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Cisco ships Net-phone bundling device

The company begins shipment of a new device that allows telecommunications service providers to bundle phone services and Web access to businesses.

Cisco Systems on Monday began shipping a new device that allows telecommunications service providers to bundle phone services and Internet access to small and midsized businesses.

The new device paves the way for service providers to offer businesses not only high-speed Internet access, but also the option to switch from traditional phone service to cheaper Net-based phone calls, the company said.

Small and midsized businesses that have the equipment can have all their network data and voice traffic run through a single Net-based connection simply by plugging their existing phones, fax machines and computers into Cisco's new equipment, Cisco executives said.

Cisco competes against smaller network equipment makers, such as CopperCom, Jetstream Communications and TollBridge Technologies, which build similar devices for service providers to sell to their business customers. Clarent, which specializes in equipment that allows Net-based phone calls, also plans to enter the market in the coming months.

Cisco's new product is aimed at emerging service providers that want to compete against traditional phone companies, said Mark Monday, a Cisco product marketing director.

Most service providers--as well as businesses--use separate networks to handle data and voice. But for the past few years, equipment makers have touted the idea of "convergence," or the marrying of voice and data on a single Internet protocol (IP)-based network.

Network equipment makers say the single network will be cheaper and easier to maintain, but the concept has been slow to take off because of concerns that having phone service over a data network isn't as reliable.

In addition, as service providers move to a converged network, they don't want to force their business customers to have to rip out their existing networking equipment and replace it with a new product, according to analyst Tom Jenkins of consulting firm TeleChoice.

Cisco on Monday said three service providers, BroadRiver Communications, Cbeyond Communications and CTC Communications, are testing Cisco's new family of products--called the Smart Integrated Access Device 2400. The product supports 24 phone lines, enough for a business with about 120 employees, Monday said.