Two case studies tell a compelling story of saving significant costs and meeting business goals using Session Initiation Protocol (SIP) trunking rather than the traditional public switched telephone network (PSTN), along with the Cisco® Unified Border Element, Cisco's enterprise session border controller. The case studies feature a multinational technology company using a hosted conferencing application and a large service enterprise needing secure internetwork connectivity (Figure 1).
Figure 1. Saving Costs and Meeting Business Goals Using SIP Trunking
Both companies are real enterprises with real challenges and goals. Their stories give you detailed information about how SIP trunking and the Cisco Unified Border Element met the companies' goals - and practical ideas about how they might benefit your business and help you save on your communications costs.
In each case, the Cisco Unified Border Element routes calls onto outgoing SIP trunks. Available on a wide range of Cisco router platforms, the Cisco Unified Border Element handles security, session management, and interworking between the H.323 and SIP protocols.
Both companies also want to use the rich communications that the Cisco Unified Border Element enables, so its employees can work more productively, including, for some, with their peers at other companies.
Case Study: A Multinational Technology Company Using a Hosted Conferencing Application
Goal: Save PSTN costs and allow applications in H.323 and SIP protocols to interoperate
Company A uses conferencing software hosted by a service provider, Company SP. In the past, internal conference calls traveled through the enterprise WAN to a central Company A location. From there they went by PSTN to the Company SP server in a different city. This approach was expensive: Company A used some 60 million PSTN minutes a month, at a cost of millions of dollars annually.
SIP trunking was an easy choice for savings. In addition, however, Company A needed a solution that could interface between H.323 and SIP protocols because its call agent used H.323 for the conferencing application while the service provider used SIP. The company got both lower costs and interoperability with Cisco Unified Border Element. Figure 2 shows Company A's new network.
Figure 2. Company A's Hosted Conferencing Application Using SIP
Since deploying the Cisco Unified Border Element, Company A has moved more than 60 million minutes per month from PSTN to SIP trunks; the total over two years adds up to well over 1 billion minutes.
The new installation can handle peak loads of 10 times normal usage and has successfully supported the greater demand created by corporate restrictions on travel. Annual savings add up to more than $10 million. (Please see Table 1.)
Table 1. Comparison of SIP and PSTN Costs for Company A
Cost per minute
Total cost of minutes/month
Total annual cost of minutes
SIP monthly cost
Annual SIP cost
Total annual savings with SIP
Case Study: A Large Service Enterprise
Goals: Address internetwork challenges - the need for increased capacity, security, availability of standard voice features, and cost.
Company B needed secure ongoing communications with a specific partner, Company P. It also had four communications challenges: sharply increasing call volumes and costs, user requests for common call features, security, and aging core switches that would need replacing.
Company B runs a worldwide network organized around several core switching centers. For communications with Company P, voice and data calls were conveyed over PRIs directly between a pair of legacy core switches at each company.
The PRIs were costly, but the inability of the aging equipment then used to deliver common calling features such as caller ID, call forwarding, and call waiting between Company B and Company P was also important. Users in both companies strongly wanted these features, especially caller ID. They also wanted to enhance collaboration with Cisco TelePresence™ conferencing systems.
Companies B and P both had stringent security requirements. Even more than many other companies, they needed to protect their networks - especially their address databases - from unauthorized entry. Each company also wanted to control access to phone calls from the other so only specified callers could get through.
Both companies installed Cisco Unified Border Elements, embedded in Cisco 3845 Integrated Services Routers. They are now linked through these systems by direct SIP links; there is no routing by the carrier that provides the trunks. Figure 3 shows Company B's SIP network.
Figure 3. Company B's SIP Network as Planned
The Cisco Unified Border Element keeps voice calls completely separate from data traffic - another security precaution - and monitors whether calls from the other company are from approved numbers. In addition, the Cisco Unified Border Elements hide the IP addresses in SIP calls, and thus eliminate any sharing of internal routing information between the two companies' networks.
Both companies found another Cisco Unified Border Element feature particularly useful: It translates between SIP and H.323 protocols. As each company moves various applications from H.323 to SIP, employees at both companies can continue to use them even if a given application uses H.323 at one company and SIP at the other. This feature helps meet the goal of enabling rich communications.
Company B's goals were increased capacity, security, and features, but it also achieved cost savings. It has retired 10 PRIs that used to connect with Company P, for annual savings of $48,000. It plans to retire another 10 to 15 PRIs. Partway through the changeover, having retired 10 PRIs and taken thousands of minutes off the PSTN, Company B was still using roughly 15 thousand minutes per day over PRI links; at $.015 per minute, that adds up to about $50,000 per year. When the move to SIP is complete, it will have saved well over that sum in per-minute charges, while the annual savings from retiring 25 PRIs adds up to $120,000.
Company B is installing SIP capacity to its partner for up to 300 concurrent sessions for a cost of roughly $90,000. Along with greater capacity, Company B is also getting a more flexible network - SIP trunks reaching several locations at each company.
Company B and its partner are very satisfied with caller ID and the other calling features provided by newly installed Cisco Unified Communications Managers in their respective IP networks and conveyed between companies by the Cisco Unified Border Element. Both companies are also very satisfied with the voice quality and, of course, the security. Because of the quality of the user experience, they are moving ahead with plans to begin using Cisco TelePresence collaboration systems between their executive offices over the SIP trunking.
Calculating Your Own ROI
So here is the important question: How much will your company save by moving from PSTN links to SIP with the aid of the Cisco Unified Border Element?
You can get a pretty good idea, thanks to a detailed SIP Trunking Value Calculator designed for use by your Cisco account manager or sales engineer (Figure 4). You give your account team as much information as you want regarding several attributes: the number of sites in your network; their sizes and configurations - number of people and phones; number of calls during peak hours; average call durations; number of T1, E1, and PSTN lines currently serving each site; billed long distance minutes per site per month; the availability of Ethernet links; the quality of service required; and the routers you are currently using.
The calculator essentially computes the erlang savings - the savings due to pooling of calls across locations, given the availability and quality of service you require.
Most of the savings with SIP trunking come from two areas: close to 60 percent from pooling trunks, eliminating oversubscription; and close to 40 percent from per-minute charges on long distance calls. North American service providers typically bill SIP trunks at a fixed rate per month with an allowance of minutes. Many companies contract for about half of the minutes they typically use, and pay for the rest as overage. The per-minute charges are usually about half of that for PSTN lines, so the overall savings are substantial: If you are now paying four cents per minute, you end up saving about three.
Figure 4. The SIP Trunking Value Calculator
The SIP value calculator gives you detailed estimates of your likely savings - projections for five years and breakdowns of where the savings come from. It goes beyond just savings, though. Factoring in your expected costs for installing the Cisco Unified Border Element and changing over to SIP for external calling, it estimates your time to payback and your ROI over five years. The information is broken down and presented so it is easy for you to see clearly what and where you spend and save.
The availability of SIP trunking is an opportunity for savings that is too good to miss.
Deploying the Cisco Unified Border Element to put your PSTN traffic onto SIP trunks will save you costs by:
• Eliminating PRI trunks and the too-frequent capacity oversubscription
• Slashing PSTN per-minute charges by approximately three-quarters
• Combining voice and data transport onto one line
• Reducing IT management costs
Your ROI is likely to be as impressive as in these case studies.
And, in addition, the Cisco Unified Border Element enables secure, rich unified communications between your organization and your partners, suppliers, and customers. It can support new ways of doing business that improve productivity and profits. Not bad for a money-saver.