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Telecoms conquering their fears of open source

Telecoms looking for service revenue turn to open source as enterprises demand SIP trunking and support for Asterisk PBX.

Long wary of open source software, major telecoms are now experimenting with bringing offerings like Asterisk PBX into their peripheral services as enterprise demand for open source compatibility and SIP trunking increases.

Telecoms have traditionally shied away from open source because of its perceived lower stability, lack of long-term support and sparse offerings. Instead, most service providers have chosen to use the proprietary software generally bundled with the infrastructure hardware they buy.

However, enterprises have been leading a quiet revolution, using open source software in their own networks to help them migrate to IP telephony. Now those enterprises want their carriers to support open source.

"In communications, there seems to be just a couple of niches where open source gets traction," said Bern Elliot, a research vice president with Gartner Research Inc. Asterisk and SIPFoundry, two open source PBX technologies, are the most prominent projects in telephony.

Asterisk began simply as a drop-in PBX replacement, but SIPFoundry integrates session initiation protocol (SIP) adoption throughout communications. Both use SIP trunking and are popular among enterprises as an inexpensive way to roll out a phone system.

Digium Inc., the corporate maintainer of Asterisk PBX, earns revenue by selling Asterisk-compatible hardware. It has been a popular model, leaving a large demand for Asterisk-related services, which Digium has not focused on as much, that service providers could tap into, according to Digium's Bill Miller, vice president of marketing and product development.

Miller estimated that, as of last summer when he did an informal survey of providers, service providers used Asterisk to connect 890,000 SIP and AIX phones, and he expects that number to grow substantially.

Both AT&T and British Telecom have approached Digium after receiving requests from their customers to offer SIP trunking, according to Miller.

"Resellers want a complete solution: a circuit, a PBX and the complete set of applications," Miller said. Asterisk's versatility means it can fit into a variety of offerings while leaving plenty of areas for value-added differentiators on the service side.

"We meet and talk to all the big players and, in some cases, they use Asterisk as an element of their solution. But it's not the core of their solution," he said. "Asterisk is not designed for that, but you will find it in the middle of a lot of these things, sometimes just for testing."

Elliot said open source applications offer two major advantages to telecoms. Lower cost is one advantage commonly associated with open source. Elliot said customers generally don't care how a service or product is offered as long as it is reliable and high quality. By switching away from costly proprietary services, providers can cut annual or per-user licensing fees.

The other advantage is in keeping more support – and support-related revenue -- in-house. Elliot said it was easier to bring in and train open source expertise, as proprietary vendors frequently monopolize the markets for their services. With support often making up 15% of a PBX's annual cost, according to Elliot, the more support services that providers can keep internal, the better they will do.

Elliot suggested that service providers begin with a basic open source support model where they handle all customers' Tier 1 and Tier 2 issues internally. They should partner with specialized open source vendors like Digium to handle higher-level support issues.

"That would be attractive if it came in at the right price point," he said.

Some barriers to open source adoption remain. While many end-solutions are open source, not much in the network infrastructure is at this point. Elliot also noted that truly innovative service offerings would likely remain proprietary, as their edge remains valuable as a differentiator.

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