VOIP

"VoIP: Threat or Opportunity to the Market Research Industry?"

Introduction

For those not familiar with the telecoms industry, VoIP is one of those acronyms much loved in the information and communications technology industries. Unlike many technical acronyms used by IT and telecom professionals, VoIP, or Voice over Internet Protocol, has the potential to radically impact on the operations of the market research industry.

What is VoIP?
VoIP allows broadband Internet users to make and receive voice phone calls over their Internet connection. A caller's analogue voice call is converted into a digital signal, bundled into data packets and sent just like any other information packet over the Internet to its destination. At the receiver's end, the packets are recombined and translated to speech again. VoIP calls largely or completely bypass the public switched telephone network (PSTN). Instead, they are carried wholly (or mainly) over Internet Protocol (IP) networks like the public Internet, an organization’s own IP wide-area network or the network of a telephone service provider that uses the Internet itself to carry calls.

Market researchers will use telephones in much the same way as they do now. However, calls will be made either via an IP Phone (which looks like a conventional phone but converts analogue signals to IP digital signals), or a normal analogue telephone connected to an analogue phone adaptor which converts the analogue signal to a digital one. Telephone numbers can be assigned and calls can be terminated onto the PSTN network. Users can talk to others who are not using VoIP and they retain the traditional voice call experience, i.e. they can use their existing CATI (computer assisted telephone interviewing) headsets to make IP calls.

What does this mean to an agency?
VoIP will affect an agency in three potential ways:
* It will lower the costs of telephone research
* It will lower the cost of running an agency by lowering all telephone bills
* It will improve the functionality and flexibility of an agency's communications, but it may make it harder to organize telephone research and build a representative sample

The opportunities: cost savings
VoIP essentially removes the cost of using the public switched telephone network (PSTN) to make telephone calls because the traffic is carried wholly or partly off the PSTN. It therefore reduces telephone and administration costs. Calls made between VoIP users are free. When calling others using a VoIP service, there is only a monthly service charge (often around GBP 6.00) but no call charges. Therefore, calls to respondents who are also using VoIP are free and calls between agency locations or to freelancers are free as long as all are using VoIP. Via a VoIP service, staff can also make and receive calls to and from ordinary non-Internet numbers and whilst these calls are not free, they are usually at significant discounts to regular rates.
Business-to-business (B2B) telephone research is increasingly open to the use of VoIP. The UK is amongst the leading countries in terms of the proportion of companies using VoIP. According to the DTI's (UK Department of Trade and Industry)

International Benchmarking Study 2004, in 2004 18% of UK businesses were using VoIP. Given that 65% of UK businesses have a broadband connection when accessing the Internet; this implies that 28% of UK business broadband users have VoIP. Within the UK, there is significant variation by sector - 44% of financial services use VoIP compared with only 10% of manufacturing businesses.

The proportion of consumers using VoIP is not clear, but broadband connections now exceed dial-up connections for Internet access and the consumer VoIP market is likely to grow strongly in the future, especially as many VoIP service providers are bundling VoIP services with broadband connections.

The opportunities: increased flexibility and functionality
VoIP is particularly attractive to research agencies. In contrast with other technologies - such as multiplexing, which allow data and voice traffic on the same line - IP telephony is more flexible, and can accommodate new working trends such as 'hot desking'. By using IP technology, companies can digitize communications, meaning emails can be forwarded to workers while they are on the move. It also opens the door for cheap video telephony.
VoIP offers:
* Increased employee mobility
* More intelligent call handling
* Greater flexibility
* New channels of communication.

Most VoIP service providers bundle a range of communications features into their standard packages allowing even small agencies to enjoy the benefits of sophisticated telephony services. Services aimed at businesses offer basic voice services plus a range of business user features, such as:
* Call redirect (to any other designated phone, to anywhere when no answer, immediately when an office is closed)
* Advanced voice messaging features
* Abbreviated dialing between locations
* Real-time billing
* Advanced call restrictions
* Integration of the VoIP services into the PC network, meaning companies can have features like parallel ringing, central web-based feature management, global corporation telephone integration, conferencing and an easy-to-use web interface to manage extension numbers and call groups.

The threats
While VoIP offers many operational benefits to research agencies, there are also dangers. A consumer or a firm using a VoIP service can be allocated either:
* A UK geographic number
* An 0845 number, which is usually slightly cheaper than a UK geographic number.
On the one hand, this can benefit an agency. Users can specify any UK geographic numbers regardless of where they live so, for example, a freelance teleworker in Spain can have a London telephone number. This might be advantageous to an agency working virtually but who wants to present a professional image to clients.

On the other hand, it decouples telephone numbers from geographic areas. Not only does a UK telephone number no longer point to a geographic locality within the UK, it no longer points to the UK anymore. UK nationals with a home in the UK but living in Spain for most of the year, for example, will have a UK telephone number which rings in Spain. These individuals are unlikely to be appropriate contacts for a survey about living conditions in the UK.

The traditional method of sample selection for a consumer omnibus survey would entail a random sample of telephone numbers being drawn from the entire BT database of domestic telephone numbers within each region. Each number selected will have its last digit randomized so as to provide a sample including both listed and unlisted numbers. In today's non-VoIP world this would ensure a representative sample, but in a VoIP world it may not. A number initially drawn from the South East region could turn out to be one from Scotland when the last digital is randomized - e.g. 0208519XXX1 might be from East London, but 0208519XXX3 might be from Glasgow, if the Glasgow household has chosen a London number.

Similarly, businesses operating from overseas but with a UK mailing address can also have a UK telephone number which rings in the overseas office. Are these appropriate contacts for a survey about business conditions in the UK?

Moreover, advanced call-handling features will complicate research. VoIP allows consumers to establish a separate number for each member of the family. One address can now have multiple numbers - unless each individual is identifiable by age and sex, which is the best number to call to reach the head of household, for example?
In addition, call-divert options allow calls to be diverted to another number on no answer or re-directed to other family members. During the holiday period, a call to family A could be answered by family B (neighbors or relatives) while family A is away. A telephone survey of London households, as an example, could be answered by a home in Manchester.

VoIP may also ironically add to telephone bills. Options like simultaneous ring mean that calls to the landline will ring simultaneously on a mobile as well - agencies call a landline but pay for a mobile call.
Finally, the curse of a B2B telephone researcher's life – voicemail -- will be commonly available to consumers, including personalized greetings. Households, tired of sales calls, can simply leave the phone on voicemail and only return those calls they want to answer.

Conclusion
VoIP could radically cut the costs of telephone research in the UK and will make an important impact on the operating costs of a research agency. However, like ex-directory numbers and the lack of 100% penetration of telephones into UK homes, it raises some interesting issues about how telephone research needs to be designed and conducted.

Useful Links
- General site for VoIP information in UK.
- Review of VoIP developmentsincluding list of service and equipment providers.
- Wiki covering software, hardware, serviceproviders, reviews.

- Good introductionsto VoIP