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When deciding whether to deploy PacketCable, broadband VoIP or both, be sure to consider your voice experience, subscriber base, market conditions and risk.
By Peter Krautle, Nortel Networks
The transformation of legacy networks supporting analog TV or telephone service into a converged digital broadband pipeline delivering video, data and voice applications is happening with breath-taking speed in today's marketplace. Traditional phone companies quickly are recognizing that bundled voice and data services are no longer sufficient to retain residential customers. Many are partnering now with satellite providers for video and are moving to build higher bandwidth or ultra-broadband infrastructures to deliver their "triple-play." The bundling of voice services with other TV and data services represents not only a new revenue stream, but more importantly reduces subscriber churn to other providers.
One of the questions faced by cable operators planning packet voice services is whether to deploy basic PacketCable voice over Internet protocol (VoIP) services or more advanced voice and multimedia services, sometimes called broadband VoIP. The optimum strategy for some cable operators is to start with PacketCable VoIP for some markets, but also overlay broadband VoIP in other customer segments. The decision criteria of when to deploy PacketCable versus broadband VoIP can be addressed methodically by looking at the values and attributes of each service. Let's start by contrasting PacketCable versus broadband VoIP, and then summarize the decision criteria of when to deploy these services.
Understanding the difference
Figure 1: Residential Communications Options
The best way to describe these two services is to look at how I use them in my daily work (see the Figure 1 above). My home office is located in New York, with high-speed Internet and PacketCable VoIP service provided by my local cable company. It ran coaxial cable into my home and connected the cable to an embedded multimedia terminal adapter (EMTA) that has both RJ-11 and RJ-45 physical interfaces. One phone cord from the standard phone jack (RJ-11) on the EMTA runs to my traditional office phone for voice, while a second cord goes from the data jack (RJ-45) to a router that connects all the Ethernet devices in the home.
When I use my office phone, the traditional analog telephone signals within my house are converted to IP signals at the EMTA, and the voice call is transmitted as IP packets over the cable operator's data network to another subscriber's EMTA if we're both using the VoIP service, or to a media gateway where the packet voice stream is converted to traditional time division multiplexing (TDM) signaling to connect to the public switched telephone network (PSTN) as a local or long-distance call.
In the PacketCable environment, the softswitch continually monitors both ends of the call, and when completed, generates the appropriate call detail records (known as event messages) to be used for billing. This is PacketCable VoIP service-voice telephony that replicates local phone service provided by the local telephone company, with identical features such as caller ID and call forwarding. Although my voice traffic rides on top of the same IP infrastructure as my high-speed Internet service, what's unique is that voice packets are prioritized over other data traffic. So even if my teenagers are doing heavy file transfers with their friends down the road, the voice quality on my calls never suffers.
Adding SIP features
My employer also provides me with a broadband VoIP service for my home office that enables me to do voice, video, instant messaging, file transfer, Web push and whiteboard collaboration. From my cable provider's perspective, it's just another high-speed Internet application running over the cable modem to my home. A session initiation protocol (SIP)-based multimedia PC client on my laptop works with an IP phone and a video camera mounted on top of my screen for video calling.
When connecting to my corporate network using a secure virtual private network (VPN) connection and logging into our multimedia server using my SIP client, I immediately have access to other multimedia subscribers on our corporate network. These users can reach me via my SIP address or by an external telephone number mapped to my SIP address. This type of advanced multimedia service with presence capabilities allows me to see who is connected to the server, who is on the phone and who is away. Whether someone calls my SIP address or my external telephone number, a window comes up on my laptop signaling an incoming call, and my IP phone rings simultaneously. If busy, I can respond to incoming calls from other multimedia subscribers with an instant message to let them know why I cannot take the call. If an incoming call is answered from another multimedia caller with a camera, then a video session can be established automatically.
Service-rich offering
What's particularly compelling about this service-rich broadband VoIP offering is portability and follow-me services. For example, other people can reach me easily using the same SIP address whether I'm in my office or hotel room. As a cable solutions architect, I find that multimedia broadband VoIP service has become an essential part of my working environment and enhances how I communicate with others on a daily basis. Clearly this category of broadband VoIP is a step above traditional telephony and is a powerful offering.
There are other examples of broadband VoIP applications that run over high-speed data networks. Some service providers deliver broadband VoIP by connecting an analog phone to a SIP-based terminal adapter in the residence that routes signaling and bearer path traffic over public high-speed cable and digital subscriber line (DSL) access networks. This type of broadband VoIP application provides voice-only SIP service and is appropriate for users looking to reduce their monthly long-distance costs. MSOs such as Comcast publicly have announced intentions to prototype advanced services such as videophones for residential deployment over their data networks.
Deciding which to deploy
While there are many potential combinations of VoIP technologies, today cable operators are making decisions about their starting point. No clear answer fits every company, but rather a set of decision criteria can help cable operators decide between leading with PacketCable or a type of broadband VoIP (see table 1).
Table 1: Decision Criteria for Broadband Voice
If the compelling event for entering the cable telephony market is speed to revenue-generation and to counter increased competition from all sides, then broadband VoIP service is advantageous because it is easier to launch across a data network, does not require truck rolls and is supported economically from a customer care and billing perspective. On the other hand, if the strategy of the cable operator is to compete directly with the local exchange carriers (LECs) for the triple-play of whole home communication, then the PacketCable architecture has the clear advantage of offering a full LEC displacement solution.
From a planning and operations perspective, broadband VoIP requires less cable operator voice experience, has fewer regulatory issues, and local telephone numbers are easier to obtain because of the use of primary rate interface (PRI) circuits for PSTN connectivity. The trade-off, however, is usually in the bottom line. The total revenue opportunity for PacketCable VoIP where all residential telephony revenue is directed to the cable operator is greater, yet the regulatory and interconnection issues alone make full PacketCable VoIP more complex to launch. To succeed in this market, cable operators either must possess strong telephony expertise in-house or work with partners who can deliver voice, regulatory and interconnection services. For those cable operators that already operate a TDM telephony environment, the PacketCable environment is easy to adopt and worth the extra effort.
Cable operators whose subscriber markets have high broadband penetration possess a good opportunity to generate incremental revenue with broadband VoIP services. Home office and small business subscriber markets serviced by cable modems are a good niche market for broadband VoIP deployment, and cable operators have the flexibility to offer this service easily outside their existing footprint.
However, cable operators that serve rural markets or have a smaller percentage of broadband users may find that they do not have enough subscribers with a need for multimedia services to justify the deployment of a broadband VoIP solution. For those operators, a PacketCable service will provide a better solution for their subscribers' needs.
Where the market conditions are such that the tariffs for traditional primary line are low and there is strong customer loyalty to existing voice carriers, broadband VoIP may be an excellent way to address specific subscriber requirements and validate the operator's ability to penetrate the market. PacketCable VoIP service plays well when local phone tariffs are high and cable operators can compete with similar service functionality at significantly lower monthly rates.
From a customer financials perspective, broadband VoIP service is easier to launch, especially with investments in online VoIP subscriber self-activation, maintenance and billing portals. For example, product introduction costs can be avoided with broadband VoIP by eliminating the need for truck rolls, home wiring services and operator skills associated with troubleshooting voice quality calls at the physical hybrid fiber/coax (HFC) layer.
In contrast, PacketCable VoIP has been designed for cable operators who plan to compete via bundling of video, data and voice services with voice quality and reliability that is equivalent to today's TDM-based solutions. Furthermore, additional home wiring and installation services may be offered by operators introducing PacketCable VoIP into their networks.
Determining when to lead with broadband versus PacketCable VoIP service (or deploy both) is a complex decision for every cable operator and includes an assessment of the compelling events for each market, voice experience, subscriber base, market conditions, customer financials and risk. The answer will be unique based on answers to these attributes-for some cable operators, the answers may change depending on the requirements for a specific cable system or market they are trying to serve.
Peter Krautle is senior advisor, MSO solutions for Nortel Networks. E-mail him at
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