Overview

Some departments have installed Voice over Internet Protocol (VoIP) systems that provide some telephone services to the faculty and staff in their departments. These VoIP systems enable calling between the VoIP telephone instruments within the department without using the campus telephone system, but do use the campus telephone system to place and receive calls with other campus departments and with off-campus telephones. When these systems were being implemented, we did not have a rate in place that would recharge these departments for their "fair share" of the use of the campus telephone system. We did not want to hinder the development of this technology on campus, so we applied an artificial "virtual telephone number" rate to the telephone numbers used by these VoIP systems, identical to the rate we use for temporarily disconnected telephone lines ($1.68/number/month). Prior to implementation, we told the departments that this rate would be subject to future adjustment. This document explains why the Communications Services staff believes that the recharge rate for the telephone numbers used by VoIP systems should be "normalized" in relation to other telephone numbers and telephone lines provided by the campus telephone system.

Background

Before these VoIP systems were installed, we had two types of telephone instrument connections: single-line analog telephones and Panasonic multi-line digital telephone systems. Please refer to the diagram, Connections between the campus telephone switch and departmental telephone systems and phones (pdf), for clarification of the following discussion.

Every analog telephone has a unique campus telephone number (e.g., 893-1000). Every analog telephone requires a physical connection in the campus telephone system (called a "port") and one pair of copper wires between the port and the telephone instrument. There are sixteen analog ports on an analog station card in the telephone system. The Panasonic systems consist of a control unit and multiple telephone instruments. Any campus telephone number can appear on multiple Panasonic telephone instruments, but each telephone number requires a telephone system analog port and one pair of copper wires between the Panasonic control unit (within the customer's building) and the campus telephone system (in the Public Safety building). The Panasonic control unit provides some calling features to the Panasonic telephone instruments without interaction with the campus telephone system (e.g, an intercom call or a page to all telephones). However, all calls between Panasonic telephone instruments, other campus telephone instruments, and all off-campus telephone instruments depend on the switching functions of the campus telephone system. Therefore, departments using the Panasonic system have always been charged for a Business Telephone Line for each campus telephone number used on the Panasonic systems, and every Business Telephone Line is also charged a Data/Networking Surcharge.

VoIP systems connect to the campus telephone system using copper cables, just like analog telephone instruments, but they connect into the telephone system using a different type of interface. Analog instruments and Panasonic control units both connect to the telephone system via analog ports. VoIP systems connect to the telephone system using digital ports. These digital ports are called a Primary Rate Interface (PRI) trunk, and can multiplex up to 23 concurrent voice calls plus one control signal (for a total of 24 ports) over a single pair of copper wires. A VoIP system may support one hundred (or more) campus telephone numbers by sharing the 24 digital PRI ports. If a VoIP instrument calls another VoIP instrument on the same VoIP system, the call stays within the VoIP system and does not traverse the campus telephone system. However, if a VoIP instrument calls (or is called by) a campus analog instrument, a campus Panasonic instrument, or an off-campus instrument, the call does use the campus telephone system.

To support the development and testing of the VoIP systems using these PRI ports, we told the implementing departments that we did not have a recharge rate that took into account the multiplexing provided by the digital PRI ports, and we would use an artificial rate until a true rate could be developed. We offered to charge them for a minimum of twelve (12) analog ports (to support up to 12 concurrent calls between the VoIP system and the rest of the world), each of which would be recharged at the rate for a Business Telephone Line (plus a Data/Networking Surcharge), plus a nominal charge for each campus telephone number (893-xxxx number) configured on the VoIP system. This nominal charge was the same that we charge for a Temporarily Disconnected business line ($1.68/line/month). This recharge structure was not significant when there was a small number of VoIP systems using a small number of campus telephone numbers. However, some departments realized that they could use a VoIP system to bypass having to pay for the Data/Networking Surcharge applied to each campus telephone number. If their department was large enough, they could acquire a VoIP system and pay for it by avoiding the cost of Business Telephone Lines and Data/Networking Surcharges.

An example may help to understand this situation. Assume one department has fifty analog telephone instruments. At our current recharge rates, they are charged for fifty Business Telephone Lines ($17.50/month each) plus fifty Data/Networking Surcharges ($6.50/month each) or $1,200 per month. Another department using a VoIP system with fifty campus telephone numbers is charged for twelve Business Telephone Lines ($17.50/month each) for the digital PRI port connection to the campus telephone switch, each with a Data/Networking Surcharge ($6.50/month each), plus fifty Temporary Disconnected business lines ($1.68/month each) or 12 * ($17.50 + $6.50) + 50 * $1.68 = $372.00 per month. This is an effective rate of $372.00 / 50 = $7.44/month for each telephone number. Therefore, a large department using a VoIP system can obtain the same telephone connection services at a greatly reduced rate per telephone number, causing small departments that can't afford to acquire a VoIP system to subsidize the large departments.

50 Analog Telephones

50 VoIP Telephones

Proposal

Communications Services proposes to correct this inequality in charges for using the campus telephone system by breaking down the end-to-end connection between the campus telephone system and the department's telephone instruments (whether they are analog, Panasonic or VoIP instruments) into discrete components and forming a rate from the individual component charges.

In the diagram Connections between the campus telephone switch and departmental telephone systems and phones (pdf), the three types of departmental telephone instrument connections and their components are presented.

1. The left-hand column shows a connection for an analog telephone instrument. Each instrument uses one of sixteen analog ports on an analog station card (the interface to the campus telephone system) and one pair of copper wires.
2. The middle column shows a connection for a Panasonic control unit and Panasonic digital telephone instruments. The Panasonic control unit uses one of sixteen analog ports on an analog station card for each campus telephone number and one pair of copper wires for each telephone number, regardless of how many digital instruments use those telephone numbers.
3. The right-hand column shows a connection for a departmental VoIP system. Each VoIP system uses a PRI trunk card that supports up to 23 concurrent calls, plus one control port, for a total of 24 digital PRI ports. There are two devices (called an Adtran PRI Repeater), one located next to the campus telephone system and one next to the VoIP system, used to carry the digital signals over a single pair of copper wires between the two buildings (the Public Safety building and the building with the VoIP system).

We are proposing to recharge all telephone connections (analog, Panasonic or VoIP) for the following.

1. A Telephone Port charge: Pays for the analog or digital ports of the campus telephone system used by the department's telephone instrument or telephone control unit, and the copper wires between the telephone system and the department. This port is the only difference between connecting an analog telephone, a Panasonic telephone or a VoIP telephone to the telephone system.
2. A Telephone Number charge: Pays for the campus telephone number services (i.e., switching of calls between the departments' telephone instruments and other instruments, whether on-campus or off-campus, 911 calls, campus operator, etc.). The telephone number services are identical, regardless of the type of Telephone Port used. That is, the services provided to a VoIP telephone are the same as those provided to an analog telephone or a Panasonic telephone.
3. A Data/Networking Surcharge per Telephone Number: Pays for some of the networking services provided by Communications Services.

The vendor that maintains the telephone system charges Communications Services a monthly maintenance fee for each Telephone Port. The fee is $0.75/port/month, regardless of the type of Telephone Port (analog port or digital PRI port). The Telephone Port charge would be the sum of the vendor's maintenance charges and the current recharge rate for the rental of copper wires ($2.25/cable pair). The proposed recharge rates are as follows.

1. An analog Telephone Port charge would be $3.00 (1 vendor maintenance charge at $0.75 + 1 cable pair at $2.25).
2. A digital PRI Telephone Port charge would be $20.25 (24 vendor maintenance charges at $0.75/each + 1 cable pair at $2.25).

Assuming no other rate changes for a business telephone line, the Telephone Number charge would be $14.50 per month, which is the current Business Telephone Line rate of $17.50 less the analog Telephone Port charge of $3.00.

The Data/Networking Surcharge would remain at the current rate of $6.50 per month.

Using the earlier example, a department with fifty analog campus telephone instruments (or a Panasonic system with fifty campus telephone numbers) would be charged as follows.

50 Analog Telephones, Normalized

A department using a VoIP system with fifty campus telephone numbers would be charged as follows.

50 VoIP Telephones, Normalized

Using the proposed rates, the department with a VoIP system would benefit from the reduced rate for the digital PRI Telephone Port connection, but pay the same rate for the campus telephone system services (Telephone Number and Data/Networking Surcharge) as the department using analog telephones.

Fiscal Year 2011 Recharge Rate Proposal Effect on the Above

A separate recharge rate proposal for fiscal year 2011 has been submitted which would reduce the Telephone Number rate by $6.50/month. Since this proposal was not accepted at the time of writing this document, the Telephone Number rate is shown at the pre-proposal rate of $14.50/month. If the fiscal year 2011 recharge rate proposal is accepted, the Telephone Number rate will be adjusted accordingly.

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