Survey: VoIP Can Save Enterprises From $9,600 To $28,000 Per Site

Survey also finds that ShoreTel and Nortel offer the lowest start-up costs, while Avaya and Cisco prices were the highest.

November 17, 2004

2 Min Read
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A new study has found that it costs an enterprise between $525 and $1,512 per user to implement VoIP, but the eventual savings can be substantial, ranging between $9,600 and $28,000 per site annually for large enterprises. The study also found that ShoreTel and Nortel offered the least-expensive start-up costs, while Avaya and Cisco prices were the highest.

The study, "Convergence: Reality at Last," by Nemertes Research, asserts that startup costs are dependent on a number of variables, include enterprise size and which vendor companies chose to supply the VoIP solution. It found that size does matter, and that the average initial cost of a VoIP deployment, including hardware such as IP PBXs and handsets as well as planning an implementation services, was $525 per user in deployments of 1000 users or more, and $763 in deployments of 100 users and less.

ShoreTel and Nortel offered the least-expensive start-up costs, while Avaya and Cisco prices were the highest. On average, according to Nemertes, companies spend $17,220 on network assessments, to determine whether their existing data networks are ready to carry voice traffic.

There are substantial cost savings to be had in VoIP for companies, though. The report note that large companies can save between $9,600 and $28,000 per site annually on local loop costs by converging their networks, and mid-sized enterprises can realize annual cost reductions of between $4,800 and $9,600. However, according to Robin Gareiss, Nemertes principal research officer and the report's author, enterprises have to be careful to consider the differences in real costs when planning a VoIP implementation.

"We find significant disparity between vendors when it comes to the true operational and capital costs to implement their products," Gareiss said in a statement. "It's vital for CIOs to understand those cost components and how they affect long-term convergence strategy."With all of the interest in converged networking, however, the Nemertes report finds that carriers are behind the market curve in providing managed services and hosted applications. "IT executives are getting impatient with the carriers," Gareiss said in a statement. "They haven't effectively marketed convergence services, so decision-makers usually don't even have carriers on their short lists." The report notes that about 80% of companies surveyed want carriers to improve their managed services, application hosting and wireless applications offerings.

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