Making the most of your voice service

Since the launch of Voice over IP (VoIP), most providers have offered MVPDs bundled voice products, meaning that they sell voice services as an attractive white label “turnkey” solution. This solution includes a voice network, telephone numbers and long distance. Providers then charge for the service on a per-subscriber basis. At the time, this “plug-n-pay” solution made sense because it naturally fit into their consumer product lineup, required minimal resources to support and maintain, and shortened their time to market. However, as voice service and technology improve and become more accessible to MVPDs of all sizes, many are unbundling their current service in an effort to control costs and improve their customers’ experience and satisfaction.

There are significant benefits to be gained by unbundling voice services. For example, implementing least-cost routing (LCR) enables MVPDs to source multiple providers to terminate a call at the lowest possible cost per minute automatically as the call is initiated. Owning and operating LCR technology will pay off in time, especially if a carrier’s subscriber base voice usage is substantial. In addition, the LCR model allows MVPDs to move from the per-subscriber pricing model to a market-based, competitively-priced per-minute model. This move has resulted in substantial cost savings and increased profit margins for many MVPDs.

Another advantage to unbundling is the ability to control—and improve—the customers’ experience when MVPDs assume network management. In the bundled approach, should a single provider experience an outage, the MVPD is left without any options to complete calls until the provider resolves the issue. MVPDs that have unbundled and manage their own network, again through LCR, have some level of redundancy by receiving service from a variety of providers, and thereby improving the network quality, availability and overall customer experience.

The benefits of unbundling voice services are compelling, but there are some factors for an MVPD to consider when planning the move. First, what are the potential savings based on their subscriber base and the number of minutes per month they service? Second, what resources (money and personnel) will be required to assume more responsibility of the technology? (For example, supporting G7.11 and G7.29 codecs or interconnectivity to other voice network technologies (TDM, SIP, Public IP and GigE) may require additional expertise or expense.) Finally, what is the pay-back timeframe of up-front hardware costs to implement LCR?

When contemplating these considerations, keep in mind that many MVPDs have already found the cost benefit coupled with an improved customer experience to be two key advantages to an unbundled voice solution.