Beware VoIP Pitfalls
While VoIP has its advantages, there are also some things to watch for. State says one thing he's had to deal with is the rapid number of upgrades. "That's the only thing we experienced from the negative side, but it's nothing we can't handle."
Additionally, because the phone system is IP-based, security is an issue, and firms run the risk of attacks and viruses that could impact their telecommunications. But the security concerns are no different than those with other critical applications that run on the network -- it needs to be monitored and protected like any other application.
"We've always been very attuned to security," Cantor's Claus says. "The addition of IP telephony into our network hasn't changed anything we're doing other than heightened our awareness," he continues.
Because the technology is still young, there's also room for improvement when it comes to product offerings. "I think the feature sets are not as rich yet," State says. But he expects that will quickly change as more firms adopt VoIP and vendors develop new services around it.
So, will VoIP be the death of TDM-based PBX? "I don't think so," says James Parker, vice president of product development at Transaction Network Services in Reston, Va., which provides voice transport solutions to the financial-services industry. "It will take years to replace."
What that means, says Peter Skoglund, director of product management and systems engineering at trading turret maker BT Syntegra in New York, is that the financial-services industry will operate in a hybrid mode, with a blend of IP telephony and traditional TDM telephony. "Hybrid gives you the best of both worlds," he says, including the "five-nines reliability [available 99.999 percent of the time] of TDM" and the VoIP best practices and flexibility.
Greg Kenepp, president and chief operating officer of trading turret maker IPC in New York, says, "A large percent of [financial services] is still driven off legacy technology. What the industry is going to face is a period where we have a hybrid environment, and we're entering that now." He expects the hybrid period to last between five to seven years.
Dan Wagner, CIO and executive vice president of business structure at New York-based Global Crossing, which provides hoot-and-holler services to trading firms, says, "It's impossible to do a complete swap-out." So hybrid systems are a logical step. He says firms want to make the shift to VoIP "as seamless as possible."