HOSTED (VoIP) PHONE SYSTEMS DECODED FOR THE SMALL BUSINESS MARKET

VoIP, Hosted Phone System, Unified Communications, IP Telephony? It goes by any number of names, but what is it really, and how well suited is it for the needs of the average small to midsized business? Let's unpack it and take a look.

VoIP, or Voice Over Internet Protocol is a pretty simple concept. Instead of routing incoming and outgoing calls over analog "land lines", the calls are transported over your business's internet connection. It happens as your voice conversations are sliced into "packets" that are transmitted through "gateway protocols" that reconstruct them on the receiving end. To the end user, there's virtually no difference between a VoIP telephone call, or a call made with more traditional technologies.

VoIP has been widely adopted in the business universe for more than a decade. Starting with large government, education and commerce companies, like most technologies, it has steadily moved downstream to the small business marketplace. The pace of adoption has grown steadily to the point where there is almost no reason why a business would choose a traditional key system or PBX over a VoIP system.

Let's look at the advantages and disadvantages of VoIP phone systems. Like anything else, no solution is perfect and with every technology choice there is a spectrum of both positive and potentially negative features.

HOSTED (VoIP) PHONE SYSTEMS DECODED FOR THE SMALL BUSINESS MARKET
January 6, 2016
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Craig J. Stapel, CEO Insight Direct Networks Hillsborough, NC

VoIP, Hosted Phone System, Unified Communications, IP Telephony? It goes by any number of names, but what is it really, and how well suited is it for the needs of the average small to midsized business? Let's unpack it and take a look.

VoIP, or Voice Over Internet Protocol is a pretty simple concept. Instead of routing incoming and outgoing calls over analog "land lines", the calls are transported over your business's internet connection. It happens as your voice conversations are sliced into "packets" that are transmitted through "gateway protocols" that reconstruct them on the receiving end. To the end user, there's virtually no difference between a VoIP telephone call, or a call made with more traditional technologies.

VoIP has been widely adopted in the business universe for more than a decade. Starting with large government, education and commerce companies, like most technologies, it has steadily moved downstream to the small business marketplace. The pace of adoption has grown steadily to the point where there is almost no reason why a business would choose a traditional key system or PBX over a VoIP system.

Let's look at the advantages and disadvantages of VoIP phone systems. Like anything else, no solution is perfect and with every technology choice there is a spectrum of both positive and potentially negative features.

THE BENEFITS:

BIG BUSINESS FEATURES

Technology has often served to level the playing field for small businesses. It's especially true for VoIP technology. Almost every provider will include for free features that used to be the special domain of companies spending tens of thousands of dollars on hardware. Some of the common features you should look for include:

Auto Attendant (thanks for calling XYZ Company. For sales. press 1, for service, press 2, for parts press 3. For a spell by name directory, press the * button) Most companies regard incoming calls as sales opportunities, so it's common to set up a "day treatment" where calls are routed to live employees during normal business hours, and only go to the auto attendant after 4 rings. You'd then set a different night treatment, where calls are routed immediately to the auto attendant. This is all customized according to your hours of operations, providing for emergency or vacation special instructions.

Music On Hold. It's been around for years, but remains a nice feature that allows your callers to know that their still connected. You can also customize a special marketing message, combined with music that is tailored to your business.

Find Me - Follow Me. This is probably the most useful feature for entrepreneurs and business owners. With this enabled, calls will follow you across whatever device or location you happen to be using. Your Smartphone becomes a phone on your system. For instance, a call is routed to your desk, but you're not there. It's then routed to your Smartphone, where an app launches showing the calling parties caller ID. When you answer on your Smartphone, you can now transfer the call to any other phone in the system. If you don't answer it, the caller is routed to your system voice mail, where they leave a message. The voicemail is now sent to your email (which you receive on your Smartphone) so you never miss a call. Bonus feature: When making a call from the Smartphone app, it will show your Business Caller ID information, NOT your cell phone number.

Call Continuity Service. With a VoIP system, the system is smart enough to detect a loss in internet or power. You predefine up front where you want your calls to be routed in the event of an emergency so that you never miss your calls.
Voice Mail - Email for Every User. Each seat in your system has its own voicemail that can be customized. You can set up your system to forward any voicemails to an email address(s) so that you can retrieve them easily no matter where you are. (like your Smartphone)
Call Queue Service. This call center application can easily and inexpensively allow you to manage your inbound calls. "Thank you for calling XYZ Corporation. We're all helping other customers, but your call's important to us. Please hold on for the next available agent". The system will then hold calls in queue, releasing them to an available agent as soon as the complete their last call.

HOSTED SECURITY: Because the system is hosted by the provider you chose it is infinitely more secure than any premise based system. It will reside in a secure data center with military grade encryption. There will be geographic redundancy of servers with automatic failover should any point go down.

With a premised based system that requires an outlay of capital upfront, you are purchasing the technology at a given point in time. With a hosted system, the technology is constantly advancing, and those changes acrue to your system, usually without additional costs.

MULTI LOCATION ADVANTAGES: For companies with multiple locations a VoIP phone system has the potential to transform your business in some positive ways. Because the system is housed in a remote data center, multi-location companies can now operate under one unified system. It doesn't matter where your locations are, they can all be integrated. For example, we have a client that has 7 locations, one of which is in China. The owner used prepaid calling cards to call the China location to mitigate the costs. Not only were these cumbersome, but they needed to be refilled when they ran out of minutes. With our hosted solution, we were able to ship phones to the China location, and now China is part of the same phone system in the US. The owner now just dials a local 3 digit extension to reach his Chinese associates. Some examples of how this could benefit your business:

Location redundancy: Route calls to another location should one location loose service.
Busy Call Routing - Mitigate staffing problems: Let's say that one of your locations is busy. All of the parties are on the phone. The next caller will be routed to another location that isn't busy.

Time of Day Routing - If you have locations across multiple time zones, calls can be routed according to time of day, according to your staffing.

Severe weather - Let's say Raleigh is expected to have an ice storm. You've got a couple of ways to handle calls; you could send your calls to Florida for the duration, or you could simply have key employees take the phone off their desks and plug it into their home Internet and business would continue without loosing a beat.

THE POTENTIAL DISADVANTAGES: There are some considerations that you need to think through before you decide to make the move to a hosted telephone platform. Here's some of the most common:

INTERNET QUALITY: Before you move to a hosted phone system you need to consider the quality, speed and latency of your Internet connection. Because your phone calls use your Internet connection it needs to be properly vetted to ensure a successful experience. Here's some of the things to consider:

SPEED: The average bandwidth requred for a VoIP call is roughly 80-100 Kbps (kilobits per second). This mean that if you have 10 simultaneous calls, you would be consuming 100 X 10, or 1,000 Kbps (1 Mbps) (megabits per second) of both upload and download speed. Check your speed at www.speedtest.net

COMPETITION FOR BANDWIDTH: Some companies have enough speed (bandwidth), but their traffic is "bursty". This means that when you do use the Internet, you use lots of it for short periods of time. An example would be a real estate agent, who is uploading pictures of properties. Say she's uploading 30 pictures, and 5 people make a call, the quality of the calls would be subject to having problems because the upload speeds are consumed with sending the pictures. Try the same phone calls once the pictures are uploaded, and the quality would be fine.

LATENCY: You may find that you have good speeds (bandwidth) but that you have a latency problem. Latency is an indication of how long it takes to make a connection to a distant server. If the upload and download speeds are mis-matched, it can cause quality problems. This is measured in MS (miliseconds). Generally anything less than 80 MS is sufficient for VoIP quality. Check your latency at http://pingtest.net.

JITTER: is a measurement of the consistency of the circuit. It's also measured in MS (miliseconds) and generally jitter less than 50 MS is sufficient for VoIP quality. Check it also at http://pingtest.net.

All of these things can generally be sorted out and managed with the help of your IT professional or your solution provider. For instance, your router could implement a QoS protocol (quality of service) that will carve out bandwidth just for your phone calls. If you're internet is sobject to outages, your VoIP provider should be able to implement "continuity service" to route your calls to another phone during outages. You could also invest in a truly redundant Internet network with 2 providers, using a dual WAN router with automatic failover. In this case, your router would sense that the internet was down and automatically "fail over" to the other internet provider.
Work with your IT professional or Solution provider to understand these topics prior to setting up your VoIP system.

OPERATIONAL DIFFERENCES One of the adjustments that you need to be aware of is that a VoIP system operates differently than a traditional key system. Here's how:

• Line Appearances: With a older key system, if you had 3 lines, you'd be able to place a call on hold, go to another phone and just hit the line appearance to pick up the call. Not so with VoIP. In this case, you'd "park" the call in "orbit", then dial a code to retrieve that call from a different phone. Not a big deal, just different and it takes some getting used to.
• Transferring calls: Each incoming call is answered by someone, t hen transfered to the correct extension. Again, this is different than most systems, where you'd put the caller on hold and pick it up from a different extension by hitting the line appearance. Complexity "More Buttons to Press" This is a common thing we hear once customers make the move to a VoIP system. It's true that with more operational possibilities and features, there's more complexities with using the system.

Experience has shown us that these issues can be overcome with solid training and experience, but none the less should be considered before making any changes. Be sure that your solution provider has a plan in place to help you with the transition.

SUMMARY VoIP as a technology has become an undeniable marketshare champion. It has grown from 20 Million US subsribers to over 70 Million in 2015. Where large enterprise business and residential markets were the early adaptors, small business adaption is expected to triple in the last half of this decade as business replace their aging premise based systems. Chances are your business will be considering this technology in the next 12 months. This blog post is a simple overview for small business owners, and it tries to outline both the upside and downside accurately.

Please see some of our other postings for more information about this and other technology topics