High connectivity costs? Problem solved

Nevertheless, says Graeme Victor, CEO of voice-based telecommunications solutions company Du Pont Telecoms, the benefits of these advanced LCR and VOIP technologies often come at an unexpected price in terms of connectivity quality and actual savings achieved.

LCR takes advantage of the fact that land line-to-cellphone calls are expensive while cell-to-cell calls are a lot cheaper. By installing a LCR solution, calls to cellphones are automatically routed via a SIM in the LCR box over the least-expensive connectivity option.

“That's the theory and it works well in environments with high call volumes, because charges for LCR solutions are usually based on bundles of minutes negotiated with a cellular network operator. But if a branch doesn't utilise sufficient minutes to qualify for bundle rates, LCR might not be as cost-effective as expected or desired,” he explained.

VOIP solutions

In order to overcome this, growing numbers of retailers have turned to VOIP solutions. They direct their branches' voice traffic over their IP network to the head office-based LCR router in order to benefit from call economies of scale - higher call volumes translate into lower per-minute bundle charges.

However, the quality of VOIP calls is seldom comparable to that of land line telephony calls. Throw in the suspect quality of cellphone calls and the VOIP solution could result in degraded call quality. In addition, the volume of voice traffic over the retailer's IP network may lead to severe bandwidth congestion, negatively affecting data traffic as well.

“Investing in more bandwidth is expensive and could well wipe out any savings achieved from the LCR solution,” Victor added. The answer, he maintained, is the implementation of a virtual LCR SIM solution.

SIM Farm

In a conventional LCR set-up, the LCR device or router with the cellular network provider SIM is housed at the premises from where the calls are made. In the VOIP scenario, the SIMs are hosted centrally, and the calls are routed over the IP network to the centralised LCRs in what is often referred to as a “SIM farm”.

The virtual LCR SIM scenario is similar in that the SIMs are hosted centrally. However, that's where the similarity ends.

“Effectively what happens in the virtual solution is that data about the SIM is transmitted over the IP network, rather than the voice call itself. The actual voice call breaks out to the cellular network from the location where the call originated, rather than from the centralised site.

“Retailers therefore benefit from economy of scale savings on call volumes without suffering any degradation of call quality or the problems associated with congested IP network,” Victor concluded.