Manulife Financial on Friday joined the ranks of large enterprises who are hoping to lower their costs by moving to voice over IP through a seven year, $140-million deal with Bell Canada’s
BCE Connexim, formerly a joint venture with Hydro-Quebec but now a wholly-owned Bell services subsidiary, will deploy Cisco IP phones and related network equipment to Manulife’s operations both in Canada and the United States, where it operates under the name John Hancock. Four branch offices have been set up so far, and the head office in Toronto has been piloting voice-over-IP (VoIP) for the better part of a year.
John Mather, Manulife Financial’s CIO, said the decision to move from its traditional private branch exchange (PBX) network was driven primarily by the firm’s belief that tariff costs will be dramatically reduced in the next three to five years. This deal will involve non-tariff services, but the idea is that inter-office long distance and local access expenditures will fall as a variety of IP phone carriers enter the market. This year, for example, has seen the debut of Primus Canada, Vonage Canada and several others.
Manulife spent 18 months watching the VoIP market before moving ahead with its strategy, Mather said, concluding that the technology was finally ready for prime time.
“”What we find is rely very heavily on our computer-based IP network, where reliability is as important as the voice network,”” he said. “”We’ve been able to, if you will, harden our comptuer-based IP network to the point where we think it’s equal to or even surpasses what our voice network can provide.””
For example, Mather said, Manulife has only one PBX in many of its branch offices. “”If you lose that one PBX for some reason — which is essentially an old style of computer — the whole phone system goes down. As opposed to our computer network, where we always have a redundant server, and if the server goes down, your e-mail will continue to work.””
Isabelle Courville, group president of enterprise markets at Bell Canada, said the company’s internal move to VoIP has set an example for its customers.
“”It’s a migration strategy — this deal is the perfect example,”” she said. “”We take the network as is, and we will migrate both the network and the data to the IP platform.””
Manulife has a number of inbound call centres for producers, broker/dealers and customers. IP will make it much easier to integrate its custom applications to the phone system, Mather said. It should also make it easier to redirect calls during an outage, which is an important part of meeting the firm’s disaster recovery and business continuity plans, he said.
“”A lot of people move to IP to save a bit of money. But after that, you are in a brand new world,”” Courville added. “”You can deploy IP-enabled applications, and solutions. Security could be better.””
About 30 Manulife employees moved over to Bell through the deal, which Mather said would be critical as the two firms develop a migration strategy for the IP system.
“”It’s unlikely that anyone can take everybody — for example, in our head office, it’s about 3,500 people — and switch them in one weekend,”” he said. “”That requires a program and several link methods to allow the IP users to continue to operate within the company network – so voice mails could be forwarded, directory views are the same.””
Courville said Manulife’s plans are a healthy sign for the acceptance of IP telephony in the enterprise.
“”I think that started in 04, but 05 will be a lot of piloting and trialling,”” she said. “”I think it will take a few more years, though, for massive migrations.””
BCE Connexim recently signed a similar services agreement with CGI, and has since expanded its operations with an Ontario office, Courville added. Other clients include Desjardins Group.