Smart, Scalable VoIP from Sphere Communications

Monday May 2nd 2005 by Gerry Blackwell

The goal of this Chicago-based company is to make IP telephony a pure software play—and to build in programming hooks that lead to true integration of communications and business applications.

The VoIP world sets forth two key propositions, which it treats as axioms. One is that telephony is 'just another application on the network.' The second is that the real benefits of VoIP will come not from reducing total cost of ownership, the usual business case for migrating to IP telephony today, but from integrating telephony with other business applications on the network.

Sphere Communications, a pioneering enterprise IP telephony system provider, has probably done more than most to deliver on the promise of these propositions. Its flagship product, Sphericall, is a software PBX that runs on industry standard servers. The recently released Version 4.1 includes a new application programming interface (API) that will take Sphericall further down the road of delivering on the application integration promise. The API makes it easier for enterprises to integrate telephony with applications such as CRM (customer relationship management), ERP (enterprise resource management) and intranets.

Sphere, a privately held company, was formed in 1995 to develop VoIP products. It has been installing Sphericall and its hardware products—hubs and gateways—for eight years. The company has "a few hundred different customers," according to vice president of marketing and product management Todd Landry. Sphere employs about 50, most in suburban Chicago.

Bigger and smarter
"We've gone through several iterations of the product at the major release level with the emphasis always on growing scale," Landry says. "As we're building the architecture, it also moves further towards being a 100 percent software-based product, and one that addresses communications convergence rather than just VoIP."

On the scale issue, the last full version upgrade to Sphericall was tested as working with up to 30,000 users over multiple sites. The company has installed customers with as many as 18,000 users spread over 192 sites. Sphere's average customer has about 800 lines. "Some people mis-classify us as a small-business solution," Landry says. "In fact, if customers have 100 users or fewer, we generally don't spend much time with them." The company targets medium-size and large enterprises.

When he says the product is moving towards being 100 percent software-based, Landry in part means that Sphericall, unlike other software PBX products, is not dependent on an underlying packet switching engine based in hardware—Intel boards, for example. "We've implemented all of that [packet switching] in software," he says. "On a single medium-size server engine, we can turn up 1,500 users."

Also unlike other software PBXs, Sphericall runs on a standard Windows operating system. It doesn't require a special version with miniport drivers for the telephony functions, and Windows doesn't have to be embedded in the server system. Sphericall uses standard telephony interfaces SIP (Session Initiation Protocol) and MGCP (Media Gateway Control Protocol) and works with many IP phone products. (Sphere doesn't manufacture phones itself.)

Cheaper, too
Communications convergence is the holy grail of VoIP, but it's happening, Landry says, in phases. In the first, convergence simply means convergence of voice and data on the same network. In this phase, total cost of ownership (TCO) is the main benefit to the enterprise. The TCO proposition has been amply demonstrated. Especially with the commoditization of IP appliances in recent years—basic desktop phone sets now sell for between $100 and $200, a dramatic drop from a few years ago—the cost per user for IP phone systems is clearly less than for traditional phone systems.

Sphere claims its TCO is among the lowest. In a challenge RFP at the 2004 VoiceCon show, Sphere's bid on a system with 1,550 users and 1,991 total ports beat 15 other competitors, both traditional and IP. The price for the Sphere system came in at slightly over $800,000, while all others were over $1 million, most over $1.2 million. Sphere's cost per user came to about $450, compared to over $600 for all others, over $800 in one case. Prices for the VoiceCon RFP included IP phones, but not installation and maintenance.

One reason for the low TCO, Landry says, is that while most other vendors sell systems with core PBX functions and then charge additional for modules such as voice mail, unified messaging and presence, Sphere has one price for a complete system, including these functions. All were required for the VoiceCon RFP. Sphere also includes softphones on the desktop, which was not required for the VoiceCon RFP. (Sphere, interestingly, has one customer that uses only softphones and has no desktop phone sets.)

Sphere also only charges per user: $199 for each 'access license.' "This means customers can deploy Sphericall in an initial office at relatively little cost and then just add licenses as they grow it," Landry says.

It also means customers don't have to devote resources to keeping track of and ordering product options, because there are none. And the per user pricing means that if a customer wants to increase system resilience by adding a redundant server, they don't pay any more for software, only for server hardware.

Peeling the convergence onion
Sphere sees the next intermediate phase of communications convergence as the integration of functions closely related to telephony and messaging. These are already included in Sphericall—instant messaging (IM), presence, and smart phone lists, as well as voice mail, auto attendant, and unified messaging.

The presence features indicate in the desktop part of the Sphericall software whether a party is on a call, away from his desk, etc. It means callers can decide on alternative methods of communicating with the person and eliminates unnecessary calls and telephone tag. Customers can also use the presence features to indicate how they want other to communicate with them, depending on time of day or schedule.

The next stage of communications convergence is integrating telephony with more advanced applications. This is where the new Sphere COM Objects library included with Version 4.1 comes in. It's a communications API that enables tight integration between telecom and enterprise business applications.

One customer, a mortgage loan company, used an earlier version of the API to integrate its CRM system with Sphericall so that the CRM system triggered outbound call center calls to customers who had called earlier asking for information but hadn't called back. The company told Sphere that as a result of the integration project it had reduced the average elapsed time to close a mortgage loan deal—a key metric for the company—by 40 percent.

Smart, integrated system
In a typical Sphere implementation, the customer installs Sphericall servers in multiple offices and connects them in a wide area network. One powerful feature is that multi-site networks can function as if they were one big network with the multiple servers providing redundancy. If a Sphericall manager system in one location goes down, for example, users in that location see no degradation in service because the system automatically starts using a Sphericall server in one of the other offices to route calls.

The system also has intelligent call routing built in. If the call is to another office in the enterprise but the wide area network is down, the system knows to dial the same call over the PSTN—and this is completely transparent to the user. Sphericall also supports VPN connections from home offices and small branch offices that let users in the remote locations use the system as if they were in the main office.

Sphere does design and manufacture hubs and bridges ($3,500 to $5,000) that tightly integrate with the Sphericall software, but the software also works with third-party vendors' hubs and bridges. The Sphere products will be automatically detected and set up, making them easier to deploy, but that is about their only advantage over third-party products, Landry says.

The COHub gateway links a broadband data network to the phone network, either directly to a digital trunk or through a legacy PBX. The PhoneHub connects 12 or 24 analog devices to the IP network, delivering dial tone, line power and advanced calling features over regular phone wiring. The BranchHub gateway connects to six regular phone lines, twelve phone sets and your broadband data network. It's designed for small remote locations and integrates them with a main office Sphericall system. Sphere also has a teleconferencing hub that supports up to 60 simultaneous users.

Sphere will continue to push to make Sphericall a more purely software-based solution. It plans to release a new version of the product in the second half of this year that will support "soft trunking." Soft trunking sends IP phone calls as data from an enterprise phone system over phone trunks to media gateways at a telephone company's central office. It will mean the customer doesn't need to install gateways.

"We're really an enterprise telecom soft switch," Landry says. "We think that where this is going is that communications capabilities will be converged at the application level. The network will be the switch. You won't need a separate switch with an IP interface. We see this market going the way of the data networking market, where users can select best of breed components and have them play together seamlessly."

The great promise of VoIP. Sphere appears to moving in the right direction. The question is, is the market ready?

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