When is a “trunk” not just a trunk? When it delivers the advanced communications services that businesses demand.

While we firmly believe in the industry’s move to hosted communications services, we understand there will be situations where a business can not convert overnight. During this transition period, service providers have an opportunity to show their customers a clear path to the benefits delivered by a fully-hosted environment. They can accomplish this by delivering SIP/VoIP PSTN connectivity to an enterprise’s IP PBX. But since no one wants to repeat that too many times, the process is commonly referred to as “SIP trunking.”

SIP trunking has traditionally been pitched by service providers as a lower cost alternative to TDM voice circuits, but the truly exciting aspect of SIP trunking is the numerous other benefits and capabilities it enables. Unfortunately these advanced communication capabilities haven’t been well communicated to the business community. Put that together with initial technical implementation challenges and spotty PBX vendor support, and it’s no surprise there has been slow adoption. However, the industry has focused on promoting the benefits of SIP trunking recently, and we’re seeing increased adoption and a greater awareness of SIP trunking in the enterprise space

This trend is also confirmed in a recent Infonetics report, showing that the SIP trunking market has finally moved into the mainstream. It’s now a very big growth opportunity for service providers. According to Infonetics, SIP Trunking is currently the fastest-growing segment of VoIP services. It’s expected to have an 89 percent CAGR from 2008 to 2013.

We’re definitely seeing that in the market today, especially with larger organizations. We have seen a rash of recent SIP trunking RFPs that indicate enterprises are finally realizing the benefits of SIP trunking over traditional TDM voice.

So how does SIP trunking go with hosted? SIP trunking is a highly complementary service offering to hosted Unified Communications (UC) – and something that significantly increases the addressable market for service providers. They can now support customers regardless of where they are in their migration path. SIP trunking also helps service providers sell into companies with hybrid hosted/premise deployment models.

To date, SIP trunking has been largely focused on recreating current TDM voice services (“trunks”) over IP. While useful, that’s only one possible use. We see the true market potential of SIP trunking in its ability to act as a hosted services “conduit” and to carry media other than standard PSTN quality voice – capabilities impossible with TDM.

Here are some examples of the unique capabilities that a service provider can deliver to an enterprise with SIP trunking:

  • Unified Communications “as a service”
  • Fixed Mobile Convergence “as a service”
  • Wideband audio and video telepresence
  • Fixed Line Short Message Service (SMS)

These capabilities are in high demand by enterprises – especially during the economic downturn – and represent a significant opportunity for service providers. Companies are not going to toss out their telephony networks overnight. Providers need to offer businesses an evolutionary path for advanced communications services that in many cases makes use of existing telephony infrastructure.

Change is scary, especially for the largest enterprises. But the productivity gains and the cost savings are undeniable, and SIP trunking puts companies on the path to the future of communications.