3 C o m Te c h n i c a l P a p e r s

Packet Telephony Primer

Packet Telephony Primer

Contents
Introduction A New Value Model Present and Future Telephony and Computing Models Market Drivers Tariff Arbitrage Freedom of Choice Plummeting Capital Costs Microsofts Application Dominance Intels Planned Obsolescence Strategy Voice Connectivity over Data Applications What Is Packet Telephony? Carrier Applications Enterprise Applications Packet Telephony Standards Packet Telephony Products Toll Bypass Products Internet Phones LAN-Based PBX Systems The UnPBX Related Products and Markets Long-Term Trends Building a Packet Telephony Network The Desktop The Gateway The Gatekeeper IP Fabric Key Market Issues Where Is the Technology Going? 2 2 3 5 5 5 6 6 6 6 7 7 7 8 8 8 8 8 9 9 10 10 10 10 11 11 12 12

Packet Telephony Primer

By Chris Lamb

Acronyms and Abbreviations

ACD automatic call distributor ATM Asynchronous Transfer Mode CoS Class of Service CTI computer telephony integration ETSI European Telecommunications Standards Institute IEEE Institute of Electrical and Electronic Engineers IETF Internet Engineering Task Force IP Internet Protocol ISDN Integrated Services Digital Network ITSP Internet telephony service provider

This document describes many of the concepts underlying packet telephony. Packet telephony is a technology by which voice traffic is placed on packet-based networks such as those running the Internet Protocol (IP). The concepts described here are sufficiently general that they also apply to voice over Frame Relay and voice over Asynchronous Transfer Mode (ATM). The term packet telephony encompasses all of these manifestations.
Introduction

3Com Corporation has embarked on a broad strategic and product initiative to drive the convergence of data and telephony networks by delivering a wide range of capabilities to meet the business needs of enterprises worldwide. By marrying technologies that have traditionally been separate, 3Com is poised to move the industry to a new paradigm. The convergence of voice and data networks has the potential to drive radical changes in collective business behavior by delivering information more pervasively and more completely than todays networks. The 3Com vision is to create a single fabric to deliver both voice and data, enhancing the effectiveness and productivity of individuals in corporations worldwide. Today, customers can purchase systems that wed voice and data in limited applications and with confined scope. The automatic call distributor (ACD) is one such example (Figure 1). ACD systems allow customer service agents in telephone call centers to access cus- Database r serve tomer files in conjunction with incoming telephone calls. Though they have existed for years, ACD call centers remain costly and difficult to deploy, requiring a great deal of customized systems integration for each site. Another example is the voice logging/ auditing system used by emergency call centers (e.g., 911) and by financial institutions. Again, the deployment of these systems has been

limited because of the awkwardness and limited scalability of the underlying technology: voice on one network, data on the other, tied together by obtuse database linkages. By creating a single unified fabric for both voice and data, 3Com is laying the groundwork for a realignment that will allow the easier and broader deployment of such systems. The real power of data and telephony integration is its potential to spawn new applications. Integral to this opportunity is the use of industry standard architectures upon which independent third parties can build applications. Such applications have the power to spark radical shifts in collective business behavior. While the potential impact of this convergence is enormous, the size of the separate installed bases of data and voice makes migration a formidable task. Solutions available up to now have generally been limited to point products with relatively narrow scope and with no answer to the installed base dilemma. As a multi-billion dollar company, 3Com offers the breadth of products and the depth of experience necessary to migrate customers to this new paradigm. 3Com is committed to protecting its customers investment and to migrating their infrastructure in ways that respect their current business practices.
A New Value Model

The goal of packet telephony is to provision voice over packet-switched fabrics in both the

net Ether

ACD

Trunk PSTN

s on Stati e ac f r e t in

Figure 1. Automatic Call Distributors Tie Telephone Systems and Data Communications Together

Applications IVR

Call centers Voice mail API Call processing

PBX Conference bridge

Applications: processes and telephony services visible to end users

Services

Resource management API

Accounting & settlements

Services: software and middleware need to provision applications over packet fabric

Acronyms and Abbreviations

ITU International Telecommunications Union IVR interactive voice response MCU Multipoint Controller Unit PBX private branch exchange PCB printed circuit board PRI Primary Rate Interface PSTN public switched telephone network QoS Quality of Service RSVP Resource Reservation Protocol TDM Time Division Multiplexing VOIP voice-over-IP xDSL digital subscriber line

Infrastructure

Switches

Routers

Gateways

Infrastructure: switches, routers, and gateways need to support QoS

Figure 2. Packet Telephony Will Transform the Communications Industry

local area network (LAN) and the wide area network (WAN). Whereas today voice and data generally flow over separate infrastructures, the vision is to drive these two communications methods over a single medium, allowing users to engage in media-rich communication in a natural and straightforward manner. 3Com is sowing the seeds of a paradigm shift. This shift will turn the telephony industry, which to date has been highly vertical and proprietary, into a horizontal industry, opening it to a flood of new vendors and applications. 3Com is uniquely positioned to drive this shift by providing value to customers for their next-generation networks. With the move to integrated data and telephony over packet networks, the communications industry will emerge into three distinct strata (Figure 2), with vendors providing value predominantly in one stratum and partnering with vendors in other strata. At the first level reside the infrastructure players: vendors who provide the network foundation upon which the other levels are built. This level will be 3Coms primary area of focus. Infrastructure will consist of 3Com systems products, including switches, routers, and access devices, all of which will support multimedia. To date, 3Com has offered many multimedia-enabled infrastructure products, starting with SuperStack II switches with PACE technology, first introduced in 1995.

3Com continues to introduce multimediaenabled products to help migrate users to next-generation networks supporting mediarich applications such as packet telephony. The next level consists of services. This stratum will be dominated mainly by software vendors who provide underlying software to manage transactions. Examples of these services include call processing, resource management, and accounting and settlements. This technology will be generally transparent to users, much as the network operating systems running on todays LANs are transparent to network users. At the top tier are applications. Applications are visible to end users and provide the services required to initiate and complete business transactions. Examples include call centers, interactive voice response (IVR), conferencing bridges, and private branch exchanges (PBXs). Today, most application vendors deliver highly vertical products based on proprietary hardware and software. Forwardthinking application vendors will migrate to a software-only business model. This tier will also see the emergence of large numbers of start-up ventures.
Present and Future Telephony and Computing Models

The transition to this new order will likely occur gradually, emerging from organizations back offices and special applications workgroups.

LAN

Phon Trunk er Carri s PBX

e line

Figure 3. Data Networks and Telephone Systems Are Completely Separate Today

The current paradigm consists of a circuitswitched fabric for voice networks (Figure 3) and a completely separate LAN infrastructure for data. Today, most businesses use a proprietary PBX or key system for voice. The hybrid model (Figure 4) is typical of todays computer telephony integration (CTI) implementations. While most businesses continue to run the bulk of their enterprises on separate networks, some have selectively deployed hybrid systems for specific applications, generally those designed to generate revenue, such as telemarketing, or minimize costs, such as after-sale support. In a typical CTI system, the incoming callers number is transferred to a database application, which displays information related to the call, such as the customers service record. There is loose coordination

LAN base Data r serve

Prop

y rietar ol contr ace f inter Trunk s

Phon

e line

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Figure 4. Hybrid Paradigm: Arms-Length Connection Between Data Networks and Telephone Systems

over a proprietary link between the telephony and data traffic. Such applications allow a customer service agent to transfer a customers data records to a specialist along with the call. The key to the hybrid paradigm is that computers and telephony are loosely integratedthe I in CTI notwithstanding. The CTI market is severely restrained because it relies on proprietary connections between insular systems. Unlike the world of packet telephony, which throws the doors open to unfettered competition, CTI relies on an armslength relationship, over a proprietary link, between complementary vendors who have worked out bilateral business arrangements. The dynamics of the CTI business are very different from the LAN industry. As compared with the brutal free-for-all of the LAN marketplace, the CTI approach makes for a Tower of Babel in which vendors, by building competitive moats, have restricted their ownand their competitorsfreedom of action. While CTI had the potential to be wide open, due to the closed-system roots of the major players, this market became an oligopoly of telephony-computer partnerships. The new packet telephony paradigm consists of telephony and data tightly coupled on packet-based, switched, multimedia networks (Figure 5). In this new world, data and voice share a common transport. Designed with next generation networking equipment, this fabric is capable of growing to support future applications such as video conferencing and video streaming. The fabric can support multiple Classes of Service (CoSs) and provide guaranteed Quality of Service (QoS) to multimedia applications. In this paradigm, the transport for telephony becomes transparent; users will be unable to distinguish whether a call is placed over a packet network, a circuitswitched network, or a combination of the twonor will they care. This new paradigm has the power to spark fundamental shifts in collective business behavior, as people exploit the simultaneous and joined delivery of voice and data applications over a single, unified fabric. This will provide unprecedented opportunities for new enterprises to provide innovative applications.

fice ch of Bran

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ral s Cent

ite

orate Corp et n r int a itch ss sw Acce uter or ro cess te ac Remo rver se ay gatew

itch ss sw cess Acce uter te ac or ro Remo gateway r serve

ary priet r pro ne o g Analo ital life li dig

PSTN

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Voice g loggin r e v r e s

edia Multimflow k r wo r serve

PBX ACD/ r r se ve

Figure 5. New Paradigm: Voice and Data Merged in a Single, Open Architecture

The transition to the new paradigm will take years to complete. Today, only a small subset of customers have any compelling business need to adopt this new technology. However, as the technology matures and new applications proliferate, packet telephony will appeal to a broader market. These customers will be looking for standards-based solutions delivered end-to-end by vendors such as 3Com.
Market Drivers

New technologies and applications must offer customers definitive value. The value proposition for packet telephony will change as the market emerges, but it is most likely to occur in the following steps.
Tariff Arbitrage

In many international markets, particularly highly regulated ones, communications carriers have tariff structures that are artificially high as compared with deregulated markets. Additionally, these markets generally offer lower tariff structures for data connections. A number of startups have begun to exploit tariff disparities and provide users with significant savings on their long distance charges. Internet phones and voice-over-IP (VOIP) gateways, two products designed to exploit these disparities, are discussed later in this paper. Tariff arbitrage products are purely tactical infrastructure plays, which will be short-lived as the international communications carrier markets embark upon a process of deregulation over the next two decades. As artificial tariff disparities evaporate, the value proposition will implode. Vendors who hope to survive this transition must be able to rearticulate their value propositions using a new vocabulary.
Freedom of Choice

Todays market drivers for packet telephony focus around tariff arbitrage across the WAN.

In the future, data and voice convergence will facilitate new business processes, enabling people to work more effectively. Perhaps most

importantly, this technology will release customers from the limitations of proprietary solutions, allowing organizations to develop integrated voice and data applications tailored to their own needs, much as PC users today can build data applications using Visual BASIC. Already, a cottage industry has emerged to deliver object-oriented software tools that allow customers to develop their own IVR applications. These tools are just the beginning of what customers will be able to do for themselves under the packet telephony paradigm.
Plummeting Capital Costs

encing product, and NetShow, a video streaming product. These products will be on tens of millions of desktops over the next few years, giving users the capability to begin using voice over packet-based networks.
Intels Planned Obsolescence Strategy

Another market driver is the opportunity to slash acquisition and operating costs. In 1997, the capital cost of building a LAN telephony system was higher than the cost of building separate LAN and phone systems. Vendors who advocate such systems claim that the combined infrastructure can lower maintenance costs, but there is a decided lack of evidence on this point. However, the dynamics of this marketplace are about to change. Many proprietary PBXs are built on technology that is measured in decades. By contrast, the data networking industry runs on a very different metabolism. The LAN industry typically has 18-month product life cycles, and traditional LAN infrastructure equipment costs generally decline by 20 percent per year. Vendors building nextgeneration packet telephony products understand where costs are excessive and how to drive them down by employing higher levels of product integration and by using nextgeneration silicon technology. Horizontal players, such as 3Com, understand the power of open systems and how to exploit the dynamics of this new business model to achieve market dominance.
Microsofts Application Dominance

Intel is another determinant in this industry. Ever since the advent of AMDs reverseengineered 286 microprocessorwhich caught Intel napping and forced a violent migration to 386 technologyIntel has embarked on a planned obsolescence strategy. A result of this phenomenon is a biennial (quickly becoming biannual) wave of new PCs with triple the power of their predecessors. Intel is also driving new applications, especially heavy users of microprocessor power, onto its platforms. Intel can be expected to support the widespread adoption of real-time voice and video, because it will force a new upgrade cycle using microprocessor technology that only Intel can provide.
Voice Connectivity over Data Applications

Microsofts application dominance and its applications proliferation strategy are also key market factors. Microsoft continues to bundle more capabilities in each new release of Windows software. One of its recent releases includes NetMeeting, a voice and data confer-

Just as global environmental change has extinguished some species and spawned new ones, the competitive environment in telephony is driving change. First and foremost is the proliferation of Web connectivity, which provides an alternative patha data pathinto organizations worldwide. Many organizations are using Web connectivity as a mechanism to reach out to their trading partners. Thus far, Web connectivity has been data oriented, but a few organizations are now experimenting with Web-based call centers, in which users can click on a screen object to obtain a voice connection to an agent. Another example of a promising voiceover-data application is the airline reservation system. Today, a travel agent having difficulty booking a reservation must call the airline over a special toll-free number, provide record information (such as a record locator) to the airline, and request special service. In the new model, the agent needing assistance could click on a help me button, and the application would bring up a voice connection to the airline. The airline representative answering

the phone would immediately be linked to the relevant customer record. This application would save time for both parties while eliminating the cost of a separate telephone call. This example illustrates the power of joined and simultaneous delivery of voice and data communications over an open, standardsbased fabric.
What Is Packet Telephony?

Enterprise Applications

There has been a lot of confusion regarding packet telephony in two specific areas. First, packet telephony is not Internet telephones. Internet telephones are software packages sold predominantly through retail chains for hobbyists to place telephone calls over the Internet. They are generally awkward to use and offer poor voice quality. Packet telephony is also not the same as computer telephony integration (CTI). As discussed earlier, CTI is the loose integration of computer systems with telephony switches. Packet or IP telephony is the simultaneous and joined delivery of voice and data communications over a single, unified communications fabric based upon the Internet Protocol (IP). Packet telephony traffic will be delivered within the enterprise over an organizations intranet and outside the enterprise initially over a circuit-switched fabric. Over time, as corporations develop extranets with their trading partners and as those partners install interoperable packet telephony systems, corporations will deliver packetized voice end-toend outside of the enterprise.
Carrier Applications

In the carriers, packet telephony is emerging as a key bypass technology. A new class of carriers, Internet telephony service providers (ITSPs), is building packet-based WAN networks to carry voice traffic. Even some traditional long-distance carriers are experimenting with packet-based WANs, primarily for service outside their regulated markets. New partnerships and consortia will emerge as these carriers attempt to create worldwide packet-based telephony networks.

In the enterprise, packet telephony will emerge in applications where the value proposition can be clearly articulated. This is likely to begin with specific applications in large organizationsapplications utilizing the joined delivery of data and voice over a single infrastructure. Examples include next-generation call centers, new voice logging systems, and unified messaging: the joined receipt of voice mail and e-mail. Because of its radical technological departure, packet telephony will emerge at the fringe of organizations in value-added applications, not in the core premises telephony fabric. Given the critical importance of the telephony infrastructure, telecom managers will be reluctant to move the core of their business onto a completely new technology until the technology proves itself. Much of packet telephonys present deployment is for toll bypass over WANs. Organizations are purchasing VOIP gateways to combine their phone and data infrastructures (or at least selected links in their infrastructures) primarily to high-tariff countries. Domestically, organizations with large branch office systems (such as banks) and a capillary data infrastructure to reach those branches are also exploiting the WAN data network to carry voice. In an odd reversal of the metaphor that sold T1 multiplexers for years (voice pays for the circuit; data rides for free), these customers have already installed and justified their data networks and are using spare capacity to carry intra-corporation voice traffic. Over time, as the business justification shifts to increased employee productivity and effectiveness, packet telephony will infiltrate the LAN fabric. Several events need to occur to effect this change. Much of the high cost of installing a LAN-based telephony system today lies in the infrastructure components (as opposed to telephone handsets or other client equipment). Within one year, these costs will reach a crossover point with traditional PBXs (Figure 6 on page 8), and within two years they will be at a 30 percent discount to PBX costs.

$800 End-user cost per seat Traditional PBX $600 IP telephony $400 UnPBX (key system knockoffs)

$200

Present

2000+

Figure 6. Packet Telephony Costs Will Reach a Crossover with PBX Costs

infrastructure to deliver their value. The dearth of true systems products in this market space is attributable to the lack of an end-toend, multimedia-ready IP packet infrastructure. Many 3Com customers are in the process of upgrading their entire fabric to support media-rich traffic, including voice and video. However, in the absence of a sizable installed based of media-enabled infrastructure, the packet telephony vendors are blocked from using the core of the data network and are left to deliver tactical products at the fringes. There are several broad categories of packet telephony products.
Toll Bypass Products

Another key issue is infrastructure reliability. Current LAN telephony systems use PC chassis for common infrastructure components. Many of these components lack redundancy, making the system vulnerable to component and system failure. However, a new generation of products built upon fully redundant, carrier-grade systems is coming to market. The 3Com Total Control remote access concentrator is one such platform.
Packet Telephony Standards

Four major organizations are working on various aspects of packet telephony standards: the International Telecommunications Union (ITU), the Internet Engineering Task Force (IETF), the European Telecommunications Standards Institute (ETSI), and the Institute of Electrical and Electronic Engineers (IEEE) under the auspices of its 802 committee. The ITU has developed the so-called H.32x family of standards related to video conferencing. Each H.32x standard pertains to a specific type of network, and refers to the appropriate subsidiary ITU standards for call processing, capability exchange, channel aggregation, media stream multiplexing, audio and video codecs, and data conferencing standards.
Packet Telephony Products

Toll bypass products sit on the edge of the network between a local PBX and a wide area packet network (Figure 7). An example is the VOIP gateway, which provides a VOIP connection between two or more PBXs over a packet-based network. The VOIP gateway packetizes voice and carries it across the private corporate intranet. The VOIP gateway is an outgrowth of voice over Frame Relay products, which perform a similar function over a Frame Relay backbone. 3Coms PathBuilder S600 access server offers voice over Frame Relay and voice over ATM support.
Internet Phones

As discussed previously, Internet phones are software packages that run on PCs and provide connectivity over an Internet connection. These consumer-oriented products can best be described as toyware or bundleware: free or nearly free software that delivers less than business toll quality. Although the hobbyist may be willing to tolerate these products, they are generally not business quality today.
LAN-Based PBX Systems

The packet telephony products being delivered today are largely tactical, self-contained products that rely only tangentially on a larger

A new product category is emerging that provides PBX capabilities over the LAN. The LAN-based PBX, which promises to substitute for and replace traditional enterprise PBXs, is a key ingredient to moving to convergence. Several startups are delivering voice switches that run on Windows NT. These switches create, manage, and tear down voice connec-

ch of Bran

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PBX te ral si PBX e Rela link y over Voice elay eR Fram way gate net Ether h it sw c

Cent

er Rout

Fram over Voice elay eR Fram way gate

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Figure 7. Toll Bypass Is the First Manifestation of Packet Telephony

tions between stations on the LAN. The stations themselves communicate peer-to-peer. The voice traffic between stations is digitized, placed into data packets, and transmitted across the packet network directly between the stations, bypassing the LAN-based PBX. For this class of product, the voice is transmitted in the packet domain. End stations involve the LAN PBX only when call control is required for instance, when transferring a call, creating a conference call, or sending a call to voice mail.
The UnPBX

A fourth product category is the UnPBX. These products are key system and small PBX knockoffs built around Windows NT servers. Unlike the LAN PBX, however, they do not use the data network to transport voice calls. Rather, they employ station cardsprinted circuit boards (PCBs) that have connections to stations (telephones), and trunk cards PCBs that attach to the public telephone network. Unlike the LAN PBX, the UnPBX operates entirely in the circuit-switched domain. The PCBs for these products are built in a PC Card form factor (usually PCI bus) and connect to each other using a Time Division Multiplexing (TDM) bus. The Windows NT

server is used primarily as a housing for the cards and to provide rudimentary connectivity to software applications, such as basic voice mail and auto-attendant, running on the server. The value proposition is aimed at key systems and low-end PBXs. This new generation of products is built on a open system that allows additional software applications to be written for Windows NT, a standard and easy environment. The station cards and trunk cards themselves, though built to a standard form factor, tend to be proprietary in implementation. However, standards are expected to emerge here, and costs will drop dramatically as production benefits from economies of scale. A major drawback of the Windows NT hybrid is limited scalability. Typically supporting a maximum of 150 users, these systems cannot easily scale past a single Windows NT chassis.
Related Products and Markets

The video-conferencing market is a technological cousin to packet telephony. To date, most video-conferencing systems have been large room systems that communicate point-topoint across the WAN. A family of standards called H.320 allows systems from different manufacturers to interoperate over Integrated Services Digital Network (ISDN) links. More recently, the concept of desktop video conferencing has emerged, allowing individuals to use this technology directly

from their desktops. The latest wrinkle is networked desktop video conferencing. When desktop video conferencing becomes networked, the infrastructure must change to allow users to dial, transfer, and conference video calls from their desktops. The networked desktop video-conferencing industry has converged on a family of standards called H.323. However, existing LAN infrastructures were not built to handle the demands of networked video conferencing.
Long-Term Trends

Finally, broadband access technologies such as cable modems and digital subscriber lines (xDSL) will also enable packet telephony. The broadband technologies promise to deliver huge amounts of data to the periphery of networks. They also promise to create a new category of utility providers. For example, Media One, an unregulated subsidiary of US West, is conducting trials of cable-based broadband services to the home as a means of faster Internet access. If they succeed, they will be ideally positioned to provide packet-based telephony services to their customers.
Building a Packet Telephony Network

Several long-term trends will drive the growth in packet telephony. The convergence of voice and data into open, standards-based platforms will provide an impetus for independent software vendors to develop voice- and dataenabled applications for increased effectiveness. Examples of these services range from unified messaging (the bundling of voice and e-mail) to the commoditization of voice mail and personal agent services such as Wildfire. Another trend is the delivery of telephony services transparently across packet and circuit-switched networks. As was discussed earlier, some of the early packet telephony players are exploiting tariff differences between voice and data for toll bypass, but this market will be short-lived as carriers become deregulated and pricing disparities collapse. Ultimately, users will not care how a call is transported, whether in the packet, circuit, or cell domain, so long as the call gets to the recipient with acceptable quality and at a competitive price. In fact, service providers may offer a range of services, with appropriate cost/quality tradeoffs.

To build an IP telephony system end-to-end requires three new types of components: a modified desktop, a gateway, and a gatekeeper (Figure 8). If multiparty conferencing is desired, a fourth component called a Multipoint Controller Unit (MCU) is also needed.
The Desktop

On the desktop, the user has one of two types of systems. Many users will have an Ethernet phone that plugs into an Ethernet RJ-45 jack. Other users, often those who use the phone extensively and in conjunction with a PC, will have handsets or headsets that plug into their PCs.
The Gateway

All LAN-based telephony systems today need to connect to the public switched telephone

orate Corp et n r t n i a itch PSTN

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Laye

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H.32

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Figure 8. Data and Voice Share a Common Local Infrastructure

g on unnin er r X B p LAN P gatekee 3 2 3 . H

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network (PSTN). Gateways are products specifically designed to convert voice from the packet domain to the circuit-switched domain. The gateway converts packetized voice (voice that has been digitized and placed into an Ethernet frame) to a format that can be accepted by the PSTN. Gateways support four types of connections: Analog T1 or E1 ISDN, generally Primary Rate Interface (PRI) ATM, at OC-3c and higher speeds Since the digitization format for voice on the packet network is often different than on the PSTN, the gateway will also provide this type of conversion, often called transcoding. Gateways also pass signaling information, including dial tone.
The Gatekeeper

The third major component is the gatekeeper. Although the nomenclature can be somewhat confusing, gateways and gatekeepers provide completely separate functions. The gatekeeper is primarily designed to throttle the origination of additional real-time connections over the network. Real-time applications register themselves with the gatekeeper before attempting to bring up a session. The gatekeeper may rebuff a request to bring up a session, or may grant the request at a diminished data rate. This is most relevant for video connections, which can consume vast amounts of bandwidth for high-quality connection. Packet telephony call control, call management, and voice switching intelligence will also reside in the gatekeeper.
IP Fabric

A robust packet infrastructure is required to support IP telephony and other real-time applications. At a minimum, switched 10 Mbps Ethernet to the desktop is required. The switches themselves must be nonblocking and support multiple internal queues. Telephony calls traversing the intranet will go through a Layer 3 switch, which will need to support multiple queues and Quality of Service features such as IEEE 802.1p, 802.1Q and Resource Reservation Protocol (RSVP).

Voice quality is most affected by transmission delays across the fabric, which cause gaps in the conversation when one party stops talking and the other begins speaking. Delays are introduced at a number of points in the network. One source is the encoding of voice from analog to digital. This conversion delay is exacerbated by voice compression algorithms, which require large samples of the voice stream before compressing and packetizing it. A similar delay occurs at the remote end when the voice is converted back to analog. Additional delays are incurred as the packet propagates through the packet network, though as long as the packet remains on a LAN with wire-speed switches, the propagation delay is minimal. At the LAN/WAN edge (the router, Layer 3 switch, or other access device), however, there can be considerable queuing delays because of the speed disparities between LAN and WAN. A more vexing problem occurs because of the variability of delay, also called jitter. Jitter delays occur primarily because of traffic conditions on the backbone network. One particularly troublesome problem is head-of-line blocking. If all packets arriving in a switch (or router) are treated with the same priority, a voice packet can get stuck in queue behind other, less time-critical packets. But the next voice packet traversing the network might not incur the same delay. The result is an accordion effect, where several packets arrive over a large interval or, conversely, in quick succession. Without appropriate design, this can wreak havoc on a telephone conversation. A number of techniques have been developed to address this problem. One technique is to use jitter buffers to smooth out the ebb and flow of packets. However, jitter buffers, which store a string of packets, introduce additional absolute delay. A third problem is packet loss. Most end stations using data connections are designed to accept and recover from an occasional lost packet. Unfortunately, the human ear is not so tolerant. Unless the network employs specific countermeasures, such as forward error correction or error concealment, users will hear

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annoying gaps and clicks. The effect on users depends upon the packet loss rate and the compression algorithm used. The higher compression schemes are less forgiving.
Key Market Issues

The packet telephony market today is embryonic. Most products have proprietary implementations; very few use VOIP standards, because the standards themselves are in flux. As a result, different vendors products are not interoperable. The industry is working feverishly to deliver a business-quality product, and given the multi-billion dollar market opportunity, there is little doubt that such products will emerge rapidly. 3Com has introduced a business quality solution in its Total Control remote access concentrator, a carrier-class platform that features high reliability and redundancy.
Where Is the Technology Going?

Data networking technology is becoming increasingly pervasive, ubiquitous, and essential. LANs have already spread out from niche applications in the enterprise, across the enterprise, to medium and small businesses. The next wave of technology promises ubiquity of data networks in the home. As this common transport permeates our society, it will become a key medium for carrying voice. Another trend is the rapid improvement in technology. The initial packet telephony implementations are appropriate for pilot and trial networks. A new generation, shipping shortly, will bring the quality and reliability up to business standards. The capabilities will continue to improve rapidly, driven primarily by rapid improvements in digital signal processing technologies, which are key to converting voice between the packet- and circuitswitched worlds. Correspondingly, costs will plummet as manufacturers deliver production volumes. A third area of improvement is deployment of QoS and policy-based management

capabilities over the IP fabric. 3Com and other manufacturers are beginning to deliver next-generation product portfolios that support bandwidth reservation, multiple classes of service, quality of service, and other features required by telephony and video applications. Another trend that portends the widespread deployment of packet telephony is the favorable competitive environment that will emerge over the next two decades, particularly for carriers. A recent treaty, driven by the ITU, lays the groundwork for deregulating service in the countries that comprise 95 percent of the worlds long-distance market. That phenomenon, in conjunction with the telecom free-for-all in the United States and the desire of alternative service providers to penetrate all markets including access to the home, promises to drive a huge market in packet telephony. In fact, one Dataquest analyst recently predicted that long-distance costs would drop from an average of five cents per minute to one cent per minute for IP connections. For many businesses, however, real value will be obtained not by lower long-distance costs, but by the benefit of delivering voice and data together, enhancing worker effectiveness and productivity. Additionally, packet telephony lays the framework for multimedia communications such as desktop video conferencing, enhancing the productivity of collaborating groups of people through rich communications. We are on the verge of a new era. Packet telephony will drive an explosion of communications between individuals and between collaborating workgroups worldwide. The tools, and the tools to build the tools, that are being created by a unified, open communications architecture will create an environment that fosters competition and encourages independent application providers. Driven by packet telephony, this revolution will lay the foundation for corporations to work in innovative, productive, and effective ways.

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3Com Nordic AB
Denmark Phone: 45 39 27 85 00 Fax: 45 39 27 08 44 Finland Phone: 358 0 435 420 67 Fax: 358 0 455 51 66 Norway Phone: 47 22 58 47 00 Fax: 47 22 58 47 01 Sweden Phone: 46 8 632 56 00 Fax: 46 8 632 09 05

3Com Latin America

U.S. Headquarters Phone: 408-326-2093 Fax: 408-764-5730 Argentina Phone: 541 312 3266 Fax: 541 314 3 3329 Brazil Phone: 55 11 5181 0869 Fax: 55 11 5182 7399 Chile Phone: 562 633 9242 Fax: 562 633 8935 Mexico Phone: 525 520 7841 Fax: 525 520 7837

3Com Asia Limited

Beijing, China Phone: 8610 6849 2568 Fax: 8610 6849 2789 Shanghai, China Phone: 86 21 63501581 Fax: 86 21 63501531 Hong Kong Phone: 852 2501 1111 Fax: 852 2537 1149 India Phone: 91 11 644 3974 Fax: 91 11 623 3192 Indonesia Phone: 6221 572 2088 Fax: 6221 572 2089 Korea Phone: 82 2 319 4711 Fax: 82 2 319 4710 Malaysia Phone: 60 3 732 7910 Fax: 60 3 732 7912 Pakistan Phone: 92 21 5846240 Fax: 92 21 5840727

3Com Canada
Calgary Phone: 403 265 3266 Fax: 403 265 3268 Montreal Phone: 514 683 3266 Fax: 514 683 5122 Toronto Phone: 416 498 3266 Fax: 416 498 1262 Vancouver Phone: 604 434 3266 Fax: 604 434 3264

3Com Russia
Moscow Phone: 007 095 258 09 40 Fax: 007 095 258 09 41

3Com South Africa

Phone: 27 11 807 4397 Fax: 27 11 803 7405

3Com France
Phone: 33 1 69 86 68 00 Fax: 33 1 69 07 11 54

3Com Northern Latin America

Miami, Florida Phone: 305-261-3266 Fax: 305-261-4901 Colombia Phone: 571 629 4110 Fax: 571 629 4503 Venezuela Phone: 582 953 8122 Fax: 582 953 9686

3Com UK Ltd.
Marlow Phone: 44 1628 897000 Fax: 44 1628 897003 Manchester Phone: 44 161 873 7717 Fax: 44 161 873 8053 Edinburgh Phone: 44 131 240 2900 Fax: 44 131 240 2903

3Com GmbH
Munich Phone: 49 89 627 320 Fax: 49 89 627 32 233 Austria Phone: 43 1 580 17 0 Fax: 43 1 580 17 20

1998 3Com Corporation. All rights reserved. 3Com is a publicly owned corporation (NASDAQ.COMS). 3Com and SuperStack are registered trademarks of 3Com Corporation or its subsidiaries. PACE, PathBuilder, and Total Control are trademarks of 3Com Corporation or its subsidiaries. Windows and Windows NT are trademarks of Microsoft. Wildfire is a trademark of Wildfire Communications. Other brand and product names may be trademarks or registered trademarks of their respective owners. All specifications subject to change without notice.

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