Twilio: Connecting Enterprise Telecom To The Cloud

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Software is eating the world, observed venture capitalist Marc Andreessen, and Twilio's software is ready to dine on enterprise communications.

At Enterprise Connect in Orlando on Monday, Twilio announced the general availability of Elastic SIP Trunking, a service that provides a way to use Session Initiation Protocol (SIP) to connect corporate communication infrastructure with telecom dial tone and cloud services.

Twilio launched the service in beta in November 2014. Graduation to general availability brings a service level agreement (SLA) and the addition of several security features: Encrypted media (SRTP), dedicated connections (MPLS), and emergency services calling (E911).

"Nearly half of every IT dollar is spent on communications, yet it's such an old field," said CEO Jeff Lawson in an interview. "It's still tied to this 150-year-old infrastructure that it runs on. So we have this opportunity to turn it all into software, and let it run at the pace of software."

(Time-division multiplexing, through which multiple signals share a single wire, is based on telegraphy techniques developed in the 1870s.)

Elastic SIP Trunking allows companies to provision a SIP trunk on demand to handle communications, through a website or API, with inbound numbers in more than 50 countries and outbound calling everywhere. It consists of Twilio's core connectivity service unbundled from its other offerings, for organizations that already have a PBX, a call center, or a cloud PBX from the likes of Asterisk.

The service features pay-as-you-go pricing (termination $0.004-$0.008 per minute), secure connections via MPLS or TLS/SRTP, E911 support, SIP Registration, numbers for SMS/MMS, data-driven routing, one-click call recording (per-minute charge per recording stored), TwiML-scripted failover logic for local outages, and multi-tenanted SIP trunks with per-tenant billing records and logs.

"In the past you'd be buying gear or time-shares of telco gear, but with Twilio we're pure software," said Lawson. "What we're doing invites much more flexibility, because we're not asking you to spend millions of dollars up front or sign long-term contracts."

Twilio offers the building blocks of communication services in the form of APIs that developers can assemble to meet the specific needs of their organizations. According to Lawson, the company has more than 500,000 developers implementing SMS, VoIP, and voice services for their applications through its cloud infrastructure. Lawson said Twilio's platform is used by companies such as Coca-Cola, Home Depot, OpenTable, Nordstrom, and Uber.

[ Check out what Google has planned for its new wireless service. Read Google's Wireless Service Taps WiFi and Cellular. ]

In the past, Lawson explained, enterprises bought monolithic applications from vendors such as Microsoft and Oracle. Decisions about those purchases, because they could cost millions and take years to implement, were handled at an executive level. A decade ago, he said, that began to change with the shift toward software-as-a-service, which allowed heads of sales and CFOs to purchase software for their lines of business without the involvement of IT.

Developers are able to provision services through Twilio's APIs very easily and can create advanced solutions that meet their needs, said Lawson. "And it's not $2 million to get started, it's a dollar," he said. "They can bring these tools to bear, and in doing so that's changing how enterprises make buying decisions about software."

Michael Finneran, principal at dBrn Associates, argued that old buying patterns still matter. Twilio, he said in phone interview, "could have a foot in the door, but it's the wrong door. Certainly they're a fast-moving company and well-respected, but not in the part of the world that buys SIP trunks."

Finneran contends that Twilio will have a hard time competing against the enterprise sales forces of large telecom equipment providers like AT&T and Verizon.

Twilio however won't only be relying on self-service customers. A spokesperson said in an email that the company will be working with channel partners and resellers to make Twilio Elastic SIP Trunking available for every business.

Software may be eating the world, but Twilio has to deal with enterprise diners who just want to order the usual.

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