The Challenges of VoIP

Vendors of voice over Internet protocol (VoIP) services have made big promises to corporate America and consumers about the cost savings to come from VoIP. The possibilities of VoIP savings have stirred excitement even among jaded CFOs.

But the adoption of a technology that accommodates data and telecommunications streams, converting both to bits and bytes, also delivers a host of challenges. For some companies, there are internal fights over which department should make the VoIP purchase decision -- the telecommunications group or the more data-sensitive IT group. Who should manage the VoIP system? To whom does the data belong? Such questions haunted early adopters.

Buyer Beware

According to analysts who talked with CRM Buyer recently, new worries have cropped up as well. "You need a network guy, you need a phone guy, but you need a lot of other smart people, too, with different kinds of knowledge," said Lauren Weinstein, a consultant with People for Internet Responsibility.

"There's been a lot of convergence already. Convergence is not the key question right now," he said. "The more basic questions people need to be thinking about now are what are the big differences operationally between VoIP and traditional phone service."

For instance, he said, many companies don't even recognize that they are recording all of their internal and external phone conversations through the VoIP system. This potentially violates state laws that protect company employees from having their calls within the corporation monitored, and it surely violates laws that require callers to ask permission of their external contacts before recording discussions.

"People don't ... understand until lawyers come knocking on their doors," Weinstein said. "VoIP data just looks like any other data," he continued, and when companies back up their customer or transaction or marketing and sales data, they're also making copies of all calls conducted over VoIP.

"They open themselves up to a lot of liability," he told CRM Buyer. And the calls are often protected by little or no encryption. "It's common broadly in deployments to have poor security on VoIP."

Companies have the option of separating the data and voice streams in a VoIP system, but "to separate the data changes the economy [of the solution], and not in good ways," Weinstein said.

That means implementing VoIP responsibly may not produce significant cost savings.

Not Just Phone Calls

"Eighty percent of companies have some engagement with VoIP, but only 5 percent have it fully deployed over the organization," said Zeus Kerravala, vice president at Yankee Group. He told CRM Buyer that the huge gap between interest in VoIP and comprehensive use of its capabilities derives from a lack of confidence in the management tools that can be integrated with VoIP.

In one sense, Kerravala doesn't blame companies who fear a complete rollover to VoIP. "It's not right to manage VoIP in the same way as historical management data networks," said Kerravala. "It's about as real-time as data can be. With [traditional] CRM ... there is a little delay in information reaching the end user."

With VoIP, there is no delay. "Whenever you talk about any new market such as VoIP technology, there has to be a maturation of the psychology surrounding it," he said.

He said software developers have to meet the challenge of more widespread VoIP interest and adoption. "The tools need to get better first," he said. "I use the analogy all the time of the move from a mainframe to PCs. The value of PCs was not in the PC itself but in all of the applications you could run on them. It wasn't Microsoft (Nasdaq: MSFT) or HP (NYSE: HPQ) or Intel (Nasdaq: INTC) but all of the software companies created to do your job better.

"We have to look to the software community for what those applications will be" for VoIP, Kerravala continued. "Yesterday I was at a hospital that put a conversion network in for sending data to physicians to mobile phones, PDAs and notebooks."

Voice over Internet protocol is a smart move for companies "only when it's ... as close to 100 percent understood and carefully vetted as possible," said Weinstein. "A lot of people didn't have the environment to understand what they were getting into, and it's pretty hard to stop once you've started, to step back and correct your processes."