Asterisk creator and sponsor Digium put the mass market squarely in its sights today with its acquisition of three year-old Asterisk PBX company Switchvox.

While Asterisk has earned a devoted following among technology experts, the formidable challenges of implementing the open source telephony system is a barrier to wide adoption. Earlier this year, Digium took a first step toward greater simplicity by introducing the AsteriskNow appliance. Now the company is adding to its portfolio a feature-rich turnkey PBX that claims 66,000 users (seats).

“If you look at where Asterisk has been adopted, it’s a technically sophisticated audience – system integrators and enterprises, organizations that have the telephony expertise and technology expertise to use Asterisk,” explains Digium CEO Danny Windham.

“We have been looking at things that are necessary to grow the business. The most important thing is making it easy to use – packaging it for small and medium sized applications. Switchvox has made it [Asterisk] really easy to use.”

Digium looked at about 30 different packaged PBX offerings before finally deciding on the Switchvox acquisition, according to Windham. “Switchvox had the most reliable product, the most functional product and the Switchvox team is culturally compatible.”

He points to the value-add that comes built-in with Switchvox’s product as significant customer benefits.

“Take the example of a small business, a real estate office running Switchvox PBX and a CRM system like Salesforce.com or SugarCRM. When the phone rings, the customer record in the CRM system is displayed. It also brings up Google Maps showing the caller’s location and opens up the caller’s URL. Before answering the phone you know who’s calling and the whole history.”

But does this move put into question Digium’s commitment to the open source community? An emphatic ‘no’ is Windham’s answer.

“Digium is spending more today to support the open source project than anytime in its history,” he says. “The stronger the [Switchvox] business is, the more resources we have to apply to open source projects.”

At the end of the day, Switchvox and Digium appears to be a marriage made in heaven, albeit a long distance marriage, as the Switchvox team will remain in San Diego as Digium’s western regional office.

“We believe Asterisk is the most popular open source IP telephony system out there,” Windham says. “We believe that Switchvox is the most popular open source PBX out there.”

Chances are you worked from home recently.

Whether it’s working out of a home office occasionally or running a “virtual” business headquarters fulltime from a home office, an increasing number of us are doing business over consumer-grade Internet connections — and probably experiencing some degree or another of frustration.

For example, maybe you’d like to cut the Microsoft Office cord and use on-demand office applications. Now, your experience may be different from mine, but I’ve found trying to create or edit a Web-based spreadsheet, for example, was so slow that I could get a cup of coffee between keystrokes. Imagine editing a document with the same response as filling in an online form and you’ll get the picture.

Of course, I’m not the first person to notice this. Broadband service providers have been paying attention and looking for ways to bring business-class connections to the work-at-home masses — and realize heftier profit margins into the bargain.

A while back, Covad, as part of its blogger relations program, made me an offer I couldn’t refuse: a T1 connection to my home office. I’ve been using it for about three months. (More about my experience later).

This got me interested in whether T1 to the home was going to be the Next Big Thing. After all, Covad was one of the first to offer broadband service.

“Covad was a broadband pioneer in the 1990s,” comments Infonetics Research Principal Analyst Stéphane Téral. “They have been on the cutting edge for a long time.”

“There are a lot of Silicon Valley execs worrying that Silicon Valley is losing its edge. In other parts of the world you can get 10 megabits for what you pay for one megabit here. So this is part of saying, ‘We got the message and now we’re doing something about it.’”

The advantage of T1 isn’t strictly speaking speed. Cable download speeds are much faster. The advantage of the T1 is on the upload — 1.5 megabits, twice as fast as DSL and about four times as fast as cable — and guaranteed bandwidth and uptime. Plus, T1 service isn’t distance-sensitive like DSL — something Comcast’s reptilian Slowskys keep reminding us about.

While the price for T1 service has dropped by about 75 percent in the last 15 years, at $300 to $400 a month for entry level service, T1 to the home probably isn’t going to appeal to consumers, other than perhaps the most hardcore gamers.

It’s the business market that providers are aiming for.

“There are something like 11 million small businesses in the U.S. and the majority are fairly small,” explains Jake Soder, Speakeasy’s Director of Product Management. “They don’t have a huge opex budget, but they’re looking for something more than just some Internet bandwidth.

“More and more people are saying, ‘I can’t afford downtime,” he continues, ” and the answer to that is a T1.”

That’s because increasingly the Internet is the basic enabler of business operations, the way the telephone used to be. That brings the dependability of the bandwidth to the fore, and that’s another place where T1 cleans DSL’s and cable’s clocks with service level agreements guaranteeing mean time to repair in minutes and hours instead of hours and days.

“They’ve become more interested with the advent of video, Skype,” says Simon McIver, Covad’s Director of Marketing. “They want a high quality service, [with bandwidth] locked. With DSL, the moment school gets out, the DSL slows down.”

Converged communications and VoIP are other drivers.

“SMBs are prime candidates for the cost-savings of VoIP,” says Speakeasy’s Soder. “When you put a couple of phone calls on 384 kilobits [cable’s upload speed] you’ve started to choked your upload, or you end up with dead spots.”

Other good candidates are businesses with high throughput requirements; for example, law offices sending large PDF files, video and audio production companies, VPNs, hosting websites, and of course, duplicating the desktop experience for those on-demand office applications.

And the potential market is growing beyond the usual suspects.

“We have non-traditional users entering this space that we didn’t see two or three years ago,” reports Covad’s McIver. “Businesses you would normally not expect [to be bandwidth dependent]. Auto body shops have applications where you look up parts and schematics online.” If the system is down, they’re not working.

While prices have come down dramatically, don’t expect to see $24.99-a-month T1 services anytime soon. “Our goal is not to get into the death spiral price war,” says McIver.

Instead, providers are looking to compete with value-added services.

“It’s a platform for managed services and VoIP products,” explains Speakeasy’s Soder. “It continues to be our preferred method for our VoIP product. We’d prefer to have everyone on a T1 to have the guaranteed uptime for phone service.”

“As a broadband provider we can provide value-added applications like security, email, web hosting,” says Covad’s McIver. “At the end of the day it’s not about speed — its consistency and dedicated bandwidth.”

So how is my T1 connection working? Here’s the report so far.

First, I haven’t needed any of the premium service that comes with the premium connection. It’s been a no-brainer from that perspective. Which is good because of item number two: it’s not easy to set up. I had to call out my telecom engineer friend to reconfigure my router to get the whole set-up to work.

The Schuk MMOG lab reports that the performance is “like, incredible” in a series of high throughput tests including Counterstrike and World of Warcraft, conducted daily from about 10:00 p.m. until the wee hours of the morning.

But how are your VoIP calls, you’re asking. Because the online gaming isn’t usually going on when I’m on the phone, there wasn’t a noticeable difference. However, if you’re uploading large files — video or audio, for example — the performance improvement is significant.

Covad is working on the user experience, according to McIver. “Our goal is to make this easy to buy, easy to set up and easy to get support.”

Skype has had its share of bad news lately, with a malware attack following close on the heels of a massive outage. Current events raise questions about Skype’s technology that won’t — and shouldn’t — go away.

One is the perennial architecture question: proprietary (Skype) vs. open (SIP). Recently I asked SIP application company Counterpath’s CTO Jason Fischl to talk about it. Fischl was also the architect of TelTel’s SIP-based VoIP system.

“When you’re trying to design a system to scale there are two places you can have a problem: design of the protocol or in a bug in the implementation,” he explains.

And quite simply, in protocol design as in so many of life’s other arenas, numbers count.

“In the case of SIP we have protocol design by people who’ve been designing telecom protocols for many years.” People like Cisco and Nortel telecommunications engineers, who have generations of experience with the problems that can crop up in communications networks.

“In the case of Skype, they have a very small group,” he continues. “The advantage [for Skype] is that they can make it simple. But a lot fewer people are looking at it. It’s a monoculture. The same group of people are making all the decisions — and the decisions are made for tactical reasons rather than technical reasons.”

And then there’s implementation execution. Here, too, more is better.

“When you see the problems Skype had, you see the advantages of SIP. In the case of SIP, you’ve got hundreds — even thousands — of implementations. Lots of service providers implement SIP. Any problem they have isn’t going to affect the entire population — just their customers. Lots of different vendors implementing is a nice benefit.

“But the consequences of a flaw in the case of Skype — it’s a catastrophe,” adds Fischl. “There are no other implementations.”

Fischl suggests that Skype’s outage may have had more to do with the centralized aspect of Skype’s architecture than the peer-to-peer dimension. “One of the [problematic] things about their [Skype’s]architecture is that the authorization of users is done on a central server. That leaves open a vulnerability.”

SIP, by contrast, has a distributed authorization process. “It relies on an overlay network. You make a query into the overlay network and find out how to contact subscribers.”

Further, the IETF’s — Internet Engineering Task Force — peer-to-peer SIP working group is looking at an architecture that will do complete peer-to-peer SIP without a server at any point.

“One of the fundamental requirements is that you won’t need a central server when you login — only when you sign up. The consequence is that if servers went down you wouldn’t get new customers, but customers can still make calls.”

Fischl confesses to being puzzled that Skype hasn’t embraced SIP. “To being with, they’ve already got SIP gateways — why not go further down the road? I think if they took that approach — augment the network, let any SIP endpoint connect — they’d have a huge network of vendors building devices.

“Who knows?” Fischl adds, “Maybe they’re going down that road.”

PhoneGnome customers can relax. The feared service interruption that users were alerted to last night likely won’t materialize. And besides, if the VoIP service doesn’t work, with PhoneGnome you always have the fallback POTS.

Yesterday evening, the company sent out a notice that one of its providers was shutting down operations on August 31 — TelEvolution deserves credit for coming out with the information before customers experienced problems. Because this provider hosted a significant part of TelEvolution’s traffic, the development could have had a massive impact on the VoIP provider.

Today it’s looking like the worst can be averted.”Other partners are stepping up and it’s looking like it’s only going to be a minor disruption, if that,” says TelEvolution CEO David Beckemeyer.

In the future, disruptions of this type will be even less likely, according to Beckmeyer.

“We’re working with a better vendor — Hurricane Electric — that offers better service guarantees. But,” he adds, “we’re paying five times as much.”

There’s a warning here for other VoIP providers, says Beckmeyer. “The way the industry is set up, individual companies can pull the rug out from under you overnight. A lot of VoIP players are one step away from the same thing.”

The most entertaining explanation I’ve heard about last week’s Skype outage is this posting from Rostislav Siryk in his blog:

“Skype’s outage is …[a] natural consequence of quantum physics. Because users [are] like atoms.”

In other words, it’s within the realm of possibility that all the world’s PCs will download a Microsoft update and reboot at the identical moment.

On the other hand, when was the last time you saw an object move by itself as a result of all its atoms just happening to tip the same direction?

I thought so. That’s why many are saying Skype’s explanation, issued this morning, is fishy.

Certainly, no one at Skype or Ebay is saying much. My request for a real live conversation last week was answered politely with a copy of the company’s then-current statement and a link to the Skype blog. As Skype has talked with me openly in the past, it’s thought provoking at the very least.

But this discussion begs the question. Even accepting the Microsoft-did-it explanaon, the outage is nonetheless an object lesson for the entire VoIP industry of another immutable natural law: Murphy’s.

It highlights a fundamental industry problem, says VoIP gray-beard Erik Lagerway. Providers ultimately don’t control the underlying network that delivers their service.

“I’ve been in this business 15 years and over that time VoIP has been in beta 15 years. The main reason is that the network that people are riding on is unreliable,” says Lagerway, whose VoIP pedigree includes executive roles at Shift Networks and Eyeball Networks as well as founding Vocalscape Communications and Xten Networks (now Counterpath).

Unless a provider owns the upstream broadband network, a ‘best effort’ service is all a provider can promise, according to Lagerway.

“If the upstream provider has decided they’re going to be making some changes, you’re going to be feeling those changes. If the upstream provider decides they want to filter out [other providers’ VoIP] packets or handle them with less priority than their own packets, you’re going to experience that regardless of what kind of service you have.

“If they decide they’re going to route packets to Istanbul, they can do that,” he says, adding, “The long and short of it is that the incumbents have their long arm deeply inside the network.”

Having said that, Lagerway does allow that Skype’s proprietary peer-to-peer (P2P) architecture – a closely guarded “black box” — leaves the system unnecessarily vulnerable in a way that conventional centralized services like Vonage don’t.

“My main issue with Skype is that it’s a closed system,” says Lagerway, an outspoken evangelist for the open communications standard, SIP. “Having one guy [Janus Friis] create the entire peer-to-peer architecture, it’s destined to fail – no one is smart enough.

“What’s going to happen when the next Windows update comes along? What this says is that, at any given moment, Microsoft can screw over every single Skype user. That’s a serious problem. The fact that no one even thought of this is mind-boggling.”

Lagerway points to Skype’s implementation – a self-organizing P2P network operating exclusively on users’ PCs – as untenable for providing a service to millions of users.

“To have such a dependency on so many people’s PCs, that’s pretty risky business. What happens if a whole lot of people decide to de-install?”

A better approach for a P2P network is an architecture that fails back to a centralized client-server network – the way TelTel’s P2P VoIP network operates, for example. “That’s the way SIP operates,” Lagerway explains. “It’s a peer-to-peer network but it bootstraps the operation with a client-server network.”

In the end, while no one can ever fully escape Murphy’s Law, a more open approach could have helped Skype avert this particular disaster, Lagerway says.

“If this [Skype] had been an open standards projects, you would have had much more peer review. If they had used SIP, this particular outage would have been less likely. It could have possibly been averted,” he explains. “Correcting it now is going to be costly.”

The legendary Murphy could have told Skype that, too.