VoIP in finance: Networks too 'rickety'

Financial-services companies are eager to embrace emerging technologies such as IP telephony for the business benefits they offer, but their networks are often not up to the task, according to a new report from consultancy BearingPoint.

The report, titled Making the Leap to the Next Generation, reads: "The global networks of many financial-services firms and other enterprises are 'networks of networks' cobbled together through mergers and acquisitions. The result is often inefficiency, high cost, inadequate disaster recovery and an inability to deliver new bandwidth-intensive applications."

These "sometimes rickety" networks consist of multiple systems from multiple vendors that are patched together with "Band-Aid solutions" and cannot provide the bandwidth or quality of service for applications such as IP telephony, video conferencing, webcasting and network-based training, BearingPoint says.

Sometimes the only solution is to start from scratch and build a "next-generation network."

There are many benefits to such a strategy, including reduced costs from a streamlined and efficient network, added value through the ability to support applications such as VoIP and grid computing, improved disaster recovery, greater scalability and the ability to compartmentalize and thus outsource network layers, according to the report.

However, upgrading or replacing networks across a global company is no easy task, often involving negotiations with multiple vendors. Still, BearingPoint says that for large global organizations, the benefits of setting up a new network could outweigh the complications. Those benefits, BearingPoint notes, include an improved customer experience.

In particular, the firm says, organizations are realizing that VoIP applications are no longer a commodity and "can strengthen their relationships with customers to give them competitive advantage."

Sylvia Carr of Silicon.com reported from London.