SWITCH TO INTERNET-PROTOCOL TELEPHONY FOR SAVINGS
COULD ACTUALLY ADD TO COSTS

Telecom Cost Control Expert Recommends
Accurate Telcom Assessment To Determine Costs and Benefits

St. Paul – March 8, 2004 -- With telecommunications now among business’ top five costs, companies may be eager to adopt Internet-Protocol Telephony (IPT), or Voice over Internet Protocol (VoIP), to slash telecom bills. But an expert in helping companies control telecom spending warns: Don’t leap without a hard look at the true costs and benefits.
      “Rushing blindly into IPT could cost you,” says Steve Lambros, chief executive officer of Coeus.
     Implementing IPT without a thorough assessment, Lambros says, “can result in over-configured networks, overlooked services and continued payment for services that are no longer needed.
     “Businesses may end up sacrificing IPT’s potential savings or creating costly network disruptions if they don’t first accurately assess their current telecom assets and how they’re being used, the terms of telecom vendor contracts and whether they’re paying only for the services they’re using,” said Lambros.
     “The assessment needs to be based on detailed, specific information about telecom usage and costs,” he said. “Most companies rely on general information, which can lead to misguided decisions.”
Before investing in new Internet-based voice capability, Lambros recommends digging for answers to several key questions:

      · What are the business reasons to move to IPT? What business applications will be better served by the move? Will the change create true efficiencies? “Toll avoidance may be one reason to consider IPT. But the value the technology adds varies by the applications being used. If the applications are not better served by IPT, then any cost savings could be sacrificed in service reductions,” said Lambros.
      · Will the existing local area network, cabling infrastructure and building electrical and HVAC systems support the requirements of IPT, which are more demanding than those traditional voice systems? What additional investments may be needed to upgrade routers, switches and the cabling infrastructure? How will IPT impact IT staff? Do you have the tools to manage the increased demands of IPT, including the knowledge and tools to monitor quality of service. “Without precise answers to these questions, companies may be in for a surprise at the cost of this ‘money-saving’ technology,” said Lambros.
      · What are the true costs of existing telecom assets and services? “It sounds like a question every business should be able to answer,” said Lambros. “In fact, few can.” Billing complexity, the difficulty of reconciling telecom bills against vendor contracts and the reality that there’s little accountability when it comes to telecom spending are among the factors that prevent companies from gaining an accurate picture of their telecom costs.”

     “Yet,” Lambros says, “before investing to IP telephony to save money, an accurate assessment of existing telecom services may find that significant savings can be gained by simply eliminating waste.” Lambros says his firm typically finds savings averaging about 26 percent for his customers when he assesses their spending. “If you can save 26 percent by optimizing telecom costs, why spend more on new technology that might only save 15 percent?”
     A precise accounting of current telecom expenses can pay off down the road as well, says Lambros. “When telecom vendors make lofty promises about return on investment, you’ll be able to determine whether the technology or service performed as advertised. Accurate performance information is the ammunition you need to hold vendors accountable.”
     St. Paul-based Coeus, Ltd., helps companies dramatically cut their telecommunications costs. Going beyond the typical snapshot audit of a company’s telephone, wireless, data and Internet services, Coeus (www.coeusinc.com) provides the process improvement, tools and services that manage business telecommunications assets for long-term cost control.

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