Pseudowire: 
Relief for Call Center Network Migration Pains

By Larry Jacobs

September 2006

Conventional wisdom says that as contact centers distribute their workload to remotely located centers or through links to outsourced facilities, new communications network technologies - especially VoIP (Voice over Internet Protocol) - can vastly improve their efficiency and keep costs down. 

The migration to VoIP networks, in which all data traffic and voice calls are carried over the same network infrastructure, is one of the biggest trends among corporations worldwide.  Eliminating the parallel networks used by so many organizations, with one network exclusively for voice and the other for data, converging them into one reduces network costs, equipment costs, and ongoing maintenance.

For some contact centers, however, there is a hidden cost to this migration.  As efficient as these new networks may be, thanks to their ability to carry all traffic over standardized packet network connections, there is one thing they cannot do.  They cannot handle the voice traffic from traditional, or legacy, equipment such as PBXs, automatic call distributors, or predictive dialers.

Traditional equipment transmits voice calls in a TDM (Time Division Multiplexed) format that is not compatible with new IP packet networks.  As a result, moving to these new networks typically requires the purchase of new voice equipment, a huge investment for a contact center operation.  That is a big enough hurdle to keep many companies from migrating to an IP network and taking advantage of its benefits.

Fortunately, an oddly named technology - pseudowire - has been developed to allow traditional voice equipment to communicate, in its own "language," over IP networks.  It functions like a special channel, or wire, through the IP network, that carries the TDM traffic between PBXs or other traditional equipment.  It takes the traditional voice traffic and segments and compresses it into packets that are accepted by the IP network and carried to their destinations.  Once received by the pseudowire equipment at the far end, the original voice traffic is reconstructed and delivered to the PBX/ACD in the format that it understands.

Rather than have to abandon their traditional voice equipment, contact centers can take advantage of pseudowire to continue to get their money's worth out of the equipment in which they have considerable investment.  When they feel they have fully leveraged their investment, then they can purchase IP-ready gear.  Pseudowire buys the time needed for a contact center to make an unforced decision about when their traditional equipment needs replacing.

Two companies that faced this type of network migration decision and have been using pseudowire effectively are TecNet and Teleperformance USA.  TecNet is a subsidiary of TEC (Telephone Electronics Corp.) and provides interexchange carrier and international call center services, through shared usage call centers in countries such as India and the Philippines.  As it added international voice trunking capacity to accommodate growing remote call center applications, TecNet saw pseudowire's potential for further reducing expenses through voice compression.

Installing pseudowire equipment enabled 16:1 compression - twice as many calls per circuit as it had been getting.  TecNet doubled its capacity without additional line charges.  The result was savings of about $96,000 per year for each voice circuit. 

Teleperformance USA had similar success.  As one of the largest contact center outsourcers in the U.S. , it was looking to expand its offshore operations in Argentina and the Philippines and set up centers that could handle hundreds of simultaneous calls serving the U.S. market.  The company's operations centers in Salt Lake City and Seattle installed pseudowire equipment and gained cost-saving 16:1 compression on its international circuits.

Teleperformance USA was able to put its offshore centers into operation quickly and keep control of its telecommunications costs.  Although the company still uses traditional circuits for its voice traffic, it is in the process of migrating to an IP network, an easy process since the pseudowire equipment is already in place that can handle either TDM or IP WAN connections.

Pseudowire can also be used to establish a backup connection for a remote call center.  This can be an IP network backup for a traditional T1 or E1 connection, or vice versa, with a traditional circuit backing up a new IP network.

The voice compression capabilities of the pseudowire equipment are of particular interest to contact centers whose networks include offshore centers.  Unless it is controlled, the high cost of international leased lines can wipe out the savings gained by locating a center offshore.

For instance, if one circuit to India costs $5,000 a month, and that circuit is capable of carrying 30 simultaneous telephone calls, a contact center operator might need 10 such circuits - at a hefty $50,000 a month - to guarantee capacity for a 300-agent call center.  Pseudowire's 16:1 compression makes it possible to more than meet that center's needs using just a single circuit.

Telecommunications costs are a significant part of most any contact center operation's ongoing budget.  Keeping those costs down through a migration to IP networking is a sensible strategy.  With pseudowire available to keep traditional equipment from becoming an obstacle, there is no reason to resist what is essentially an inevitable evolution.

Larry Jacobs is vice president of marketing for RAD Data Communications.  He has more than 20 years of experience in defining, developing, marketing, and managing high-tech telecommunications and data networking products.