Simwood Virtual Interconnect – Inbound

Simon Woodhead

Simon Woodhead

23rd May 2013

We’ve had a fantastic year so far at Simwood, growing our customer base substantially. Whereas in past years this was from new entrants to the VoIP space, we’re now seeing established operators seeking to get higher in the supply chain. We’re also benefitting from “competitors” dropping the ball and the improving knowledge amongst our customers flushing out resellers claiming to be wholesale providers, and making judgements on other genuine wholesalers infrastructure. This is all good but our work is not done!

Much of this growth has come from a service that we realise we’ve never actively promoted and where our proposition really is quite unique. That service is our Virtual Interconnect – Inbound.

Simwood numbering is hosted on our own infrastructure and connection to and from the PSTN is via our own redundant SS7 switches and two-way TDM capacity into multiple BT exchanges and other operators. It is important to note that the PSTN is the interconnection of TDM switches amongst operators and not simply BT; the only way BT can reach Simwood numbers or any other operator is over their interconnect into them. BT is part of the PSTN, the PSTN is not part of BT!

Our ‘Virtual Interconnect – Inbound’ service is, as the name suggests, your own interconnect to BT (and others) over our infrastructure. Other operators may call this ‘number hosting’ but we think that is a little condescending: progressive customers don’t want to feel dependent on an operator, they want to be the operator. Our aim is to give them all the benefits of that in a palatable progressive form.

Our business is about enabling VoIP and we’re trying to offer as wide a path as possible so that you can grow with us, not through us. From renting a few DDIs from £40 per month right through to us building your very own TDM interconnects as a Professional Services project, our business is about enabling you to build a real-time communications business with a product set that can grow with you.

If you are presently using Simwood numbering you’ll be enjoying our leading API (and portal) and in many cases have integrated it into your provisioning processes and CRM. You’ll probably be paying us a rental per number and we’ll be giving you the capacity you need without capacity charges. At some stage, for a multitude of reasons you may wish to have your own numbering and this is where the Virtual Interconnect Inbound comes into play. In essence you obtain your own numbering from OFCOM and those new numbers become reachable over Simwood interconnects, you pay us for capacity used rather than per number and we pay you up to 100% of the income. [We say “up to” as by default we offer 100% but we offer a variety of different pricing models to make this accessible starting from us making no charge for capacity and paying no income!] The great news is that you can administer your numbers on the interconnect in exactly the same way through our API and make use of the standard features we offer such as fax-to-email. The only difference is that your numbers will all be pre-assigned to your account only. We even run them through our gold number algorithms so you’ll know which are the more special ones – of course, we’ll never charge you for using them as they’re your numbers!

Aside from the great API there’s some really compelling reasons why you should use Simwood for this:

  • 100% of the income. If we say we’ll pay you 100%, we’ll pay you 100%. We have won customers recently with contracts claiming 100% and them getting a fraction of this. The mere fact that we do what we say and honour our contracts is yielding a substantial increase in income for those customers. It is also very important to note that the 100% is the amount we bill BT and others. This is an insanely complicated process with an awful lot of opportunity for rounding error and assumption. For example, calls to hosted non-geographic numbers have income depending on where they not only enter the operator’s network but also where they originated on the BT network, i.e. there’s one of 60 different rates and which one depends on the co-incidence of 44m sources and the operators points of interconnect. It would be very easy for operators that are less technically advanced to assume a percentage split, or assume the lowest, but we bill every call fully. More importantly, the CDRs that we bill BT and others using are the same CDRs used for reporting to you and if you want them, you can have them. We’ll summarise this on a monthly spreadsheet but we’ll back it up so you know you’re getting 100%.
  • Distributed TDM. Routing of phone calls from BT is based on source so all calls to an operator from, say Edinburgh, would go to a defined operator switch reachable over a specific primary BT exchange. There is a backup BT exchange but not a backup switch on a different exchange. In crude terms were an operator to have a switch in London and another in the north of England, southern calls would logically be routed to London and northern calls would go to the northern switch. In the event of the northern switch being unavailable due to power, hardware failure or enthusiastic JCB-ing then calls from the north would fail until the operator telephoned BT and asked them to reroute. Now, many operators have more than two switches so the affected areas get smaller but the principle is the same – an outage at the operator switch is an outage for part of the country’s calls until a manual reroute is enacted by the kind people at BT. We don’t think that is good enough so do it differently! Instead of having switches around the country to improve our own economics, we have switches in Slough and London to improve your availability. The sites are 28 miles apart but connect to all the same BT exchanges. This means that our BT routing doesn’t need to change to handle an outage. Routinely half the traffic goes to each site and a site having an outage is simply a reduction in capacity as all traffic would naturally flow to the other site. We do not need to phone BT and there should be no resulting outage to service on your numbers. Naturally, we work hard to maintain head-room in our capacity for 100% fail-over.
  • Distributed IP. We’ve explained before how we operate The IP Network for Voice Business but in shorter form our network is built for voice. We’re not carrying a lot of traditional ISP traffic and mixing voice in and we’re not constrained by the economics that lead commodity networks to routinely congest links; something that is devastating for VoIP. Moreover, our voice services go where our network goes so we have three distinct IP sites, redundantly connected to each other and all three have our VoIP ‘stack’ and are capable of carrying our entire voice traffic should another have an issue. TDM switching is in two of those three. The failover is at multiple layers within our application stack as well for softer failures. We’d urge you to examine DNS and trace-routes from other wholesale providers and judge for yourself how distributed infrastructure really is as network maps show where the network goes, not where the voice kit is, and where the voice kit is doesn’t imply there is adequate capacity or independence from other sites to function in an outage.
  • Combined core. There are typically two types of operator in our space: those with a TDM core that have bolted on SIP around the edges and those who are all SIP, possibly with TDM bolted on at the edge. The former generally pass all media through TDM so SIP-to-SIP calls between on-net customers would be bridged in TDM, with all billing and routing logic handled on TDM hardware, and SIP around the edge for access to that. The all SIP people will generally run a soft-switch with application and billing functions on there with TDM possibly around the edge. Whilst we prefer the SIP core, neither is perfect and the reason why Simwood has adopted a combined core, giving us the best of both worlds. That means that all call routing and application logic is handled in our own stack, by SIP, whether the call originates on TDM or SIP. However, call media is handled on TDM hardware with any transcoding in hardware DSPs where we dynamically assess it is appropriate to do so. This enables us to route TDM<>TDM traffic for applications very hard to pass over SIP, such as modem traffic, whilst routing SIP<>SIP traffic using the latest and greatest features available. We introduced HD Voice to the network back in 2010, numerous anti-fraud features since and we will continue adding great dynamic features to our stack whilst offering the stability and speed of TDM and hardware transcoding where optimal to do so.
  • Wholesale only. We do not work with resellers / channel as we want our product to be enhanced by customers. We passionately believe in us and our customer adding value along the way for the end-user. Different customers add value in different ways, but they all add value. By contrast the channel resells a product that gravitates to the lowest common quality denominator. Similarly we do not have a retail arm so your customers will not be receiving a call from our “Local Business” team offering them opportunity to ‘come back’. Your own competitors may add value differently of course but you will not be competing with us!

We’re very confident that Virtual Interconnect Inbound is the single best proposition in the market-place for progressive ITSPs. Whether you have number ranges hosted elsewhere and wish to migrate them or wish to investigate getting your own number ranges, please get in touch!

Now, there’s one question that seems to come up a lot from people getting to grips with the supply chain here and we need to deal with it:

Do we use IPExchange?

There’s no polite way to answer that question normally but with the benefit of editing: NO!

BT IPExchange is BT’s answer to Simwood and our competitors. Whilst we could talk at length about the advantages we and our main competitors have over IPX it is really important to understand that we’re all at the same level in the food-chain as IPX, namely just as Simwood is fundamentally a SIP<>PSTN service, so is IPX. Simwood has switches in data centres with TDM connectivity to exchanges. IPX has SBCs in exchanges with IP connectivity to data centres. The fact IPX is offered by BT in no way levitates its position technically or commercially. Whether a Simwood switch or an IPX SBC, we both switch SIP to/from the PSTN over SS7. As as we stated above, BT is part of the PSTN as are we. BT is not the PSTN.

Whilst we know of customers who have been allowed to believe otherwise and we know of IPX users saying otherwise, BT’s IPExchange product is NOT a BT Interconnect and using it does not imply a Standard Interconnect Agreement with BT. IPX is a Managed Service whereas a Standard Interconnect is a regulated and mutually owned facility. The difference is immense!

Commercially IPExchange charges users £5k up front plus a testing fee which is likely to be at least the same level giving CAPEX of £10k+. That is after they’ve taken 20 days to decide whether you’re wanted as a customer. They then charge a few Pounds per concurrent channel per month, in or out. We charge no set-up fee for basic numbering, have accounts open within the hour usually and make no charges for channels.

Resellers lacking confidence in the value they’re adding themselves perhaps like being able to claim an interconnect with BT (which IPX isn’t) and to leverage their reputation. For wholesale customers who are confident of their own value-add and recognise the fact that IPX occupies no senior a position in the food-chain to Simwood or our competitors, and both provide a managed service, Simwood or our competitors are a more sensible option.

When it comes to Virtual Interconnect Inbound, the difference is more stark. We offer 100% of the wholesale income as defined in BT’s wholesale Carrier Price List (CPL). As a Managed Service IPX can make payments but they are set by IPX and lower than the CPL. Depending on the time of day and number range they can be as low as 13% of the wholesale CPL rate that we’d give you 100% of!

If your have more inbound revenue than outbound charges we’ll pay you. As IPX is its own business unit they don’t like customers who are cash-flow negative. This means you’ll need to pass termination traffic to IPX just to have access to your own income. Before you conclude that is ok, be aware that BT outsource termination to Tata, and Tata offer multiple service levels. BT IDD which is available over TDM and is used by Simwood and many major mobile networks is triple the price of IPX for some routes. It therefore follows that they are not the same routes! BT IDD is one of many carriers we use and we can choose the best one for each destination. Further, with Simwood you can choose the best service level on a call-by-call basis. With IPX you get what you’re given and need to use it if you want to access your income.


We’d also question the use of the words “IP Exchange”. From an IP perspective IPX SBCs are buried deep in BT’s network and from our testing are several hops from the BT edge. That means that even if you operate your own IP network and are large enough to peer with BT, your SIP/RTP traffic will pass a long way over their network, mixed in with retail and general traffic. You can of course pay BT for a direct connection to the remote exchange! Our equipment is in data-centres and where other networks peer with us our VoIP equipment is very near the surface – typically one or two hops inside our edge.

An “Exchange” is widely considered to be a facility which facilitates transactions between parties and takes a fee for doing so – think London Stock Exchange or non-financially the London Internet Exchange. If two CPs connected to an exchange of that definition you might expect them to agree financial terms between themselves and each pay a fee to the exchange for the value-add of enabling and possibly settling the transaction. You would not expect the exchange to dictate terms to them both in a price-list, neither be aware of the others presence on the exchange, and the exchange to make a margin on the transactions. We cannot think of any exchange in the world that operates in this manner and a cynic may say that IPX is the traditional minute-based business model packaged to look contemporary.


We’re very open about our reliability and distributed nature. We would encourage potential customers to speak to IPX users about their experience to date. We have mutual customers and customers won from IPX and we know what they tell us! By pure co-incidence, in writing this we were looking for some facts and the BT Website was unavailable.

Financially, of course BT are huge and in a developing industry some may prefer the solvency of a large player. They have us there as we’re microscopic by comparison. However we are profitable and growing with a solvent balance sheet. As recent results show BT are losing revenue and their balance sheet shows negative net assets of £2.9bn. Whilst huge compared to us, they only this week joined the largest top 100 operators in the world according to Total Telecom which gives some perspective. We work with several of the genuinely big operators.

Finally, we believe in open and transparent innovation. We like to educate our customers and we like to learn. Along the way we happily spend money for valuable IPR in quality products and we make extensive use of the superb Open Source efforts which have enabled the VoIP industry to gain ground. We therefore think it would be entirely inappropriate for us to claim patent royalties from that industry and especially our customers!

It is your call!

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