I see this trend similar to what was experienced in the cell phone industry. Few will dispute that analog cell phones like "The Brick" actually offered superior call quality than today's sometimes spotty digital coverage.
Why did the change to digital occur then? Cost. Pure and simple. Whereas analog service consumes a huge amount of network resources, digital is quite efficient. What is lost in quality is more than made up for in cost.
If call quality was 99.999% with analog, but for less than 50% of the cost you could have 99% quality/QOS, etc, would you take it. Many customers say YES!
The biggest benefit of IP so far that I see is:
reduced cost of cabling (One drop vs two)
data driven applications (which are few and far between for most companies)
linking locations together
remote users managed easily
reduced MAC charges, ease of administration (This depends on the system of course-but overall, yes it's true)
and the ability to interface with SIP trunking.
I am going to a SIP forum put on by Cbeyond tomorrow, and they are a decent integrated provider in our market. With SIP, you can plug staight into the PBX and avoid the cost of the PRI card. SIP trunks acts as an emulator and can run over your data connection. Some interesting options coming with that service, and even though it's costly to implement on my current system offering, I know it's only a matter of time.
In some cases the cost of the actual phones are still more than traditional TDM, but that will soon change. It's the other factors listed above that affect the TCO (Total cost of ownership) that business owners HAVE to take into consideration.
If they are going to save a ton of money, they will do it for slightly less quality. They have already proven that with cell phones if the financial case is compelling enough.
