Certifications, Economy Put VoIP Rollout on Hold

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If you're looking for Internet-protocol telephony on a cable system near you, you might have to hold the phone for a while.

Earlier this year, predictions held that full IP telephony rollouts would be underway in 2003. But vendors at the Western Show in Anaheim, Calif., earlier this month were saying that 2004 seemed more likely.

Why the cooldown? Most blame an arctic blast from financial markets that have been critical of major MSO equipment purchases in a chilly economy. Others point elsewhere, to such key issues as a lack of devices certified under the new PacketCable specifications, as well as a muddy integration picture for gateways, softswitches and back-office systems.

Broadcom Corp. came to Anaheim with its new BroadVoice two-line VoIP product. But the best guess now is that such gear will be in trials through 2003, with rollouts more likely in 2004, said John Gleiter, director of marketing for cable modem and voice over IP products at Broadcom's broadband communications business unit.

Like others, Gleiter noted that certification testing for PacketCable 1.0 — which includes elements setting an IP voice call's signaling, audio codecs, billing events and connection with the switched public-telephone network — has just begun, so there are no certified products.

The results from the first certification wave will be announced later this month. But if PacketCable follows the lead of its older Data Over Cable Service Interface Specification siblings, no access units or cable-modem termination system (CMTS) devices will gain Cable Television Laboratories Inc.'s PacketCable 1.0 stamp on the first try.

"It's like early DOCSIS," said Gleiter. "The cable operators didn't buy into it until there were products that were certified.

"At the end of the day, we are confident telephony is going to happen," Gleiter added.

Motorola agrees

At the Motorola Inc. booth, IP voice was also evident, through the SURFboard SBV4200 modem the company has supplied for Comcast Corp.'s Philadelphia voice trial. But Motorola is also now pushing rollouts back to 2004.

"Certainly, voice-over-IP has not been the huge success we all hoped and expected by now," said Motorola Broadband Communications Sector corporate vice president and general manager John Burke. "Several cable operators have indicated they will have continued trials in 2003, with rollouts more toward 2004."

Some MSOs have told Burke they must first better establish their existing data services, he said, while others want more time to test — and gain comfort with — the range of gear needed to field IP voice. That includes assessing the options for gateway and softswitch products now out on the market.

"I think it is just going to take some time for them to get comfortable and decide which way they want to go," Burke said.

The slowdown has hurt some vendors. Arris Group PLC recently laid off 300 workers, in part because of lower projected demand for its IP telephony gear in 2003.

Overall, cable operators are being scrutinized by Wall Street when fielding any new services that come with a significant price tag for new equipment.

"It's probably not less of an interest in it, but probably what they all have been affected by is the financial market," said Arris Broadband president James Lakin. "People are not going to spend a lot of money in this environment for a lot of new services that are not going to generate big cash."

Instead, Arris will emphasize more modest data offerings already within operators' reach.

"Voice-over-IP obviously has a huge-revenue generating potential, but I also think what we are going to see is gradual rollout," he said. "Nobody is going to go out and spend huge wads of cash right now."

Arris also entered a partnership with Net2Phone Inc. to develop a full IP-voice system employing Arris access devices and Net2Phone call-management systems.

Linksys shift

Another clue cable operators are taking more of a "wait-and-see" attitude toward IP telephony service can be found in Linksys Corp.'s new cable modem/home networking router. Initially, the unit was designed with an embedded media terminal adapter to support voice service. The networking equipment provider changed its plans, though, according to director of broadband Matt McRae.

"We actually had that on the development road map, but cable operators said, 'No, just provide the interface for an MTA,' " he said.

Many also point to thorny integration issues as a reason to delay voice-over-IP.

MSOs are starting to realize that voice offerings are complex and get even more complicated with IP, said CedarPoint Communications Inc. executive vice president of strategy and market development David Spear. His firm is developing a multimedia switch that combines softswitch and call-management functions.

The change from switched telephony to IP is not just a matter of hooking up a softswitch in place of a Class 5 unit, Spear said. Duplicating call features, signaling and billing — not to mention links to the public circuit-switch network — actually make VoIP more complex than older switched telephony systems, Spear said.

That's one reason Cedar Point early next year will introduce its Safari C3 device, which combines softswitch, call management and voice gateway functions into a single unit. The company recently added a reverse GR-303 gateway functionality, allowing for switched and VoIP traffic to terminate at the same device.

"Why would anybody play if they don't know it is absolutely, positively going to work, and they aren't going to have to forklift it?" Spears noted. "I believe the vendors have to come together. They can't really rely on the cable operator to do the integration."

Syndeo: On sked

Softswitch system rival Syndeo Corp. claims it is the only provider that has gained interoperability with the major cable-modem termination systems. For Campbell, Calif.-based Syndeo, the idea of tests in 2003 and rollouts in 2004 was no surprise.

"Actually, it is on schedule for us, because we always thought that 2003 would be more 'Let's get it right,' " said Maryling Yu, senior director of marketing.

The integration of all of the moving parts in voice-over-IP is nonetheless key, as the technology moves from test bench to cable headend.

"There is going to be no one single gunner here," said Syndeo CEO Ted Griggs. "At the end of the day, it is still up to the vendors to make sure they are on top of this. In the trials we are in, it has really been that way."

In the end, though vendors might be disappointed with the delay in IP voice rollouts, they also don't think it will join interactive TV on cable's back burner.

"We still believe in it, and we're still investing in this," Broadcom's Gleiter said. "We are asking a lot of specific questions to cable operators, asking 'Look — should we be investing in this?' and they are saying, 'Yes.' "