Level 3’s Sunsetting of Legacy TDM Services Heralds Major Shift to IP

Although the shift from TDM to IP networks among Telecom Service Providers has been underway for some time, it seems that the slow speed of the transition has been noted almost nearly as long.  However, now, a variety of factors show an acceleration of this evolution, including quite notably the news in early June that Level 3 Communications has requested that the FCC allow it to phase out certain elements of its legacy voice services in the Portland, OR metropolitan area.  This is a significant milestone because of the critical role that Level 3 plays in the nation’s core communications infrastructure and as a provider of IP and other utilities to medium-to-large Service Providers in the US and around the world.  It also serves as a warning to Service Providers that it’s time for an upgrade, either through investment in IP capable infrastructure or by switching to an IP-based, hosted solution.

Given its inherent advantages with regards to provisioning services beyond pure voice — instant messaging, video conferencing, presence, and more — it’s no surprise that a transition to an all-IP telecom infrastructure has accompanied the proliferation of Unified Communications, and long been seen as a natural next step in a telecommunications environment in which voice is increasingly becoming one tool among many.  To date, a variety of factors have limited this transition, the most significant of which, from a Service Provider’s perspective, have been the investment required to achieve a wholesale change of the technology underpinning TDM networks and the perceived unreliability of VoIP.  Smaller Service Providers, for example, who continue to use SS7 to provision feature-capable voice services, have held up the transition process because of that older signalling protocol’s dependence on TDM.

Over the past several years the profitability and ubiquity of the auxiliary services to voice — mentioned above — have grown, and concerns about reliability have been addressed through advances in denser network architecture and material advances in the technology.  The tipping point has come closer and closer, and after several years of indications that a core infrastructure level change is coming — Verizon filing to cancel its postpaid card and 800 number service, AT&T proposing plans to test phase-outs of DSL in favor of mobile data, AT&T and TelePacific agreeing to a TDM-to-IP transition plan — it appears to have finally arrived.

This move is significant because Level 3, a Tier 1 provider of telecommunications infrastructure and significant supporter of ILEC’s in the west of the country, has historically made enormous investments in TDM hardware and provisions voice over TDM to a very large number of Service Providers and end-users.  If its request is approved by the FCC (see the filing here), Level 3 will sunset TDM services in Portland by the end of August, compelling all of the Service Providers it supports in that area to switch over to IP prior to this deadline or face service disconnection.  The importance of this step is reinforced by a recent FCC vote that makes it easier for Service Providers to retire copper lines, essentially facilitating the process.

Retiring TDM points towards a situation in which an ever increasing portion of telecommunications infrastructure is strictly IP-based.  In such an environment, business end-users relying on traditional, TDM-based phone systems will face mounting pressure to transition to IP-compatible systems.  What sort of transition will be right for each individual enterprise will depend on their particular circumstances, but generally two options present themselves: retain legacy TDM equipment and connect to the IP network with a SIP trunk, or transition fully from TDM to a Hosted PBX or Unified Communications as a Service solution.  Infrastructure-driven pressure on businesses for a transition to either of these solutions is an opportunity for Service Providers, who, by provisioning SIP Trunking, Hosted PBX and UCaaS to businesses, can capitalize on a very public embrace of VoIP to accelerate the adoption of next generation communications technology among their clients and prospects.

Posted Under:VoIP Logic Blog