Session Initiated Protocol (SIP) trunking allows telephone calls to travel as digital Internet Protocol (IP) signals from end to end instead of using the conventional analog public phone system. It makes it possible for a business to leverage IP across its network perimeter—from within the enterprise out into the world beyond — while also merging voice, data and video into a single pipe. SIP continues to grow in popularity, as evidenced by Frost & Sullivan’s forecast that the North American VoIP access and SIP trunking services market will expand at a compound annual growth rate of more than 27 percent through 2016. As companies consider ditching their legacy voice connectivity, they’re seeing benefits ranging from cost savings to increased functionality and flexibility in the world of SIP trunking. Here we’ve broken down some of the perks enterprises can enjoy with SIP.

The Cost Savings

Experts say that the savings from SIP depends on a number of factors, from your enterprise’s current network architecture to the sort of prices you were able to negotiate for your legacy telecom services. Average savings are generally said to be around 30 percent, though some users will see their bills drop more than that. One big part of the reason behind those savings is SIP’s ability to escape the old, often inefficient way of buying voice bandwidth.

Legacy phone systems use primary rate interface (PRI) circuits, which are typically available only in 23-channel increments. Some providers offer fractional PRIs, but they are rare. Each channel in a PRI can carry a single voice call, meaning enterprises often purchase enough PRI circuits to support their maximum estimated traffic load. That leaves many of those channels unused (but still paid for) during all but peak times. “There is a big opportunity to aggregate PRI trunks and to centralize,” says Charles Studt, vice president of Product Management at IntelePeer in San Mateo, California.

Centralization is possible for those enterprises with multiple locations, because PRIs are typically able to serve only a single site. Each site then has one or more PRIs that are only fully used during peak times. This typically results in wasted bandwidth and wasted dollars. “When you have many PRIs scattered throughout the organization, and many separate broadband connections, consolidating those results in tremendous cost savings,” says David Byrd, CMO and executive vice president of Sales at Dallas-based Broadvox. By combining services across the enterprise, he says waste can be eliminated, and recurring charges go

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