrex—thanks to a decade of marketing by vendors like Cisco, Nortel, Avaya, ShoreTel, and Zultys.

In the past, enterprises started buying softswitches because of the savings offered by a combination of less expensive gear (compared to hardware switches) and free calling. These sales took a couple of years to build steam, in part because makers of PBXs naturally perceived IP PBXs as a disruptive technology and therefore tried to prevent sales, but sales nevertheless took off in earnest last summer. Features now include moving extensions with a couple of clicks, unified messaging, and free interoffice four digit dialing around the world.

Not all platforms are inexpensive enough to support ISP-style services and robust enough to be carrier-grade. What you need is something like what Veraz Networks and Broadsoft have to offer—the likes of Zultys and ShoreTel are optimized for distributed enterprises. The softswitches that you keep reading about on the high end—the likes of Sonus—are really a replacement for very very expensive Nortel DMS 250-type class five switches and are really not the kind of gear you'd need.

In the long run, softswitches will come in handy as the volume of Vonage-style VoIP calls continues to grow. Look no further than wholesale VoIP market for guidance as to what kind of volume a carrier should have in order to be able to swing such a switch. Larger carriers like Primus Telecommunications that started out with VoIP gateways and now want to switch traffic between routes more aggressively than before are finding that having just VoIP gateways slows them down .

What if I decide to buy a softswitch?
In the unlikely event that you decide you want to become a full-fledged telephony business, consider the size of the softswitch stack you need to deploy in order to provide a telephone service that is a mixture of VoIP (digital) and TDM (analog)—expensive hardware should still be a business requirement for another quarter of a century.

In practical terms, the following devices are going to be involved in setting up and processing calls within a softswitch stack: a media signaling gateway, which allows calls to enter the IP layer via TDM and provide connect different pieces of the network; media and feature servers which support applications available via softswitches; and the softswitch itself which receives traffic, identifies ingress and egress phone numbers, and connects the call.

The stack often includes session controllers, which switch calls between IP Phones. A traditional softswitch still identifies telephone numbers by connecting to the circuit switched telephone network—a session controller takes IP to IP calls off the softswitch.

But most small- and medium-sized ISPs will find that, at the present time, they do not need a softswitch. Instead, many will find a partner who will help them enter the market and who will own a voice version of the POP-centric infrastructure that ISPs know so well.

—End