What is VoIP and How It Can Benefit Your Business? Introduction

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1 What is VoIP and How It Can Benefit Your Business? Introduction Although individuals are increasingly using text messaging and social media for their communication, telephony remains an essential tool for businesses of all sizes. A sophisticated telecommunication network strengthens a company s brand and their customer relations by putting a voice to their services. This notion is relevant whether the business is a start-up operated by two individuals in the same office space or is an international corporation with 2,000 staff located across the globe. Customers of any product or service still rely on the ability to reach out to a company and get another person s voice at the end of the line, especially before they make a purchase or subscribe to a service. Fortunately, creating a telecommunication system does not necessarily mean maintaining a complicated infrastructure using standard phone lines. Today, businesses are upgrading to a variety of Voice over Internet Protocol (VoIP) options to improve and unify their image. VoIP technology provides businesses with the power and flexibility necessary to achieve their goals. VoIP in a Nutshell Voice over Internet Protocol (VoIP) is a telecommunication technology developed in 1995 that relies on sending digitized voice, video and text packets over the Internet. Since then individuals and companies have gradually been changing their phone service from systems that use the traditional Public Switched Telephone Network (PSTN) to VoIP products. Businesses are increasingly attracted to VoIP systems as their networks continue to evolve and improve making them more efficient with every new advance in technology. Since the innovation of the Internet, telecommunication companies have been adapting their technology to rely on its Ethernet or wireless capabilities rather than on outdated Public Switched Telephone Network (PTSN) systems. VoIP relies on access to a high-speed broadband Internet connection to provide telecommunications services by digitizing analog communications and transferring them through wide area networks (WAN) or local area networks (LAN). The primary set-up of a VoIP system requires a phone, an Ethernet or wireless Internet connection, and a telephone adapter. Recent iterations of VoIP services

2 include Skype and Google Talk, while larger companies depend on services with wider networks that don t restrict their calls to other product users 1. Types of VoIP Systems Despite the relatively recent development of VoIP services, the technology industry has already presented businesses with a variety of options to best fit their needs. The unifying feature of these options is that they allow businesses to communicate by phone without depending solely on their phone company. Use of Phones and Computers VoIP telecommunications can occur with any combination of phones and computers, although there are different requirements for each possibility. For a phone to call another phone using a VoIP system, it must have an analog telephone adapter (ATA) to digitize the signals and bypass the PSTN. Phones with a RJ45 connector can be used to directly join the VoIP network and also easily connect to a Wi-Fi network to make calls. Computer-to-Computer calls are the most cost efficient of these options because they completely bypass a phone company. The calls, including international calls, are free since they solely use the Internet to connect. 2 Hosted v. Self-Hosted Systems Some options for VoIP systems make more sense depending on the size of your company. A larger company may want to invest in the equipment required for their VoIP system. The main piece of technology is called an Internet Protocol private branch exchange (IP PBX), which is essentially the network their phone system will rely on. The company would also typically purchase their own desktop handsets and other telecommunication tools. The other alternative for a business is to have your VoIP system hosted by the provider. This would incur a pay per user subscription plus the cost of hardware. The benefit of a hosted (or cloud based) VoIP system is that it is flexible so that small businesses can easily add lines or upgrade services as they grow. 3 1 "VoIP Definition and Solutions." CIO. Web. 25 Feb < 2 Types of VoIP Calling. Smpl Solutions, 28 Oct Web. 6 March < 3 A Guide to Business Phone Systems and Services. Business News Daily, 18 Sept Web. 6 March < business-phone-system-guide.html>.

3 Software v. Hardware Based Systems Many large offices likely use hardware based VoIP systems that use specific infrastructure for their telecommunications. Software based developments in VoIP are more recent, but increasingly popular options. Possibly the best known example is Skype. It can be accessed through an application and no additional hardware is required. It is free to use this service to call another Skype user and costs an affordable subscription fee to call landlines or mobile numbers. 4 Software based VoIP (or softphones ) do not even require a new phone line, so are viable options for small businesses or entrepreneurs. Larger businesses also might find them a convenient technology for video conferencing in addition to their hardware VoIP. Benefits of VoIP Most VoIP systems include the same telephone features as a PTSN system, but can provide them at a faster speed and a lower cost. They also leverage their use of the Internet to become more mobile and adaptable networks. The variety of VoIP systems offers a range of benefits for businesses of all sizes in any industry. Efficient Use of Bandwidth After a bit of a rocky start, VoIP systems have dramatically improved its call quality and range of functionalities and are now poised to completely eclipse PTSN based services. As faster Internet connections become available, VoIP has time and again proven to be up to the challenge of smoothly and efficiently taking over all voice, SMS and video communications for companies of all sizes. It requires a mere 10 Kbps of bandwidth, which is more than six times as fast as a PSTN connection. 5 Large companies that have transitioned to a VoIP system have seen their customer relations improve due to the increased speed at which a caller can reach a member of their staff. One business owner Emily from South Carolina, provided an online review for a leading VoIP provider, claiming We ve had increased productivity and our client feedback has been more positive 4 The Difference Between Software and Hardware VoIP. The Premier Social Entertainment Desktop Platform, 6 Dec Web. 6 March < 5 "PSTN vs. VoIP: What's Best for Your Business?" SearchUnifiedCommunications. Web. 24 Feb < Whats-best-for-your-business>.

4 across the board saying that they have to spend a lot less time on the phones waiting to get through to us because we have a better system in place. 6 Affordable Provider Services VoIP s simpler infrastructure creates a cost efficient option for businesses. They maintain lower monthly subscription costs than PSTN providers. VoIP services also have the same features as PSTN phones (including voic caller ID, and call forwarding) that are offered at a lower cost or for free. International calls are also more affordable with a small addition to the subscription cost. Companies with multiple offices are able to save money since their intra-office calls are made through a WAN, minimizing their international call expenses. Additionally, their data usage is on the same network as their voice line so they do not have separate services (and separate bills). 7 Even with frequent changes in technology, it s easy for users to upgrade their VoIP products. They simply rely on software updates to maintain current features and can add bandwidth for faster connections when needed. 8 Available for Remote Devices VoIP services are available on smartphones, personal computers, and other Internet enabled devices. Many of these options are software based, which are easy to maintain and upgrade as needed. Downloadable applications compatible with remote devices provide a consistent and reliable user experience for employees. A VoIP desktop phone and a cellular phone can also simultaneously receive calls routed from a specific phone number. 9 Businesses that encourage telecommuting or work with freelancers will find that a VoIP product can be a great asset to their team s organization and flexibility to continue work outside of the office. One user of a popular VoIP system, Henry 6 Top 10 Best VoIP Providers. Web. 25 Feb < 7 "VoIP Definition and Solutions." CIO. Web. 25 Feb < 8 "PSTN vs. VoIP: What's Best for Your Business?" SearchUnifiedCommunications. Web. 24 Feb < Whats-best-for-your-business>. 9 A Guide to Business Phone Systems and Services. Business News Daily, 18 Sept Web. 6 March < business-phone-system-guide.html>.

5 from California, stated, The benefits of moving over to VoIP have been amazing. Obviously the best ones have been massively improved communications and a large reduction in cost. The sound quality is great and I can call from anywhere. 10 Companies have also discovered other features that VoIP products offer. Rather than being tied to using the area code of the offices they mainly operate from, they can select an area code for their telephone line that makes the most sense for their customer base. 11 Since this technology can be applied to desktop or mobile phones, it supports a business s goal to be available and conveniently reached by their target customers. Simple Integration with Other Technology A VoIP system can be fully integrated with an existing landline system so that your business can achieve a more holistic and professional communications presence 12. Interactive Voice Response (IVR) features were once generally only practical for large networks, but are now attainable for small businesses through VoIP. It allows callers to interact through a menu of options, including a staff directory, so that their call quickly reaches the staff member who can best address their need or question. This presence is further strengthened by a VoIP system s ability to fully integrate into a business s computer system. Voic s can be easily transferred by to be recorded or listened to at a later time. VoIP also provides fax, video and SMS services. Just imagine having the capability of smoothly and simply sharing a sales presentation with a potential client or sending important data to colleagues. Streamlining the use of these essential communication tools can greatly improve the efficiency of a company, especially if they are widespread internationally. Tom Hughes, vice president of small business marketing for AT&T, stated that VoIP services provide important changes to improve [a company s] productivity and drive additional business Top 10 Best VoIP Providers. Web. 25 Feb < 11 PC Magazine. Web. 24 Feb < 12 PC Magazine. Web. 24 Feb < 13 A Guide to Business Phone Systems and Services. Business News Daily, 18 Sept Web. 6 March < business-phone-system-guide.html>.

6 A key aspect of monitoring productivity relies on the ability of VoIP networks to record and analyze the use of its system. This is especially critical for businesses that rely heavily on customer service departments. Data stating when their staff talked to a client and for how long is important when evaluating the company s efficiency. Conclusion The wide variety of VoIP technology options and providers virtually guarantees that a business can find the right fit for their internal and external communications. VoIP products are able to evolve and operate productively to meet the needs of a modern company of any size. Small to mid-sized businesses can feel confident that their VoIP network can grow with them while still providing them with diverse and essential communication tools. Larger and geographically widespread corporations can be assured that they are using the most cost efficient and powerful option available to improve their productivity. More businesses are making the switch to VoIP networks due to their flexibility to adapt to future technologies. Traditional landlines don t benefit from the frequent advances in communication software, mobile devices, and high speed Internet as easily as VoIP systems. The efficacy VoIP products have greatly improved in their first twenty years and will continue to be enhanced with the newest telecommunication technologies. Have you explored what VoIP can do for your business yet?

7 WORKS CITED Top 10 Best VoIP Providers. Web. 25 Feb < PC Magazine. Web. 24 Feb < "VoIP Definition and Solutions." CIO. Web. 25 Feb < "PSTN vs. VoIP: What's Best for Your Business?" SearchUnifiedCommunications. Web. 24 Feb < Whats-best-for-your-business>. "The End of the Wired Telephone Network Is Coming...But Not Soon Enough." Forbes. Forbes Magazine, 30 Oct Web. 24 Feb < "Voice Over Internet Protocol (VoIP)." Voice Over Internet Protocol (VoIP). Web. 25 Feb < "Telegram for the FCC: Time to Retire the Telephone Network." Forbes. Forbes Magazine, 18 Sept Web. 27 Feb < Types of VoIP Calling. Smpl Solutions, 28 Oct Web. 6 March < A Guide to Business Phone Systems and Services. Business News Daily. Business News Daily, 18 Sept Web. 6 March < The Difference Between Software and Hardware VoIP. The Premier Social Entertainment Desktop Platform, 6 Dec Web. 6 March <

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