S T R A T E G I C W H I T E P A P E R

Transforming Networks with SIP Trunking

Enabling cost-effective communications and new services
for small and medium businesses (SMBs)

The Internet is critical for SMBs. They use it for e-mail, to publish information online and
for e-commerce. But SMBs have been hesitant to adopt the Voice over Internet Protocol
(VoIP) communications that the Internet enables.

Now, a combination of public network transformation, new information and communi-

cations technology (ICT) solutions and Managed Communication Services is setting the
stage for SMBs to migrate to a single IP network connection that enables cost-effective
VoIP communications and innovative, converged services.

This paper provides an overview of the drivers behind the SMB migration and explores the
technological and business advantages of using Session Initiation Protocol (SIP) trunking
to connect directly to service provider networks and leverage next-generation network
(NGN)/IP Multimedia Subsystem (IMS) transformations.
Table of contents
1 Executive summary: A new era for SMB communications

1 The drivers behind SMB transformation

2 Technology and business drivers
3 NGN/IMS and the SMB evolution to a single IP connection

5 The options and benefits of IP/VoIP for SMBs

5 Gateway solutions versus SIP trunking
7 From SIP trunking to SIP peering and IP peering

10 Alcatel-Lucent Office Communication Solutions and SIP trunking

11 Conclusion: The time for SIP trunking has arrived

12 Appendix A
12 More about SIP
13 SIP registration

14 Abbreviations
Executive summary: A new era for SMB communications
Information and communications technologies (ICT) allow small and medium businesses (SMBs)
to improve and develop the services they offer their customers. In fact, the Internet Protocol (IP)
and the Internet have already changed the way SMBs work. They communicate via e-mail, publish
information online and use e-commerce solutions to better serve their customers. However, unlike
residential users and large enterprises, SMBs have yet to adopt IP technology for telephone services.

This situation is changing as service providers are now providing IP connections that support the
Internet, Voice over Internet Protocol (VoIP) and new services. As a result, it is expected that SMBs
will demand more comprehensive solutions that combine information technology (IT), the Internet
and telephone services and allow them to access new multimedia services.

In the near future, a single IP connection between the SMB and the service provider will be the
norm. This connection will support the VoIP, Internet and multimedia services made possible by
the next-generation network (NGN)/IP Multimedia Subsystem (IMS) network transformation in
which service providers in every country are engaged.

In fact, forecasts based on data from Alcatel-Lucent and analysts indicate that by the year 2013,
only IP connections will be offered to SMBs (see Figure 4). At a technological level, it will change
the way IP-Private Branch Exchanges (IP- PBXs) interoperate with the public IP network. At a
higher level, it will change the way SMBs do business.

To simplify communications while controlling costs, SMBs should look to the Session Initiation
Protocol (SIP), the preferred protocol for VoIP services. SMBs can replace their Public Switched
Telephone Network (PSTN) trunk with a SIP trunk to benefit from low-tariff VoIP calls and inno-
vative new services. SIP trunking also brings the infrastructure to support further evolution toward
end-to-end solutions between customer premises equipment (CPE) and the network applications
enabled by NGN/IMS technologies. And it is a first step toward SIP and IP peering between the
SMB environment and the service provider network.

Alcatel-Lucent has developed a robust SIP trunking solution that is fully aligned with service providers’
NGN/IMS deployments. This solution will help service providers support SMBs that want to trans-
form their networks to take advantage of IP-only connections and SIP technology.

The drivers behind SMB transformation

Before delving further into the drivers behind SMB transformation, it is important to define the
characteristics of these businesses.

SMBs are companies with five to 200+ employees. Most have fewer than 60 employees and three
out of four have fewer than 20 employees. They typically report less than 50 million euros (approxi-
mately 77 million United States dollars) in annual revenue. SMBs tend to be larger in North America
than in Europe. They are often organized around the owner, with flexible operations and informal
job descriptions. Most of the skill sets within an SMB are related to the industry in which the SMB
operates. As a result, they often lack ICT skills and organization.

SMBs tend to be ill-equipped in terms of VoIP and IP telephony. In 2007, less than 15 percent of the
solutions deployed by SMBs used IP (see Figure 4).

The availability of IP connections for voice services (VoIP) will speed up the adoption of IP telephony,
allowing SMBs to reduce their communications costs and access the advanced services that will
increase employee productivity and improve customer service.

Transforming Networks with SIP Trunking | Strategic White Paper 1

 Technology and business drivers
As shown in Figure 1, there are two categories of drivers for SMB transformation:
• Technology drivers, with IP as the underlying element.
• Budget/business drivers, with SMB demand for ICT solutions delivered as a service for a monthly,
per-user fee.

SMBs first started using IP through the Internet (Figure 1, arrow 1). In fewer than 10 years, the Internet
has been adopted by a large percentage of SMBs and is recognized as a cost-saving tool that helps them
strengthen customer relationships, increase mobility and collaboration and improve operational per-
formance. Consider these statistics, from BNP Paribas Lease Group, for SMBs in Western Europe:
• 96 percent are connected to the Internet
• 84 percent have a broadband connection
• 97 percent use e-mail
• 90 percent use the Internet to share information with partners and customers
• 40 to 80 percent (depending on the country) use the Internet to collaborate
• 70 percent have a web site that the most advanced of them consider a business tool.

This heavy use of the Internet, along with the development of residential VoIP solutions, have her-
alded the SMB migration toward a converged IP pipe that will support the Internet, VoIP and new,
converged services (Figure 1, arrow 2). At the same time, service providers are migrating their net-
works toward NGN/IMS. This will (Figure 1, arrow 3):
• Accelerate SMB adoption of IP telephony.
• Open the door to innovative, fixed-mobile convergence (FMC) solutions that are of high value
for SMBs. (According to information from Datamonitor, Current Analysis and Alcatel-Lucent,
an average of 25 percent of SMB employees have mobility requirements.)
• Accelerate the adoption of ICT, where Internet tools and voice are linked with IT applications
and new, multimedia features to provide SMBs with a global communications solution. This will
significantly change the profile of offerings made to SMBs, comparable to the way triple play offer-
ings changed the residential market.

Figure 1. Technology and business factors are driving SMB transformation

SMB solutions SMB budget

Technology, features Business model

VoIP IP telephony
adoption

Operators’ network
2 VoIP migration, 3 FMC
PSTN replacement
Wi-Fi
NGN, MCS OPEX
IP 2
IMS, ICT outsourcing

1
Internet ICT

xx€ per month,

per user
@ Wi-Fi

2 Transforming Networks with SIP Trunking | Strategic White Paper

In short, the three drivers behind SMB transformation can be summarized with these acronyms:
• NGN/IMS – This is the public network transformation. With IP at its core, this transformation
merges fixed and mobile technologies, enabling service providers to deliver new services.
• ICT – These solutions essentially define what convergence means for SMBs. They integrate
Internet tools, Web 2.0, voice, links to IT applications and multimedia to deliver advanced
communications and collaboration capabilities.
• MCS (Managed Communication Services) – With MCS, SMBs outsource ICT solutions as a service
for a monthly fee.

The remainder of this document describes how NGN/IMS network transformation is changing the
way private IP-PBXs connect to the public network and enabling a transition from PSTN connection
substitutions with IP to end-to-end solutions that will help SMBs benefit from new and innovative
communications services.

NGN/IMS and the SMB evolution to a single IP connection

While network transformation towards NGN/IMS has started, implementation has been slow so far
and availability of converged connections is still limited.

Today, most SMBs still maintain separate physical connections for voice and for IP/Internet usage
and a communications environment (Figure 2). Their communications environment is typically
composed of:
• A voice system (key system, PBX, IP-PBX) connected to the PSTN.
• A CPE Internet solution that ranges from basic access that is similar to residential access
to full-featured solutions with security and applications, and some Internet-related hosted
services, such as e-mail, web sites and electronic commerce.
• IT infrastructure, computers, servers, applications.

However, service providers, as part of their NGN/IMS network evolution, will provide SMBs with a
single IP pipe that supports the Internet, VoIP and new, converged services and connects the SMB
to the rest of world (Figure 3).

Figure 2. SMBs typically have separate voice and Internet connections today

SMB Operators, service providers

Computer telephony PSTN/ISDN

integration (CTI) PBX/
IP-PBX

Local
network
IP/Internet

Internet Hosted applications

Access VoIP
solution • Messaging
• Internet sites
Computer applications • e-commerce

Transforming Networks with SIP Trunking | Strategic White Paper 3

 Figure 3. SMBs are evolving toward a single voice and Internet connection

SMB Operators, service providers

End-to-end Hosted applications

solution • Messaging
• Applications • Websites
• Administration • e-commerce
• Presence
Communication solution • Conferencing
• IPT, multimedia • Call center
• Internet, applications • Fixed/mobile convergence
• Security • Administration
• Intelligent point
of service
Computer
applications IP/Internet
NGN/IMS
Single
IP access
Local
network

With IP, services that can be accessed from anywhere, at any time and on any device can be deployed
as soon as there is a connection to the network. This evolution will change the balance between
services that are delivered by CPE and services delivered by network applications. It will lead to more
integration between CPE and network solutions in terms of features and applications, as well as
administration and management.

The availability of the IP converged connections that will accelerate SMB adoption of IP telephony
is expected to dramatically evolve over the next two years (Figure 4).

Figure 4. IP telephony penetration in the SMB market is expected to steadily increase

SMB market worldwide. IP telephony penetration.

IP installed base (%) IP shipment (%)

100%

90%

80%

70%
60%
60%

50%

40%
30%
38%
30%

20%

18%
10%

0
2006 2007 2008 2009 2010 2011 2012 2013

Source: Alcatel-Lucent, Telecom Intelligence Group, IDATE, Dell’ORO. 2007-2008.

4 Transforming Networks with SIP Trunking | Strategic White Paper

 In 2007, IP telephony deployments worldwide represented less than 15 percent of the overall installed
base of SMB voice extensions. Time Division Multiplexing (TDM) extensions still counted for close
to 80 percent of shipped equipment in 2007.

However, the availability of converged connections for SMBs is expected to grow significantly during
the next two years. This will increase the yearly shipments of IP extensions to more than 60 percent
by 2010. Conversion of the installed base to IP is expected to be close to 100 percent by 2013.

The options and benefits of IP/VoIP for SMBs

Larger enterprises are transitioning to VoIP to take advantage of the cost savings and productivity
benefits. But SMBs have been slower to make the transition. Although there have been sound argu-
ments for larger enterprises to switch to VoIP — a single infrastructure for IT and voice, reduced
maintenance costs and lower move, add and change costs — the immediate benefits to motivate
SMBs to make the change have not been as obvious.

Until recently, costs of all-IP solutions remained higher than those of hybrid solutions supporting
TDM and IP. The benefits of a single infrastructure are not as important to SMBs as they are to
larger enterprises. And finally, there were very few or no new services that would have significantly
driven SMBs to IP solutions. Until now, SMBs have primarily been using IP technologies in PBXs
to reduce communications costs between locations and for deploying solutions that integrate
remote workers.

The advent of VoIP in the residential market has changed the way SMBs view VoIP. Offerings such
as Skype™, VoIP bundled with Internet Service Provider (ISP) broadband access offerings in the
context of triple play and the myriad of small Application Service Providers (ASPs) that offer free
calls over the Internet, have all promoted the idea that VoIP has become a mature commodity that
dramatically reduces business communications costs.

As a result, residential solutions are also used for business purposes. Skype has targeted specific offer-
ings to enterprise users but, while these offerings can reduce communications costs, they lack the
professional telephony features that businesses require and usually get from PBXs.

However, now service providers have started offering IP connections that bring PBX voice traffic
to an IP network or the Internet.

Gateway solutions versus SIP trunking

For speed and simplicity, most service providers have offered solutions with gateways that connect to
PBX trunks on one side and to their IP network on the other side (Figure 5). The gateways are PBX-
independent and convert between PSTN protocols (analog and Integrated Service Digital Network
(ISDN)) and IP protocols, typically SIP.

Figure 5. Connecting PBXs through gateways

Corporate Operator
private network
services IAD services
PBX TDM IP (SIP)
gateway
connection connection
IP, Internet, NGN

IP-phones

Transforming Networks with SIP Trunking | Strategic White Paper 5

 But the conversion these gateways perform is often minimal, limiting the services that can be deliv-
ered over these connections. So, while they do enable SMBs to benefit from the low tariffs of VoIP
calls, the SMB often has to sacrifice features, such as direct dial in (DDI) and calling-line identity
(CLI), offered by direct PSTN connections. And gateway solutions are not suitable for exploiting
all the capabilities of SIP or for accessing the new services that will be enabled by NGN/IMS
deployments. They are intrinsically limited because IP and SIP services cannot be fully mapped
onto PSTN protocols.

Also, with a gateway solution, end users do not benefit from the overall set of features that are in the
PBX and in the network. They have different sets of features depending whether they are using, for
example, a business phone connected to the PBX, an IP phone or mobile phone managed by the ser-
vice provider’s network. As a result, gateways are a short term solution for connecting SMBs to a VoIP
network and will gradually disappear with the availability of native IP/SIP connections on IP-PBXs.

The advantage for the service provider is that they can rapidly deploy a solution that works with
any PBX and allows SMBs to benefit from VoIP tariffs without touching their PBXs. It can drive
service providers toward promoting hosted solutions, such as IP Centrex, that would replace the
PBX, leveraging the installed Integrated Access Device (IAD) and gateways. But, considering the
very low market share that IP Centrex has attracted in the SMB space over the past years, such
a strategy would likely have limited success.

With SIP trunking, the IP-PBX is connected directly to a service provider VoIP network, eliminating
the need for a gateway. It provides a native IP/SIP connection that can exploit all the capabilities of
the SIP protocol (Figure 6).

Using SIP trunking to connect IP-PBXs directly to NGN/IMS networks creates a consistent envi-
ronment between the enterprise IP-PBX and the network. It replaces the TDM trunk with a SIP
connection that delivers voice services and will smoothly evolve to a multiservice connection that
supports new, IP-based services such as presence, intelligent call routing and fixed-mobile conver-
gence in the network and in the enterprise.

For SMBs, the immediate benefit of moving to a SIP trunking solution is a reduction in commu-
nications expenses. Connection fees are lower than those of ISDN and communications are billed
according to VoIP tariffs. Looking ahead, SIP trunking solutions pave the way for further evolutions
to SIP peering and IP peering.

Figure 6. Connecting PBXs with native IP/SIP

Corporate Operator
private network
services services
IP-PBX IP (SIP) IP (SIP)
connection connection
IP, Internet, NGN
Access
router

6 Transforming Networks with SIP Trunking | Strategic White Paper

A closer look at SIP trunks
A SIP trunk is a substitute for an ISDN T0/T2 connection. Physically, it is an IP connection over a
symmetric digital subscriber link (SDSL), over cable or over fiber, depending on the service provider.
The size of the enterprise and the required number of voice channels influence the choice of the
physical IP connection. A regular asymmetric digital subscriber link (ADSL) can support up to two
voice channels. An SDSL can replace a primary rate interface (PRI) connection.

Directly connecting an IP-PBX to a service provider IP network establishes a direct relationship

between the SMB’s IP domain and the service provider’s IP domain. To avoid potential issues, such
as security violations and problems with IP addressing schemes, a clear demarcation point between
the enterprise and the service provider IP domains must be established. This is the role of the Ses-
sion Border Controller (SBC), installed at the boundary of the service provider’s network. The SBC
manages a trusted connection between SMB IP network and the service provider’s IP network. It
also controls interactions between both networks and performs all the necessary adaptations — IP
address translation, for example.

The SIP protocol is, by definition, open and flexible. This is good for both future evolution and de-
livery of innovative new services. As far as SIP trunking is concerned, the openness and flexibility of
SIP has led to the proliferation of different implementations in both service provider networks and in
IP-PBXs. And the standard does not yet include commonly agreed definitions that recommend which
options to select and implement. This has slowed the deployment of SIP trunking as specific interop-
erability tests have to be performed between every IP-PBX and every service provider.

Service providers, IP-PBX suppliers and standards bodies are working closely together to bring SIP
trunking to maturity and enable general availability of SIP connections with the same level of in-
teroperability the PSTN delivers today. It will likely take another one or two years before SIP trunk-
ing reaches that level of maturity. Assumptions from market analysis (see Figure 4) indicate that by
2010, SIP trunking will be generally available as a substitute for PSTN connections. This would be
the starting point of a massive adoption of IP telephony by SMBs.

From SIP trunking to SIP peering and IP peering

SMB IP connections to the network will evolve from SIP trunking toward multiservice connectivity
that can be called SIP peering, or more generally, IP peering. Peering involves balanced cooperation
between the SMB and the network. The SMB behaves as a private network that connects to the
service provider’s public network in a peer-to-peer mode. This allows for real cooperation between
applications that are in the enterprise and applications that are in the network.

IP peering uses the SIP protocol, along with other (IP) protocols, to support some of these interac-
tions, depending on the type of applications that are involved (unified messaging or management,
for example). It supports end-to-end solutions between the enterprise and the network, providing
users with seamlessly-integrated, CPE-based enterprise services and NGN/IMS network services.

IP peering is a balanced cooperation between an enterprise CPE solution, considered to be a private

network, and a service provider NGN/IMS network, the public network. A single IP connection sup-
ports all interactions between the two networks and an SBC manages a trusted connection between
the enterprise and the service provider network.

Transforming Networks with SIP Trunking | Strategic White Paper 7

 Different types of interactions take place between the enterprise CPE solution and the service
provider NGN/IMS network, depending on the applications and the services offered to the enter­
prise users. These interactions are the building blocks for the development and deployment of
end-to-end solutions.

As previously described, the first level of interaction between the enterprise CPE solution and the
NGN/IMS network is SIP trunking. The IP-PBX works with the session control function in the
network (the Call Session Control Function (CSCF) in IMS, for example) to handle voice calls
with associated network services such as DDI, CLI, routing and rerouting (Figure 7). The protocol
supporting this interaction is SIP.

Figure 7. SIP trunking for voice network services

SMB – Enterprise CPE solution Service provider – NGN/IMS

Other
applications
Other
applications
Enterprise voice
applications
IP-PBX and
1 Router IP connection SBC
applications
1
Session
control
Management

Management

SBC = Session border controller

1 Voice network services, SIP trunking

SIP trunking mainly handles voice calls. It does not leverage voice applications in the enterprise
and in the network to deliver advanced voice features to end users. To deliver more features in the
context of an end-to-end solution, it is necessary to establish complementary interaction between
the IP-PBX and its associated voice applications and the network enterprise voice applications, such
as hosted telephony and FMC. This interworking between applications is SIP-based and the interac-
tions are used to deliver a global FMC service for both on-premises and on-network requirements
(Figure 8).

8 Transforming Networks with SIP Trunking | Strategic White Paper

Figure 8. SIP peering for voice feature transparency

SMB – Enterprise CPE solution Service provider – NGN/IMS

Other
applications
Other
applications
Enterprise voice
applications
2
IP-PBX and
2 Router IP connection SBC
applications
Session
control
Management

Management

SBC = Session border controller

2 Voice features. SIP, service transparency

Communications and collaboration features used by enterprises go largely beyond voice. IP peering
between enterprise CPE solutions and service provider NGN/IMS networks should include interac-
tions between non-voice applications in the enterprise and in the service provider network (service
provider or Internet). This includes, for example, messaging features, multimedia services and Web
2.0 collaboration capabilities. These interactions require different protocols for different targeted
applications. SIP is used, along with web services. User Agent Computer Supported Telecommuni-
cations Applications (uaCSTA) can be employed to leverage existing applications that interact with
IP-PBXs. And, application-specific protocols can also be used when necessary (Figure 9).

Figure 9. Applications peering

SMB – Enterprise CPE solution Service provider – NGN/IMS

Other
applications
Other
applications
3
Enterprise voice
applications
3
IP-PBX and
applications Router IP connection SBC
Session
control
Management

Management

SBC = Session border controller

3 SIP, uaCSTA, Web services/XML, applications-applications protocols

Transforming Networks with SIP Trunking | Strategic White Paper 9

 IP peering does not only deal with features. It includes a management component that federates
information about users, features and applications between enterprise CPE solutions and the service
provider NGN/IMS network. This is necessary for provisioning end-to-end services. It is also neces-
sary for enterprise and end user management of personal information and service configurations,
such as call forwarding and call routing. This management interaction also includes exchanges of
information, such as alarms, that are necessary for monitoring the end-to-end solution.

Different protocols are used. Simple Network Management Protocol (SNMP) is the solution of
choice for reporting events and alarms that are used for service supervision. Web services based on
XML are used for accessing, or performing specific actions on the data associated with the services.
Other protocols can be also be used depending on specific environments (Figure 10).

Figure 10. Management peering

SMB – Enterprise CPE solution Service provider – NGN/IMS

Other
applications
Other
applications
Enterprise voice
applications
IP-PBX and
applications Router IP connection SBC
Session
4
4 control
Management

Management

SBC = Session border controller

4 SNMP, Web services/XML, specific protocols

Service provider network transformation toward NGN/IMS has started. SIP trunking is the first step
for integrating IP-PBXs in that move. The advent of NGN/IMS networks will reshape the border be-
tween CPE solutions and network-based solutions. End-to-end solutions, with interworking between
CPE and network solutions, are likely to answer to enterprises needs, providing choice and flexibility,
and ensuring a smooth migration that takes existing investments into account. SIP trunking allows
SMBs to benefit from VoIP tariffs for their voice calls. It is also the basis for further integration of
their equipment and applications with NGN/IMS services

Alcatel-Lucent Office Communication Solutions and SIP trunking

Alcatel-Lucent delivered its first implementation of SIP trunking for SMBs with Alcatel-Lucent
OmniPCX Office Communication Solutions R5 in 2006. Since that time, tests to ensure interoper-
ability between IP-PBXs and NGN/IMS networks have been performed with service providers and
standards bodies all over the world. As a result, Alcatel-Lucent OmniPCX Office Communication
Solutions R6 and R7 featured SIP trunking evolutions that were based on the feedback and experi-
ence from working with numerous service providers.

Alcatel-Lucent has developed a technical questionnaire that allows for rapid assessment of whether
a service provider’s SIP implementation will interoperate with Alcatel-Lucent Office Communica-
tion Solutions.

10 Transforming Networks with SIP Trunking | Strategic White Paper

Figure 11. Alcatel-Lucent Office Communication Solutions SIP trunking test status as of November 2007

Conclusion: The time for SIP trunking has arrived

While many large enterprises have already taken advantage of VoIP to reduce communications costs,
the evolution is now starting to make sense for SMBs as well. A key driver behind this change is the
NGN/IMS network transformation currently underway by service providers around the world. With
NGN/IMS, SMBs can benefit from a single IP connection that delivers cost-effective VoIP, the
Internet and innovative new multimedia services.

In fact, analyst reports state that, by 2013, service providers will offer only IP connections to SMBs,
making them the norm, rather than the exception (see Figure 4). SIP is the preferred protocol for VoIP
services. By replacing PSTN trunks with SIP trunks connected directly to the service provider’s
network, SMBs can benefit from low-tariff VoIP calls and innovative new services.

SIP trunking is also a first step toward SIP/IP peering between the SMB environment and the service
provider network. With SIP/IP peering, SMBs will benefit from end-to-end solutions that offer seam-
less integration between applications and services in the enterprise and applications and services in
the NGN/IMS network.

Anticipating the SMB transformation to a single IP connection and the resulting need for SIP trunk-
ing, Alcatel-Lucent offers a robust SIP trunking solution that has undergone extensive interoperability
testing and is fully aligned with service providers’ NGN/IMS deployments.

Transforming Networks with SIP Trunking | Strategic White Paper 11

Appendix A
More about SIP
SIP is an application-layer control (signaling) protocol, defined by the Internet Engineering Task
Force (IETF). It is used to create, modify and terminate sessions, such as Internet telephone calls,
multimedia distribution, multimedia conferences and presence based services with one or more
participants. SIP has been accepted as a 3rd Generation Partnership Project (3GPP) signaling
protocol and permanent element of the IMS architecture.

SIP usage for VoIP has grown dramatically in recent years and is now the dominant protocol for
residential VoIP services (with the exception of Skype, which uses a proprietary solution).

H.323 has been the preferred protocol for connecting IP-PBXs to NGN since VoIP services were
offered to enterprises. But because SIP has been endorsed within the IMS architecture and is at the
core of NGN evolution, it will be the dominant protocol in the future. Following SIP deployments
in the residential market, SIP connectivity offerings for enterprises grew in the past year.

SIP is a lightweight protocol designed for simplicity and openness. It has only six methods —
commands indicating the action to be performed on the identified resource — and is transport-
independent so it can use a variety of transport mechanisms, including Transmission Control
Protocol (TCP), User Datagram Protocol (UDP) and Asynchronous Transfer Mode (ATM).

Table 1. SIP methods and descriptions

SIP methods Description

INVITE Invites a user to a call

ACK Facilitates reliable message exchanges for INVITEs
BYE Terminates a connection between users or declines a call
CANCEL Terminates a request, or search, for a user
OPTIONS Solicits information about a server’s capabilities
REGISTER Registers a user’s current location
INFO Used for mid-session signalling

Table 2. SIP responses and content

SIP responses Content and examples

1xx Informational (100 Trying, 180 Ringing)

2xx Successful (200 OK, 202 Accepted)
3xx Redirection (302 Moved Temporarily)
4xx Request Failure (404 Not Found, 482 Loop Detected)
5xx Server Failure (501 Not Implemented)
6xx Global Failure (603 Decline)

SIP can be used in any application where session initiation is required. Once the session is established,
it can be used to exchange information between the endpoints involved in the session. The content
of what is exchanged and the behavior of the applications have to be defined for each specific usage.
SIP does not define features. As a result, there are a large number of SIP-related Requests for Comment
(RFCs) that define behavior for different applications.

12 Transforming Networks with SIP Trunking | Strategic White Paper

SIP is used for initiating sessions and is only involved in the signaling portion of a communication.
It acts as a carrier for the Session Description Protocol (SDP), which describes the media content of
the session — the IP ports to use, the codec being used, etc. SIP is associated with several other pro-
tocols depending upon the application. For example, for VoIP, SIP is associated with the Real-Time
Transport Protocol (RTP) for carrying media.

The essence of SIP is a peer-to-peer approach. It is different from more traditional client-server archi-
tectures that implement a centralized, controlled approach. Network-provided services, such as hosted
VoIP and IP-PBX services are usually based on client-server architectures. SIP standard extensions
have been developed by organizations such as 3GPP and 3GPP2 in order to take this into account.

SIP has been defined as a simple, flexible and open protocol that is appropriate for many types of
applications that require sessions to be established between endpoints (terminals and applications,
for example). But its high flexibility has also led to difficulties because those implementing SIP can
select from several different options when developing features. Until now, this has made interopera-
bility more complicated. To address this issue, ongoing work to refine SIP standards will recommend
preferred options according to the type of usage.

SIP trunking standardization activities are performed by the International Telecommunication Union
(ITU) and European Telecommunications Standards Institute (ETSI) -Telecommunications and
Internet Converged Services and Protocols for Advanced Networks (TISPAN) organizations as
well by the SIP Forum and the SIPconnect group.

All these efforts will lead to a stabilization of SIP usage in the different contexts in which it is involved
(devices, service providers’ network connection, SIP trunking, etc.). This is a necessary condition
for general availability of IP/SIP connections that will allow SMBs to enter the NGN/IMS arena
and fully benefit from IP telephony.

SIP registration
SIP registration is mandatory for accessing services delivered from the network by service providers.
It allows service providers to locate the user and the device on which he/she can be contacted and
grant access to services according to subscription. It does this by associating a SIP Contact Address
with the user’s SIP address of record.

The SIP Address of Record is the address people use to contact a user (joe@mycompany.com, for
example). It is the unique identifier associated with a person.

The SIP Contact Address is a SIP Unified Resource Identifier (URI) (sip:x@y:port, for example:
sip:77760@212.123.1.213:5060) that defines the location and the device at which the user can cur-
rently be reached. A user can have several SIP Contact Addresses, each of which can be modified
according to user needs (mobility, for example).

A parallel can be made with the one number and nomadic mode services provided by PBXs. The
SIP Address of Record is similar to the one number associated with a user because it is unique and
it typically does not change. The SIP Contact Address is similar to the telephone number of the
physical device used in nomadic mode because it changes according to user situation and preferences.

Individual registration
Individual registration is the default procedure in SIP. In this case, a SIP registration is performed
for every user. Each user has his/her own identification with associated authentication, preferences,
profile, access to services, etc. declared in the service provider network.

Transforming Networks with SIP Trunking | Strategic White Paper 13

 Individual registration is used for SIP services delivered to residential users. Registration can be per-
formed by the user through the administration part of the User Agent (the user’s device or client).
Or it can be automatically performed by an Integrated Access Device (IAD) such as the service
provider’s triple play box.

This procedure makes sense when all applications are hosted on the network as is the case for cellular
and IP Centrex today. But it is a radical change in the way enterprises, when equipped with a PBX,
manage fixed telephone lines allocated to the employees. Authentication, profiles, preferences and
access to services are handled by the PBX. A global enterprise profile defines authentication, prefer-
ences and access to services, as subscribed by the enterprise. User access control to services, such as
authentication profiles and preferences, is performed by the PBX.

Enterprise (IP-PBX) registration

SIP trunking is about PSTN trunk substitution.

Most service providers offer an enterprise registration (IP-PBX) for SIP trunking. A SIP trunk is physi-
cally associated with a PBX (as is a PSTN trunk). In that context, the SIP Address of Record is the
installation number allocated by the service provider to the enterprise location. The SIP Contact
Address is the SIP URI of the IP-PBX serving the enterprise location. The service provider associates
the DDI numbers of the employees (seen then as individual users for network call routing services)
with the SIP Address of Record in its internal database.

In practice, IP-PBX SIP registration associates the SIP URI (sip:OmniPCXOffice@ 212.123.1.213:5060,
for example) to the installation number (+33 3 9067 7700, for example). DDI numbers (+33 3 9067 7701
to 7799, for example) are managed internally by the service provider and are associated with the
installation number.

Evolution with SIP/IP peering

In the context of end-to-end solutions, there is extended cooperation between the CPE and the net-
work applications for both features and management. User management will evolve in that context.
Neither the individual registration as it exists today, nor the IP-PBX registration are sufficient for
building end-to-end SIP/IP peering solutions from the enterprise to the network.

Abbreviations
3GPP 3rd Generation Partnership Project
ADSL asymmetric digital subscriber line
ASP Application Service Provider
ATM Asynchronous Transfer Mode
CLI calling-line identity
CPE customer premises equipment
DDI direct dial in
DSL digital subscriber line
ETSI European Telecommunications Standards Institute
FMC fixed-mobile convergence
IAD Integrated Access Device
ICT information and communications technology
IETF Internet Engineering Task Force
IMS IP Multimedia Subsystem
IP Internet Protocol
ISDN Integrated Services Digital Network
ISP Internet service provider
IT Information technology
ITU International Telecommunication Union
MCS Managed Communication Services
NGN next-generation network
PBX Private Branch Exchange
PRI Primary Rate Interface
RFC Request for Comment
SDP Session Description Protocol
SDSL symmetric digital subscriber line
SMB small and medium business
SNMP Simple Network Management Protocol
TCP Transmission Control Protocol
TDM Time Division Multiplexing
TISPAN Telecommunications and Internet Converged Services
and Protocols for Advanced Networks
uaCSTA User Agent Computer Supported Telecommunications
Application
UDP User Datagram Protocol
URI Unified Resource Identifier
VoIP Voice over Internet Protocol

14 Transforming Networks with SIP Trunking | Strategic White Paper

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