Circuits in an IP network can carry more traffic than circuits in a TDM network. Strategically, it costs significantly less to deliver calls over IP than TDM. The laws of economics drive us inexorably towards VoIP. However, there are a number of other benefits that are specifically useful for businesses.
TDM technology has evolved over a century and was developed primarily at the behest of the former nationalized Post, Telegraph and Telephone (PTT) companies, such as the UK’s GPO, before becoming BT. Therefore, the TDM network is rigorously designed and very robust. We take it for granted that when we pick up a phone and press a dozen buttons, another phone will ring anywhere in the world. When that phone is answered, we (usually) have a clear, uninterrupted conversation. This is not surprising given that multiple layers of switches and cables between the two phones create a complete 56 Kbps end-to-end circuit between them.
In today’s highly flexible and mobile workplace, this marvel of technology has a downside. You don’t call a person, you call a phone. So you assume that the person you want to talk to will be close enough to that phone to answer it, or has installed a machine to take your call, or is willing to pay more to have it transferred to someone else. device. Meanwhile, in an IP world, you connect to the network from any IP device, and if you’re connected to the Internet, the Internet can tell those trying to reach you where you are. VoIP will allow you to call a person, not a phone.
The other drawback of the TDM connection is that the circuit has a fixed bandwidth that was originally designed to support a telephone conversation and nothing else. Dial-up data communications and fax technology are essentially technical compromises. Anyone who has ever had trouble browsing the web over a dial-up connection will recognize this. The essential technical difference between IP and TDM technology ensures that a VoIP conversation makes better use of that bandwidth. In addition, with the ubiquitous availability of DSL, the Internet is now a multi-megabit broadband network that breaks free of the 56-kilobit shackles of the TDM network. The result is that we can have much more “rich” conversations with IP.
These conversations can include video images, instant messages, and data, all on the same circuit. Voice over IP is just one application in this converged communications platform. Ebay’s acquisition of Skype is a good example of creating converged applications. eBay is an online auction house that provides its bidders with images and data about the items for sale, in addition to conducting the auction on the web. Skype is an Internet telephony service. Combined, the two companies will offer a service whereby someone bidding on a particular item can click a button on the screen and speak directly to the person offering the item for sale. It doesn’t take much imagination to consider similar applications that improve efficiency and productivity in all shapes and sizes of businesses.
In summary, the three key advantages of VoIP over IP versus TDM are cost, flexibility, and better and richer forms of communication.