TABLE OF CONTENTS The following net present value model is provided to demonstrate net present values when Class 4 vendors drastically lower their prices. This model reflects a sale price of $50 per DS0 for the Class 4 switch. In order to transmit voice over an IP network, the Class 4 switch also requires a VoIP gateway, as detailed in Table 11-30. Table 11-31 shows the operating expenses for Class 4 at $50 per DS0 versus softswitch. Table 11-32 outlines the costs and benefits of buying Class 4 at $50 per DS0 plus a VoIP gateway. The net present value of Class 4 at $50 per DS0 with a VoIP gateway versus softswitch is covered in Table 11-33.
| Components of cost | Class 4 DMS-250 | Softswitch Convergent Networks ISC2000 |
|---|---|---|
| System | $50/DS0 4,032 + VoIP gateway at $182,000 = $383,600 | $225,000 |
| Installation | $15,000 | $9,000 |
| Total (P = Co) | $398,000 | $234,000 |
| Components of cost | Class 4 DMS-250 | Softswitch Convergent Networks ISC2000 |
|---|---|---|
| Collocation rent (annual) | $48,000 | $12,000 |
| Labor | $85,000 (engineer) | $70,000 (technician) |
| Maintenance contract | $38,360 | $22,500 |
| IP circuits | $1,080,000 | $1,080,000 |
| Total | $1,251,360 | $1,239,100 |
| For life (j) of 2 years | $2,502,720 | $2,478,200 |
| Income tax component | Class 4 | Softswitch |
|---|---|---|
| Gross... |
