Advantages of VoIP for Business (and the Disadvantages)

VoIP can reduce costs for business telephone service while delivering a bunch of great features that aren’t possible with regular phone service. From mobility to video conferencing, a there are many advantages of VoIP for business use. There are, however, some disadvantages as well.

Here are the top advantages and disadvantages of VoIP for business.

What Is VoIP?

Voice over Internet Protocol (VoIP) is a packet switching telephone network that uses the internet to make and receive phone calls.

It is different from regular circuit switching systems because it opens a brief connection in order to send a small “packet” of data from one system to another instead of keeping the connection open and constant.

This type of technology is nothing new; the first VoIP call was made in 1974. Like most technology that was around in the 70’s, VoIP has evolved and improved its features so as to remain useful in technology driven world. With the advent of high speed, broadband internet, VoIP is a common (and maybe even default) choice for business voice communications.

Why VoIP for Business

The analog voice calls are converted into packets of data, which travel over the public internet or a private IP network. A private IP network is chosen over public internet connections when stronger security is needed or wanted. This technology can be used to make or receive calls via landlines, cell phones, or from computer to computer.

For businesses purposes, a VoIP provider provides fully-fledged VoIP systems that, unlike Skype, do not rely solely on a computer or mobile interface, supporting desk phones and enterprise applications.

VoIP can help a business’ bottom-line, mobility, and productivity. Instead of a company having to manage two networks (one phone network and one internet network), they can streamline and save money by only having one. This allows them to easily add, move or change phone extensions and locations. VoIP is also very mobile. Many hosted VoIP providers offer mobile apps that let you use your data connection to make and receive calls at home or on the road.

Unlike most business phone systems, with VoIP you are using specialized software to place calls. This means you can leverage your internet connection to place phone calls for free by bypassing mobile or land phone companies.

There are three different methods you can use to place a VoIP call.

IP Phones

These looks just like normal landline phones, but instead of a phone jack they have an RJ-45 Ethernet connector that connects to your router. Their onboard software and hardware have everything you need to make your IP call.

Specialized Wi-Fi phones allow callers to place a Voice Over IP call from any place that provides a Wi-Fi hot spot.

Analog Telephone Adaptor (ATA)

This is perhaps the most common way to place a VoIP call.

The adaptor lets you connect a standard landline telephone to your internet connection or computer to convert the analog phone signal to a digital one.

Computer to Computer

For this type of call, all you need is a sound card, microphone, and speakers that come with any computer; an internet connection; and (often free) special software.

Using any of these methods will allow you to place phone calls for free over an Ethernet or Wi-Fi internet connection, depending on your choice of method.

Comparison To PSTN

There are many benefits of VoIP over a Public Switched Telephone Network (PSTN), also known as the plain old telephone service.

First, the price is more budget friendly because there is less hardware to buy or lease, monthly subscription fees are lower, most are contract free meaning no termination fees, and many VoIP providers let you make calls to coworkers, even if they are long distance, for free.

With VoIP you can reduce your company’s travel and training costs through web and video conferencing tools, while maintaining an easily accessible and scalable phone system. A scalable phone system allows for the easy addition of new extensions into the network without the need for expensive hardware.

VoIP also allows for more than two people to be on a line at a single time, helping keep employees and customers connected. Another great feature for businesses is the ability to have one phone number ring multiple devices, so even when you are away from your desk, you will never miss a call.

VoIP	PSTN
One internet connection	Dedicated lines
Call waiting, Caller ID, etc.  included for free	Call waiting, Caller ID, etc. available at extra  cost
Long distance included in regular  monthly price	Long distance is charges per minute or by a  subscription
No power backup	Hardwired landline phones can remain active  during power outages
911 cannot trace location	911 can trace location

Advantages of VoIP for Business

Productivity

VoIP technology is a great way to increase productivity of an organization by providing a way for their employees to multitask uninterrupted. VoIP allows users to hold meetings and share information using video conferencing.

You can set up individual users, manage features and call routing and customize your entire system through a simple web interface, removing the need for internal IT support. The system can be used over Ethernet or Wi-Fi, allowing your infrastructure to stay intact.

Cost

Businesses can see somewhere between 30% and 50% savings after they’ve switched to a VoIP telecommunications system. While this varies from company to company, most see a marked drop in phone expenses when the switch business phone systems from traditional to VoIP.

Depending on which provider you choose, you may even be able to make international phone calls using local rates. Some providers even have mobile apps that make it easy for employees to take advantage of VoIP on their business mobile phones, further reducing operational costs.

VoIP also eliminates the cost of hardware and maintenance of phone systems for additional savings.

Flexibility and Mobility

With VoIP, it’s easy to add users, extra lines, and features through a web browser to remove the need for on-site technical assistance. Because most modifications are done online, companies can save money on service fees.

VoIP scales along with your company, and changes can be made easily and immediately. Some providers even offer ready-to-use VoIP phones, further reducing the need for dedicated phone management personnel. It also allows the user to integrate software programs, such as email, fax, and remote conferencing. A VoIP user can speak to somebody over the phone while still using the internet or other applications at the same time. VoIP users can talk on the phone anywhere where there is an Internet connection. This increase in mobility is ideal for anyone who travels or needs to work from multiple locations.

Disadvantages of VoIP

The main disadvantage – What Happens if the Internet Goes Down?

This is one of the main disadvantages of VoIP for business. If the internet goes down, your internet-based phone system does too.

However, there are some solutions or ways to tackle this type of situation. You can have incoming calls automatically bumped to voicemail, or you can have your calls rerouted to your mobile phone. Either way you will still be receiving your messages, which will allow you to continue working.

Some VoIP providers also allow connections through 3G or 4G, keeping phones alive through cellular data networks. With a 4G backup connection, employees can connect even if the ‘net goes down, or from anywhere, even without a WiFi or hard-wire network connection.

Decision Time

The new functionality that VoIP offers and its ever-evolving nature, makes it a great choice for businesses. With all of the different advantages of VoIP for business, it’s clear that companies looking to keep up in this day and age should consider going with VoIP.

How much more can the plain old telephone system actually change and improve? VoIP harnesses the latest technologies to provide better quality and more security.

VoIP subscriptions are growing and PSTNs are declining every year, soon there may no longer be a choice in the matter. Maybe it is time to throw out the old system and get with a new one.