Businesses are always looking to save money and improve their bottom line. Cloud-based hosted VoIP is a simple way to do both at the same time by reducing your monthly phone bill and improving productivity with business phone services.
With so much changing technology and the increase in remote work teams, it is not surprising that businesses need more phone features and functionality than ever before. But as the number of employees in your business grows and the complexity of your operations increases, you might be surprised by how quickly your monthly bill can rise!
VoIP is a solution for businesses looking to save money on their phone service.
What is VoIP?
VoIP stands for voice over internet protocol and is a type of telecommunications technology that uses an internet broadband signal to send and receive calls. As we will see, VoIP offers users much more than a simple phone system and supports features far beyond what any other commercially available product provides.
Believe it or not, VoIP's first came on the scene in 1995, when professional and hobbyist developers recognized there was great potential in sending voice data packets over the internet. They figured that by doing so, they could avoid costly long-distance charges and provide an overall cheaper alternative to the options that existed at the time.
As you might have guessed, the first iterations of VoIP technology were plagued with poor audio quality and required both participating parties to have the same VoIP software installed on their computer. Not especially practical for businesses.
VoIP’s big breakthrough came several years later when Cisco Systems and Nortel began producing VoIP hardware equipment that was capable of 'switching' a data voice package into something that could be read by a public switched telephone network (PTSN).
This was a major development and meant that VoIP technology could be used to send and receive calls from conventional phone lines, which was a significant limitation of the service up until that point. On top of this, broadband speeds began to increase exponentially, resulting in voice quality comparable to the standard copper phone lines.
These days, VoIP software comes with a wide array of features that far outnumber those offered by alternative systems.
Phone Systems – Everything you should consider before changing your business phone system.
What Type of Phone Systems Are Available Besides VoIP?
Phone technology has come a long way since Alexander Graham Bell, and these days most small businesses will have the choice between four types of systems. Since we have already looked at VoIP, we will focus on the other three leading options, which include analog, digital, and hybrid-digital/PBX systems.
Most standard phone lines use analog technology, which is supported by a copper wire infrastructure. These phones use a vast network of telephone poles and wires to send and receive voice signals.
Although analog phones offer basic features such as caller ID, call waiting, and even conference calling in some cases, they lack most features that digital and VoIP systems provide.
- Copper wires provide high voice quality.
- Very reliable, as phone lines will not be affected by a down internet connection.
- Having many separate lines can be expensive.
- Limited functionality compared to VoIP and digital systems.
- Hardware is non-modular, meaning changing a system requires disassembly and reinstallation.
Digital, or PBX, phone systems are similar to VoIP in the sense that all calls are made via a broadband connection and not copper wires. However, traditional PBX systems don't have all the same features offered by VoIP and have the added disadvantage of expensive hardware and low scalability.
Like analog, once a digital system has been completely installed, changing can be both costly and time-consuming.
- Many more features compared to analog systems.
- Adding additional lines is more cost-effective compared to analog.
- Hardware and installation require an initial investment.
- Changing a system once it has been installed can be expensive.
- Still provides fewer features than VoIP.
Avoid the big mistakes most businesses make when looking for a business phone system. Read the FREE Simple Guide to Business Phone Systems.
Some manufacturers of digital phone systems have attempted to shorten the gap in service between VoIP and PBX phones by creating a hybrid system. These hybrid systems offer many of the same features as VoIP but are generally still more expensive and require an initial investment in hardware, software licensing fees, and installation.
As with standard digital/PBX systems, they’re not very modular, and upgrading the system can require further installation work and purchasing more hardware.
- Includes many of the features that VoIP systems do.
- Is superior to both standard PBX/digital and analog systems.
- Still more expensive than VoIP systems
- More challenging to modify and maintain than VoIP.
- Hardware may require upgrading every few years.
What Features Does VoIP Offer?
As noted above, one of the most significant selling points regarding VoIP is the number of valuable and impressive features it provides. While it’s true that each provider offers different packages, there is a core group of functions that all decent VoIP packages will offer.
Call Routing: Call routing allows businesses to direct incoming calls to the appropriate department or extension number based on a set of predefined criteria. Not only does call routing provide a better customer experience, but it also saves businesses time.
Anonymous Call Blocking: Many businesses won't answer incoming calls with an anonymous caller tag. With VoIP, anonymous calls can be blocked outright.
Call Analytics: Most VoIP systems provide users with analytical data, including items such as where most people are calling from, how long the average call runs, and much more.
Unlimited Calling: Most VoIP packages offer unlimited calling within both the United States and Canada.
Call Screening: Call screening provides users with the ability to filter calls based on a predefined set of criteria.
Hot Desking: Hot desking allows people to access their user account from nearly any device connected to the internet.
Conference Calling: All VoIP systems allow users to conduct conference calls of three people or more.
Voicemail-to-email: Voicemail-to-email services will send a voicemail directly to the user's email account, where they can download and listen to the message. This feature is convenient because it means people can check their voicemail without having to log in.
Call Queuing: When call volume is high, not all calls can be serviced at once. When this happens, users are put into a queue, and their calls are answered in the order they were received. Some systems even provide a callback function. The client's phone number is saved, and when their turn comes up, they receive a callback, meaning they don't have to spend the entire wait period on the phone.
SMS Text Messaging: VoIP phones can send SMS messages to regular mobile phone numbers without any issue.
Interactive Voice Response (IVR): IVR has callers interact with an automated voice menu to decide where best to direct their call. Like call routing, this function can help businesses save plenty of time.
Online Faxing: These days, most people email copies of documents instead of faxing, but some businesses and institutions still require some documents to be faxed. Most VoIP services provide users with a fax number that they can use to send and receive documents.
1-800 Number: 1-800 numbers allow customers to call a number free of charge. VoIP systems allow users to create their personalized 1-800 number.
The items listed above are by no means an exhaustive list of features, and the majority of VoIP systems offer a much greater number than this. However, the ones we have covered here are some of the most common and essential capabilities that all quality VoIP systems are likely to provide.
Advantages and Disadvantages Of VoIP
As with anything in life, VoIP has its own set of advantages and disadvantages that should be understood before anyone considers using VoIP technology in their business.
- Inexpensive compared to other systems.
- Adding additional lines costs significantly less than analog systems.
- HD voice quality.
- Significantly more features than analog or digital phone systems.
- Long-distance calls are either free or very cheap.
- If the internet goes down, VoIP will not work.
- Voice quality is subject to internet quality.
Still have questions? Find out how to choose the best phone system for your business in The Simple Guide to Business Phone Systems.
What to Look for In a VoIP Provider
When looking at different VoIP providers, several factors should be taken into consideration.
One of the primary reasons people decide to switch to VoIP is to save money. Even though VoIP is much more cost-effective than other systems, not all providers have the same price. When comparing costs, it is important to look at:
- Set up fees.
- Contract commitment lengths.
- Long-distance charges.
- Monthly service charges.
- Different features and options packages.
The ability to easily change and modify a VoIP system is one of its best features. Because of this, you don't want to choose a package or provider that makes it difficult to scale up or down as the business grows or changes.
In today's world of remote employees and 24-7 operations, it's crucial to be able to answer calls regardless of where you are. Because of this, it's best to pick VoIP providers whose product is compatible with mobile devices and tablets.
Before deciding on a provider, it's best to make sure they offer all the features your business requires.
As with any electronic system, issues are bound to arise at some point and when they do, having quality support becomes a big deal.
6. Voice Quality
Voice quality can vary quite a bit between different vendors, and it is recommended that a system be tested for voice quality before being decided upon.
As we have seen, VoIP is beyond a doubt the best phone system available. Not only will it lower a business' phone bill, but it also provides a phone system that simply outperforms all alternative options available.
Are you looking for a phone system with all the features you need in one easy package while saving you money every month compared to traditional landlines?
Get the answers you need by speaking with an experienced MCTV BusinessPro team member that will help you discover the best phone system solution for your business and your budget.
Click here to claim your free business phone system consultation to discuss your phone system needs. No commitments. No pressure. Just advice.