Lion switches off phone system, turns to internet

By PETER GRIFFIN

Brewing heavyweight Lion Nathan has upgraded the communications setup at its large Auckland site with a move to a full internet protocol network.

The company has implemented Cisco's architecture for voice, video and integrated data (AVVID), merging its data infrastructure and telephone switch on to the one network.

The 400 Lion staff based at the site are now able to make good quality VoIP (voice over internet protocol) phone calls to the smaller Wellington site, saving the company in toll calls.

Speaking to the Herald via a VoIP link from Lion's Sydney site, chief information officer Darryl Warren said that after moving staff into a new building, Lion had the option of replacing its 15-year-old telephone switch with another conventional switch or moving to IP.

"We were faced with the choice of putting in a conventional switch or IP telephony, which economically and in terms of future-proofing was a better choice," he said.

Lion was now piloting VoIP between the Auckland and Sydney offices, but the costs of readying the Sydney operation for such a move had to be weighed against the savings that would be made on voice and data traffic.

"It's a matter of building a business case for doing it," said Warren. "It's not an insubstantial job because there are lots of desks in Sydney."

He would not say how much the roll-out in Auckland had cost. Cisco's New Zealand manager, Tim Hemingway, was also keeping mum on how much the contract was worth.

But he said the move to IP would ultimately cut Lion's communication costs.

"Their savings are not just in toll costs but from a support perspective and their ability to re-use the resources that they've got," he said.

The Lion project was one of the bigger corporate IP roll-outs for Cisco. Several other companies were trialling variations on the Lion theme.

Cisco's accounts for the year to July 31, 2000, were filed at the Companies Office last month and show a profit of $187,000 on revenue of $6.6 million. Figures for last year have not yet been filed.

But Hemingway said the accounts did not show the full picture. Revenues extracted from the New Zealand market were in fact much higher.

"That doesn't actually reflect our revenues at all. Being a US company, our [revenue] is amalgamated back into the US.

"We were ahead of our target and we're seeing good growth, particularly in the IP telephony space but also in the wireless LAN area."

He said the Lion contract was the first time Telecom has been involved as an integrator. Traditionally Cisco had partnered data integrators.