How to start your own VoIP termination business?

Voice over Internet Protocol (VoIP) is a fast growing industry that holds great potential for revenue and growth. People love VoIP because it is flexible, inexpensive, and convenient. It is a great way for businesses and enterprise level organizations to make long distance calls and to utilize other important phone services. Within a few decades it is predicted that VoIP will completely take over traditional telephony methods. Those looking to start a VoIP business may be tapping into a gold mine. Buying and reselling wholesale VoIP equipment and services can be a highly lucrative practice.

What is wholesale VoIP termination Business?

Wholesale VoIP providers receive traffic from one carrier and transmit it to another one acting as a ‘man in the middle’ between them. VoIP wholesale usually doesn’t require huge initial costs and might be highly lucrative if done right.

Requirements for VoIP termination business

To deploy wholesale VoIP termination services the following are required:

• Hardware equipment
• Softswitch
• Trac suppliers
• Clients – trac consumers or other resellers

Equipment for VoIP wholesale

Based on the traffic you are going to operate with, you should choose the type and quantity of your equipment.

To begin your service, you can start with the following:

• Billing server for invoicing and nancial data processing,
• The server that combines RTP for trac streaming and RADIUS intended for centralized authentication, authorization, and accounting management for clients to connect and use a network service.

With the increase in the traffic volume, you may separate your RTP and RADIUS server.

Softswitch selection

It is necessary to choose the high performance and stable soft switch solution as it is the central device of a VoIP network.

Billing is an important part of the network that collects information about calls and other services. CDR (call detail record) reports generated by billing are used for charging clients. If the softswitch doesn’t have integrated billing, it is necessary to buy it as a separate solution.

You should also pay attention whether the softswitch supports protocols and codecs you need. If they aren’t compatible with the softswitch, the trac won’t be proceeded. Sometimes clients and suppliers use different protocols and codecs. In such case it is necessary to convert them. So, the best option is when your softswitch not only supports protocols and codecs, but converts them.

Another important feature is LCR (least cost routing). Due to LCR option the softswitch automatically selects the most cost effective path for traffic.

Some softswitches can have additional functionality which helps in operation and saves time (for example, reports generation, automatic invoice generating and sending, trac analyzer, trac quality control system, etc.). The following gure illustrates typical setup of a VoIP wholesale provider.

Suppliers and Clients

Suppliers and Clients are the main contractors in VoIP wholesale business. The provider buys international VoIP traffic from their Suppliers and sells it to Clients. One VoIP company can be both your Supplier and Client.

Traffic as a product

Generally, VoIP traffic is the flow of data through the Internet. As any other commodity traffic possess specific quality characteristics which determine its demand and price. Quality means that users receive an acceptable level of voice quality without unwanted sounds.

There are specific parameters used for estimating traffic quality in VoIP wholesale business. The main of them are ACD (average call duration) and ASR (answer seizure ratio). The better the quality, the higher the demand and, of course, the price.

Making money

As we have found out, the core of VoIP wholesale business is VoIP trac transit from one carrier to another (from origination side to termination side). You get prot from margin between buying and selling prices.

If you are interested in starting VoIP wholesale business, our company, Denovo Labs, is ready to help you. We specializes in VoIP wholesale business and VoIP softswitch solutions development, so feel free to contact us.

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About Anne Kwong