SIP Trunking Cost Savings

Broadvox has claimed that it has saved 70% for some of the businesses that have switched from POTS/TDM to SIP Trunking. Earlier this week I read a column that questioned that amount of savings. They focused on the difference between long distance plans offered by traditional carriers and SIP Trunking providers. While this is usually as source of savings, it is seldom, if ever, going to represent a 70% savings. Let's look at the savings components:

·         Per line cost

·         Usage cost for local inbound/outbound calling

·         Domestic long distance calling

·         International calling

·         Toll-free inbound calling

·         Moving from dedicated PRIs to converged T1s

Today is not the time to go into depth on each of the above, rather my interest is in highlighting where to look for significant savings.

Per line cost can be reduced by 60-70% for small businesses with less than a T1 connection, remote/branch offices and telecommuters who are usually on an individual plan (with reimbursement) than an extended local number plan such as that offered by Broadvox.

Usage cost for local inbound/outbound calling or metered services while not as common these days is still prevalent. It is also a differentiator of offerings between SIP Trunking providers. Broadvox does not charge for outbound or inbound local calling. Therefore, savings can range up to 100% in this area.

Domestic long distance calling in the 48 contiguous United States and Canada is an often-stated major feature but the savings can be quite low. It depends upon the long distance package purchased or negotiated with a carrier. A simple unlimited long distance package can be purchased from an ILEC for $25 per month with Canada extra. Depending upon the long distance bundle purchased and usage, this is quite competitive with a SIP Trunking provider's offering. Savings here will be in the 5%-20% range.

International and toll-free inbound calling are hard to categorize for SMBs in particular. The range of savings is dependent on usage and size of business. As we say at Broadvox, "Call for a customized quote".

Finally, moving from dedicated PRIs to converged T1s may save a business 50% on connectivity cost and underutilized facilities.

By the way, given all of the above, you might think our 70% number is not achievable. Well, we actually saved a company that was connecting remote offices and transitioning from dedicated PRIs 75% over their previous phone bills. We are being a bit modest in saying 70%.

See you on Monday...