EDS Brings Bank of America Into the World of Convergence

The Bank of America project is part of an ongoing multibillion-dollar network outsourcing deal the bank signed with EDS in late 2002. EDS is charged with implementing and managing the network backbone as well as the VoIP phone installation in 5,800 locations across the United States.

The installation will eliminate more than 300 separate PBX systems and bring Bank of America onto a single Cisco IP Communications System. Craig Hinkley, senior vice president of network services at Bank of America, says the goal of the VoIP move is to enable the business to be innovative in the way it uses voice and data applications to execute business processes and interact with customers.

In addition, "the move to VoIP will provide savings and increase associate efficiency," Hinkley says. As for the behind-the-scenes planning, Hinkley says the bank provided EDS with a detailed list of requirements relating to the network architecture and strategic direction of its voice and data network.

EDS took those requirements, along with other business and financial requirements from the bank, and reviewed IP-telephony solutions in the marketplace, Hinkley adds. While Bank of America helped with the evaluation, Hinkley says EDS made the final decision and recommendations.

Ultimately, EDS selected the Cisco solution, which will be rolled out over an 18- to 24-month period, says Mike Littell, EDS enterprise client delivery executive for the Bank of America project. EDS also will be enlisting the help of SBC Communications for the installation.

"Cisco is a key strategic alliance partner for EDS," Littell says. "Cisco brought the knowledge and the technology of VoIP to the table, which was pleasing to both EDS and Bank of America."

And with big-name enterprises paving the way, VoIP is poised for SMBs, as well.

"I believe VoIP is going to move almost concurrently into the SMB space," says Gordon Martin, vice president of communications portfolio at EDS. "There are lots of advantages; the solutions don't get as complex as the major implementations."

Rick Moran, vice president of product and technology marketing for IP communications at Cisco, agrees. "The large wins signal more and more general public acceptance of voice over a structured IP network and will make it easier to go into the smaller and medium-sized businesses," he says.

Mark Hilz, president of Dallas-based InterNetwork Experts, an IP solution provider focused on IP communications for the midsize to large enterprise market, says that for VoIP, the question is no longer if, but when.

"Before, there were a lot of questions about if this technology was going to work," Hilz says. "With the number of installations we have to reference, the 'if' is taken out and the customer is only pondering the 'when.'"

Now, it's a timing issue, he adds. "It's an internal decision for an organization—what's the right time?" Hilz says.

Another sign the tides have changed in favor of VoIP: Hilz says he has seen the typical sales cycle shrink from six months to a year to around 90 days.

In addition, Hilz has seen his revenue grow from $2 million in 2000 to roughly $80 million in 2004. "In four years, that's a pretty healthy growth rate," he says, adding that customers are looking for a provider with experience and solid, successful implementation references.

According to Gartner, IP telephony is on the rise and will continue to penetrate the market. In 1999, IP-telephony systems accounted for just 1.4 percent of total business telephony equipment sales, but in 2003, IP-telephony equipment increased its market share to 56 percent of all sales; by 2007, it is expected to account for 97 percent of all business telephony sales.

In terms of dollar amounts, Gartner Dataquest estimates that North American companies spent roughly $2 billion on IP-telephony systems last year, with that number expected to more than double to $4.2 billion in 2007.

Customers are also looking for support and applications to layer on top of their IP networks, Hilz says. "It's not just about implementing and walking away, leaving the customer short on the support side," he says. "We show the customer what levels of support they would need and what kinds of applications they can layer on to enhance the ROI of their solution."

Hilz sums it up: "I can't imagine too many medium to large enterprises considering buying a traditional PBX system anymore. No one is even making brand-new traditional PBX."

Steve Koppman, principal analyst of communications at Gartner, agrees that IP telephony is hitting the mainstream, with vendors somewhat driving the move as they are no longer upgrading traditional telephony equipment.

Koppman adds that one of the main drivers for VoIP and the move away from traditional PBX is cost savings.

"Up front, it may cost more, but over any reasonable period of time there should be cost savings," he says, adding that efficiencies are also key as VoIP makes it possible to combine voice, video and data onto one network.

Looking to the future of VoIP and expected demand, Cisco recently reorganized its certification categories to better help customers, defining them by size of market they can effectively serve.

"This way, we can help customers get the right level of specialization," Cisco's Moran says.