At the helm of the IP revolution

According to analyst IDC, the IP telephony market in Australia and VoIP in particular is going to grow at an annual rate of 50 percent over the next few years, with sales of IP handsets outselling traditional telephones by next year.

Neil says the choice is a no-brainer, given that every major enterprise level business and government department will adopt IP telephony as a matter of course over the next three years. By his calculations, currently less than 10 percent of enterprise businesses in Australia have deployed an IP telephony system, though he believes the number that have already made the decision to move is more like 35 percent. Of these, some will run hybrids with their older legacy systems, though from these figures it is easy to see the levels of growth anticipated.

"There are huge opportunities for integrators and systems engineers out there. There’s a lot of old tin out there that needs to be integrated, upgraded, whatever you want to call it."


Compelling business case

According to Neil, IP telephony is compelling for a number of reasons, the most obvious being its cost-effectiveness. "We’re not simply talking about free phone calls over a WAN here. The commercial value of having a centralised architecture with only one network to manage means potentially massive cost savings for a big company, which usually has a voice and a data network," he says. "When you combine reduction in overheads with improved business efficiency, IP telephony makes a very strong case."

Neil says the reluctance by many to fully embrace IP telephony to date had been due in large part to a general ignorance of the technology and concerns over robustness and security, issues which still needed some work, especially with regards to VoIP phone calls made over a WAN on the internet, as opposed to pure IP telephony on a company intranet or LAN. The message is, however, steadily getting out there, Neil says, as evidenced by both current take-up numbers and future growth projections.

Integrating some VoIP technologies with installed PABX systems was also useful for some organisations in helping them through a transition period to computer telephony or Ethernet-based phones.

Additionally, technologies such ATM and frame relay, which have a relatively longer history of transmitting voice over data networks, can assist in the transitioning of networks to full IP telephony, he says.

With regards to security, Neil says that IP telephony and VoIP require a new way of thinking about phone security, given that moving voice packets over the internet means it is now travelling on an open network, as opposed to a traditional closed voice network. This means that installing IP telephony onto an existing network would require a full assessment of the whole network.

Despite these teething problems and security issues, Neil firmly believes there are huge opportunities out there for channel companies in the IP telephony space. "When one takes into account the speed with which this market is growing, there will be a shortage of skilled people over the next three to five years. The market is simply growing faster than people can be certified and I am sure many resellers will build solid businesses around IP telephony," Neil says. What they need to do is make a choice as to what size market they wish to operate in, which partners they want to work with, and start to invest in training, he says.

Whilst there are more and more players coming into the market, there are still plenty of opportunities out there, from large organisations doing major build outs to smaller integrations and upgrades and the implementation of voice add-ons, Neil says.


Listing

NSC currently has around 100 full-time staff servicing around 430 customers in the enterprise market.

"Our main competition is definitely Cisco but we’re winning when we get into the trenches and fight them feature for feature. On ability and skill, we win hands down," Neil says.

The company has no immediate plans to list on the ASX, Neil says, claiming they want to reach a $100 million a year turnover level first, which is still a year or two away. "We are very happy with where we are at the moment and very excited about the market ahead. Best of all, we are in a position where we can do it with our own dollars."

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