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How to save money with hosted VoIP

Jan 15

Posted January 12, 2015 by  Tim Pat Dufficy


Shrouded in mystery and misinterpretation, hosted VoIP solutions are often suspiciously absent, or very low down, on SMEs' list of virtualisation opportunities.

Migrating from the Public Switched Telephone Network (PSTN) or an on-site Private Branch Exchange (PBX) doesn’t happen by chance, it’s a conscious choice, and one that should be being made by any business looking to maximise productivity and efficiency while minimising costs. So what's stopping them?

In this post we take a look at what you really need to know about VoIP technology, address the common misconceptions and remind you of the potential benefits to your business.

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What is VoIP 

VoIP is a simple concept really, it’s voice transferred over the internet. Most people get this. Understanding starts to break down, however, when suppliers start talking about how this VoIP thing interfaces with the 'normal' telephone network. Eyes glaze over at the mention of PSTN and by the time the words 'call termination' are uttered its game over - VoIP is clearly too complex and therefore too risky.

Only it isn’t. On the contrary, understanding these concepts is not a necessary precursor to making a sound choice of supplier, migrating to a hosted solution and reaping the cost and feature benefits that modern VoIP has to offer. 

The biggest misconception about VoIP

Poor call quality - let's cut right to the chase and tackle the biggy. Lots of people have had negative experiences with VoIP call quality. For some, their experience is limited to Skype, which, as a (fantastic) free to use service, doesn’t make call quality promises. Others have tried VoIP handsets somewhere and been disappointed. Whatever the cause, VoIP is still yet to wrestle free from its call quality shackles. 

It's a fact that VoIP runs first over your internal network then the internet to its destination. Limitations in the bandwidth available on either network (which are shared with data communications of course) and the uptime/reliability of both can impact VoIP service availability and, on occasion, call quality, This is however an acceptable compromise given the number of users, lines, extensions and features that can all use the same low cost connection to the world.

With the normal phone network you can pay for guaranteed call quality on a line by line basis. If you want more lines, you pay more. Call quality will never be degraded but if there is no line free you can't make a call anyway. 

Essentially, what we are getting at is that a comparable system, in terms of users and parallel external telephone lines, will cost a lot less on hosted VoIP that it will on PSTN and this is even before we take into account call costs and other benefits. 

How Hosted VoIP saves you money

If call quality is, under some circumstances, less reliable than fixed line, PSTN telephony, the cost savings of VoIP need to be pretty compelling, don’t they? Fortunately, they are.

First of all, there's no capital outlay. You can buy VoIP as a utility, just like you buy computation in the cloud - this can include the central infrastructure and even the handsets. Then there's call costs. All internal calls will be free. All VoIP to VoIP calls on the same provider will be free. And, thanks to the use of commoditised hardware components over costly, purpose-built PBX kit, local, national and international call costs can be reduced significantly - as low as 0.001 pence per minute in some cases.

Operational benefits of hosted VoIP

Traditional telephony hasn't really evolved much in recent years and even advanced functions seem rooted in outdated foundations like touch tone dialling. VoIP on the other hand has kept pace with technology and business demands, offering these additional attractive features:

Extension mobility - take your office extension with you to any handset on the network 

Fixed Mobile convergence - no longer are your landline and your mobile two completely separate things, transfer calls between them or forward your landline to your mobile.

Call screening - get caller information and call screening on par with mobile phones.

Conference calls and coaching - Baked in conference calling is easier than ever on modern VoIP systems and it's possible to listen in, and even barge in, on sales and customer service calls.

Scalability - just like cloud computing, it's easy to scale or reconfigure VoIP systems as requirements change.

Ensuring hosted VoIP performance

Ensuring you achieve optimum performance from your hosted VoIP system while still saving money really comes down to understanding your organisation’s bandwidth requirements and making sure the required bandwidth is available. Consolidating your data connectivity on a dedicated, leased line is one strategy for ensuring you always have the bandwidth your business needs. 

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Topics: Connectivity