I expect VoIP usage in NLD next year

Originally a doctor, Dr Elon A Ganor’s claim to fame is VocalTec, a pioneer

in the Internet and IP telephony business. A very strong and vocal proponent of

VoIP, Dr Elon, in an exclusive interview to Voice&Data, takes on some of the

beliefs and concerns about VoIP among operators, regulators and policy makers.

It is generally assumed that since VoIP is cheap telephony, the voice

quality you get through it is not as good as the traditional telephony. What do

you think?



I don’t agree that VoIP has to be cheaper. That’s not true. VoIP in some

situations provides better quality than PSTN telephony, so why should it be

cheaper? VoIP is being used by nimble players like Data Access to enter the ILD

market. And when a new player gets into the market, it normally drives down the

prices. That’s why VoIP is being offered cheaper than the existing tariffs of

the incumbent ILD carriers.

Also, there was a time when VoIP technology was developing and it did not

compare to PSTN in terms of quality of service.

Hence there was a tag on it of an inferior service at a cheaper price

vis-à-vis TDM telephony. But that was long back. Now, we have come a long way.

Today, VoIP at core is as good as any TDM core technology. It is time to move

on.

But that’s not the perception of just the common man, but of many

operators too...



Incumbents have to make a switchover in their mindset by starting to

consider the business case of increasing their profits in absolute dollar/rupee

terms by expanding the usage of telephony rather than retaining a higher margin

in a static market. Also, they have to introduce and aggressively promote the

value-added services that can be offered with existing or new technologies such

as VoIP.

Do you think that this is also a case of resistance to new technologies?



Let me give you an analogy. Usage penetration of computers is so rapid among

the new generation, that many are fast getting used to the computer for writing

down anything. Some people are already more comfortable with their computer keys

than the pen and paper. TDM is the pen and paper while IP is the computer. There

is always an initial resistance among users to any new technology. But people

soon get used to it. Some learn quickly, others follow.

For India, what kind of a time frame do you have in mind for acceptance of

VoIP to take place?



The telecommunications industry in India is full of very educated people. I

have never seen such talent and wisdom anywhere.

At first, some were reluctant to consider IP for telephony. But I am seeing a

change happening in their perception about VoIP.

Quite a few of them are now aggressively pushing the case of VoIP in their

organizations.

You are supplying to lots of carriers worldwide. What has been your

experience with Data Access?



About three months ago, if we were to go to people and say that Data Access

would capture 30 percent of the Indian ILD market, people would have laughed at

us. The growth of Data Access in the ILD market space using VoIP is a world

record.

Data Access is a story that proves to others that they can also do it.

If this is the success story with Data Access, surely you would have other

customers in India who would be moving fast on VoIP? Who else are you working

with?



Besides Data Access, the incumbent operators too have been doing VoIP. But

they have not been moving fast enough. For rest of the industry, we are talking

to the usual suspects.

Typically, what is the investment required for VoIP?



With just a few million dollars, Data Access have captured 30 percent of the

Indian ILD market. And for the second phase of expansion, it has struck a deal

of only $8 million with us. VoIP requires small investments. The time to money

is real short. Other major Indian telcos including the incumbents have a great

opportunity to use VoIP for rapid rollouts of their telephone services to meet

the teledensity target of the country and make rural telephony a reality.

How is China implementing VoIP for NLD–that is a very successful

example?



China is very unique in the sense that telecommunications is closely

controlled and synchronized by the government. One decision makes all the

difference. In the true sense, it is not a competitive market like India. Also,

China carries really no baggage. They don’t mind taking drastic decisions

about technology. In the rest of the world, especially in Western Europe, there

is a strong sense of protecting incumbent carriers. Even though the PTTs have

been privatized, a considerable share of the equity is still owned by the

Government. There is a vested interest working behind protecting the incumbent

operators.

However, I am very confident about India. There is a lot of action in the

telecom industry here. India is a highly promising market. It is not hit by the

global telecom crisis. And it is uniquely placed to take advantage of new

technologies to quickly provide good telecommunications services. The use of

VoIP for ILD is already on. I also see VoIP being used for



various other services. Also, I am positive that by 2004 there will be NLD
implementation using VoIP in India.

You seem to be very happy with VocalTec’s performance in India ? But

there areother bigger vendors who also offer VoIP products. Is your happiness a

little too early?



My client Siddhartha Ray of Data Access has gone on record saying that when he
evaluated VoIP vendors, he came across switch providers and router providers

providing also VoIP. VocalTec was the only company which was doing only VoIP. We

are precisely that. We are a high-value VoIP boutique.

Can you share with us some insight about what is the position of your

Class 5 VoIP switches?



We are working on it. Soon, there will be some product announcements. I won’t

be able to comment more at the moment.

Ibrahim Ahmad and Nareshchandra

Laishram