VoIP Buyer s Guide. technologyadvice

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2 Table of Contents Executive Summary.. 3 The Mysterious World of VoIP. 4-5 Why Implement VoIP 6-7 Feature Analysis 8-10 Pricing Choosing a Vendor Comparative Analysis The Next Step

3 Executive Summary Communication is essential to any successful business operation, so when a workplace is lacking a core network foundation, productivity is minimized. The best way to provide productive communication for your business is to purchase a VoIP (Voice over Internet Protocol) phone system in your office. The technology in VoIP exceeds that of a landline phone system and provides many additional benefits. Since 2007 the VoIP industry has experienced an annual growth of 16.7% and exceeded $15 billion in revenue, so it s evident this is more than just a trend, it s a revolution in the communication realm. In fact, IBIS World shows that the number of VoIP customers is predicted to increase from the 47 million in 2010 to almost 410 million by However, with a flood of competitors around 860 different providersand many factors influencing a purchase, making a decision on a VoIP phone system can prove to be extremely difficult. Don t let the stress of making an impactful purchase like VoIP keep you from reaping the plentiful benefits it could provide for your business. This buyer s guide to VoIP phone systems will provide insight to assist you in making a purchase by providing the knowledge necessary for such an important decision. You will learn more about what exactly VoIP is, why you need it in your business, the factors involved in a purchase, and a comparison between the top 10 vendors in the VoIP market. 3

4 Introduction For those new to VoIP, the concept and terminology can be difficult to understand and overwhelming. For some, it s enough to turn them away from making a decision that can greatly improve their business operations. Let s simplify it. What is VoIP? VoIP stands for Voice over Internet Protocol, which is just a fancy way of saying a phone service through means of the Internet. No longer are the days where you have to provide landlines for every phone in your office. Most offices now have a broadband connection to the Internet and you can use that as a basis to connect your phone system to. The reason for its rise in popularity is that the technology brings many benefits over traditional phone service. For instance, less difficulty and wiring required to set up phones throughout the office since you will be capitalizing on your Internet connection instead of landlines. With additional features over traditional phone services, VoIP boosts productivity in the workplace which always is a plus. Lastly, services tend to be less costly and so you come out ahead by having a better service for less of an expense. How it Works As previously mentioned, VoIP uses your office s broadband Internet connection as a way to provide phone service. A VoIP phone transmits the call in a digital way, by transmitting your voice into packets of digital information that is sent through the Internet as you speak. The receiver doesn t have to possess a VoIP system to receive the information packets properly and most likely, wouldn t even be able to tell the difference between your call and one from a traditional phone service. With this technology comes cost savings and additional features of voic , caller ID, and call forwarding that are considerably cheaper than what a traditional service could offer. However, it is important to note that VoIP can only work successfully through a broadband Internet connection. If you don t have one or currently have unreliable service, it may be necessary to consider switching Internet providers or upgrading your current connection to better your VoIP phone system. 4

5 Terminology Before you can fully understand VoIP, you must also learn the terms associated with the concept. Here is a list of VoIP terminology that will be useful to understand for your buying decision: VoIP: Voice over Internet Protocol. A technology or set of standards for delivery of telephone calls and other voice communications over the Internet, involving conversion of analog voice signals to digital form. Analog: Refers to the traditional phone system that uses landlines and older technology. Broadband: pertaining to or denoting a type of high-speed data transmission in which the bandwidth is shared by more than one simultaneous signal. The connection used for VoIP phone systems. PBX: a manually or automatically operated telephone facility that handles communications within an office, office building, or organization and that is connected to the public telephone network. TDM: Time-division multiplexing, where two or more bit streams or signals of information are transmitted over the same link by allocating a different time interval for the transmission of each channel. IP: Internet protocol, the method by which information is sent between any two computers on the Internet Open Source Software (OSS): Computer software with its source code made available and licensed with an opensource license in which the copyright holder provides the rights to study, change and distribute the software for free to anyone and for any purpose. Unified Communications: the integration of real-time communication services such as instant messaging, presence information, telephony, video conferencing, data sharing, call control, and speech recognition with non-realtime communication services such as unified messaging (integrated voic , , SMS and fax). Quick Tip: Determine the needed scalability of your VoIP by the number of employees and offices using the system. 5

6 Why Implement VoIP ROI Choosing to implement VoIP will require considerable time and effort to employ. Many businessmen use the excuse that they are swamped and too busy to even consider making such a drastic change in their current communication network. However, what they fail to realize that the time it takes for initial setup will be well worth the time and cost savings they will incur after the system is in use. Not only will VoIP stimulate productivity in the office but you will also see a quick ROI. Efficiencies Also, when implementing VoIP you essentially converge your phone and internet networks into one. The phone system will be setup through your broadband Internet connection and with the two being combined, reduce the additional maintenance and support costs that having them separate incurs. However, it does increase the pressure to maintain a stable Internet connection at all times because then you will lose access to your Internet and phones simultaneously. Most business Internet providers maintain relatively stable connections since they understand the importance of it to conduct business. If you feel like your current Internet provider can t handle the demand for your business Internet needs, you may need to consider switching to a more reliable provider to ensure optimal service. Features Lastly, you may look to VoIP as a way to create more features than your current phone system. Most services have an option that automatically forwards voic s from your office phone to your business . This feature wouldn t be available on an analog phone system and can provide a new way for easy transcription of voic by allowing users to access their messages via rather than phone. VoIP phones also have the ability to connect to your mobile phone. Therefore it is important that you determine what features are necessary for productivity in your office and find the VoIP service that best provides them. 6

7 5 Reasons to Get VoIP 1) Cost Savings Anywhere you can cut expenses but still receive a high quality service is a benefit for your business. By using the Internet, you don t need to pay the costs of landline service or the extra fees that are associated with it. 2) Increase in Productivity Communication is essential to business interaction and having a way to simplify a receptionist s job by automated services can free that person up to do more functions within your business. 3) Professional Feel For small businesses, it is hard to reflect a professional feel with their phone service, especially if they aren t able to answer calls 24/7. With custom greetings and call routing, you can sound like a big business for little cost. 4) Additional Features Your basic phone service doesn t possess many features and if they do, you are most likely being charged extra for them. Most VoIP services come with a wide array of features including the standard boic and Caller ID and more advanced options like automated greetings and call routing, that are usually included within the price of the service. 5) International Calling Conducting business abroad opens up lots of opportunities for businesses but phone calls can be costly. Since VoIP uses the Internet for international calling, costs are a lot lower than a basic phone service with no long distance fees or charges. Quick Tip: Make a list of the features you feel are essential for your particular operation to establish your must-haves. 7

8 Feature Analysis Learn the unique possibilities that the features of VoIP can add to your own communication network and their potential impact upon your business. 8

9 Feature Analysis Now that you notice the benefit of what a VoIP phone system can bring to your business, it s important to determine what features are desired in order to choose the best vendor. First, you need to know the wide range of features available with VoIP. Then, learn the unique possibilities that the features of VoIP can add to your own communication network and their potential impact upon your business. Then, you need to make a list of the ones you feel are essential for your particular operation to establish your must-haves. With this information in hand, you can then begin to compare what each vendor has to offer feature wise to find the best fit for you. Auto Attendant Is your receptionist constantly inundated with transferring phone calls to the appropriate extension? This feature allows you to bypass the use of a receptionist by providing a voice menu that automatically transfers calls to the appropriate extension. Call Management Features Includes common features like call forwarding, hold, speed dial, and transferring functions that add to the capabilities of your phone system. Voic Manages missed phone messages, can also have the feature of sending voic messages to your business account for easy transcription. Intercom Stimulates employee communication by allowing you to place calls internally. Conference Calls Allow multiple telephone users to sit in on a telephone call. Great for business interactions or meetings that require multiple parties present. 9

10 Security Whenever transmitting sensitive business information, it is important to install security features like firewall or device authentication. Prevents unauthorized access to your phone system and secures your data. Monitoring With Caller ID you are able to see who is calling you before picking up the phone. With the addition of Call Screening tools, you can block or reroute calls to voic . Multisite Management What if you have multiple office locations? With Multisite Management you can keep a unified phone system between various locations, simplifying your communication network. Advanced Features These unique features includes call hunt, flip, and night answers which provides more ways to manage inbound and outbound calls. Contact Center To further automate the handling of incoming calls these features include queuing, call distribution, and phone support. Although they come at an extra cost, they could relieve some work off the receptionist and ensure that calls are properly distributed. Quick Tip: When defining the features you want, ensure there is compatibility between the new system and your existing infrastructure. 10

11 Pricing Options Not every provider prices their services the same way and you may be surprised with hidden fees on your bills. Here is a breakdown of the different costs associated with VoIP. 11

12 Pricing As with any business decision, it is important to determine how a new product investment will affect the bottom line. Every expense needs to be accounted for and provide value to business operations. The major benefit of VoIP is improvement with your communication network which is central to any business. However, not every provider prices their services the same way and you may be surprised with hidden fees on your bills. Here is a breakdown of the different costs associated with VoIP: Initial Costs This will be the largest financial burden your VoIP system should bring you and includes the price of hardware and installation. The overall costs of setup can range from hundreds to thousands of dollars depending on factors like: Company Size - If you are a small business the initial setup costs would be less than a large enterprise due to the scope of the setup. Pre-existing Configuration - Your initial cost may be lower if they can salvage or build from your pre-existing network. However, if your office is unequipped with the proper cabling or configuration, you will have drastically higher setup time and costs. New Office - If you just recently built your office, you can decrease the cabling costs by choosing a VoIP system since then you wouldn t have to run a separate cable for your phone network. Hardware - If you already have hardware that could be incorporated into the new VoIP system like phones or adapters, you can decrease the initial setup costs. However, if you are starting with a clean slate, the price of hardware is a large investment. Software - Some VoIP providers require software to use their service. Unless you have one designed specifically for your business, this cost is usually very low - if not free. 12

13 International Calls If your business performs a lot of international calls, a VoIP system will save on your monthly calling expenses. Since VoIP makes calls via an Internet connection, which doesn t distinguish borders or recognize the distance between callers, most providers do not charge exorbitant long distance fees like a basic phone service would. Subscription Just like most communications, you will be billed on a monthly basis for your VoIP phone system. Every provider will have different monthly fees based on the services they provide. Also, your monthly bill will increase with any extra features you choose to add on to your VoIP system. Service/Maintenance Costs Technology is susceptible to malfunctions and even the slightest of errors could greatly affect your business daily operations. A system downtime of a few hours could interrupt vital communications and reflect badly upon your business, especially if in that timespan customers are unable to get a hold of you, leaving them dissatisfied with your service. To prevent this from occurring, you will need to ensure proper routine maintenance is being performed. The servicing would incur additional costs, unless provided in your service plan. Also, you never know when hardware may malfunction and needs to be replaced, so that could be a possibility for unforeseen costs. Staffing Costs Most likely VoIP will reduce your on-site IT staffing costs since the provider usually handles maintenance and servicing costs. It is imperative you check the service contract to be aware of what maintenance/servicing costs are included in the subscription price to avoid any hidden fees. However, if you choose an On-Premise option you would then incur the full upkeep costs and need to staff accordingly. Remember that VoIP will handle many responsibilities that a receptionist normally would through automated greetings and call routing features, so it will reduce your call handling staffing costs and allow you to use that person in other facets of your business. Quick Tip: During your research, comprehend what the service contract entails and the terms of the service. 13

14 Choosing a Vendor Not every provider prices their services the same way and you may be surprised with hidden fees on your bills. Here is a breakdown of the different costs associated with VoIP. 14

15 Choosing a Vendor As with any business deal, it is important to research all the vendor options and the benefits each bring to the table. Lack of knowledge about a potential vendor could put your business on the losing end of the deal, leaving you with an unpleasant experience that could prevent your business from achieving maximum use of your VoIP phone system s capabilities. Level of Control Even if you are a first time VoIP buyer, you can determine the level of control your business has over the phone system. There are three different implementation structures you can choose from: On Premise, Hosted, or Managed. On Premise If you are wary of relinquishing any control over to a vendor; this is the option for you. Essentially, you buy your own VoIP hardware and manage the system all inhouse. This retains direct control within the company but will require you to hire an on-site staff to maintain and operate the phone system. This incurs a lot of up-front investments with hardware and long-term investments for staffing requirements. Hosted This solution is the best of both worlds. Here, the buyer owns the system but hands over the managing of the service to the provider. Although you make a higher initial investment in the equipment, you don t have to worry about the long-term costs of in-house staffing to support the system. You also lessen your monthly subscriber costs. Managed On the opposite end of the spectrum, a managed solution gives complete control over the vendor where they own and manage the system entirely. This prevents you from bearing the full weight of initial hardware investment but you will be paying more for the service itself to be managed. 15

16 System Types Besides the features and the level of control, there are different VoIP products and solutions to choose from. TDM-based PBX: This is the traditional format that uses TDM technology within your phone system. TDM-based PBX requires cabling so it is great for facilities that already have cabling installed and don t want to take the time or money to change it or setup newer options. Luckily, TDM still provides options of Unified Communications so you can still have a relevant technology even though it is run through and older system. IP PBX: This system types sways from the traditional phone system and puts the infrastructure with the Internet Provider. Essentially, this is your VoIP system which uses broadband Internet technology as your telephony infrastructure. The initial setup may be costly but long-term, this option will reduce maintenance costs, calling bills, provide for more customization, and greater scalability than traditional TDM systems. Hybrids: To get the best of both worlds, choose a hybrid system that combines multiple features into one platform. Open Source Software- This alternative requires that the buyer only pays for the hardware for the phone system. Then, they download the open source software solution through a required code online which limits major investments and provides for more flexibility. Unified Communications- UC is the integration of voice, video, , and other communication systems into one platform. This simplifies communication processes which increases employee productivity and efficiency. VoIP is easily upgraded to UC since it already possesses a lot of the functions, but its still possible to upgrade a TDM-based phone system as well to UC. Managed IP PBX services make up the largest slice of worldwide business VoIP services revenue pie 2010 Hosted VoIP and UC IP Connectivity Managed IP PBX 2015 Hosted VoIP and UC IP Connectivity Managed IP PBX Infonetics Research, VoIP and UC Services and Subscribers with Service Provider Scorecard: Biannual Market Size, Share, and Forecasts, March

17 Support Services When entering into a contract with a VoIP provider, it is important to note the services to be rendered post sale. With any technology, there becomes great chance of errors occurring or system malfunctions which may be too much for you or your IT team to fix. Here is what you should look for in a provider s support services: Customer Service Team: To find solutions and resolve problems in a timely manner. Testimonials/Reviews: See what other customers have to say about the service. Expertise: Validate their VoIP knowledge by years in the field and certifications. Up-to-date: Technology is an evolving world so it is important your provider is current with what is trending in order to ensure you are receiving the highest quality service. Maintenance/Upkeep Policies: Routine maintenance keeps your system running smoothly so note how often they perform it and if there are any additional costs. Insurance: Replacing defective hardware is expensive and any major system downtime can be detrimental to your business, so inquire if they offer any insurance policies. Quick Tip: Make sure to guarantee your Internet connection can handle the presence of VoIP. Quick Tip: Consult reviews and testimonials from previous and present customers. Quick Tip: When choosing a new vendor, research your vendor s history to determine reliability. 17

18 Comparative Analysis Now that you know what to look in vendor, here is a comparison between the top VoIP service providers. 18

19 Nextiva Vocalocity RingCentral Phone.com Features Auto Attendant X X X X X X X X X X X X X Call Blocking X X X X X X X X X X X X X Call Forwarding X X X X X X X X X X X X X Call Hunt and Return X X X X X X X X X X X Call Recording X X X X X X X X X X X X Call Screening X X X X X X X X X X X X X Click-to-Call X X X X X X X X X X X X Conference Calling X X X X X X X X X X X X X Dial-by-Name-Directory X X X X X X X X X X X X X Direct Dialing X X X X X X X X X X X X X Internet Fax X X X X X X X X X X X X X Unlimited Calling X X X X X X X X X X X Web Conferencing X X X X X X X X Call Center Call Queue Managment X X X X X X X X X X X X Call Monitoring X X X X X X X X X X X X X Call Routing X X X X X X X X X X X X X Downloadable Call Recording X X X X X X X X X X X On-Hold Music X X X X X X X X X X X X X Simultaneous Ringing X X X X X X X X X X X Integration Outlook Integration X X X X X X X X X Salesforce Integration X X X X X Mobile Integration X X X X X X X X X X X X X BYOD Compatible X X X X X X X X X X X X X Voic Voic Transcription X X X X X X X X X X X X X Voic to X X X X X X X X X X X X X 8x8 VirtualPBX Via:talk Shoretel Phone Power Fonality Apptix Evoice Jive

20 The Next Step You must figure out what derives the most value for your business. Once you find the right fit for you, then you begin the implementation process. 20

21 The Next Step Although this buyer s guide reveals some of the top VoIP providers in the industry, there are still many more to choose from so it is crucial you determine what is most important for you to receive from your service. Whether it is an arsenal of features at your disposal or a great customer service staff to help resolve problems, you must figure out what derives the most value for your business. Once you find the right fit for you, then you begin the implementation process which involves entering into a service contract with the provider, installation, and educating employees on how to operate the new system. Service Contract For most of the providers mentioned, the service contracts aren t very negotiable. However, the larger your account is, the more room you will have to ask for the things you require in your contract. Review your contract closely to avoid any hidden charges or stipulations that could affect your agreement. Also, your service contract should be tailored around you and be sure to mention any additional features you would like to receive and that they are accounted for within your contract. Lastly, be aware of what would occur if you need to end service abruptly like possible cancellation fees. Installation As you begin installing your new VoIP system, you will need to be aware of your previous infrastructure and its compatibility to your new service. Most of the providers mentioned in this buyer s guide promise ease of installation but it is still important to ensure that your phones and internet connection is up to par for the new VoIP service. Most companies provide a free systems test to see if your current connection will handle their requirements. Also, note that it will take time to receive any ordered phones or download required software so don t necessarily expect instant access. 21

22 Educating Employees The reason behind purchasing a VoIP phone system is to increase productivity by an efficient means to communication. Yet, you will be defeating its purpose if you fail to teach your employees how to maximize the use of the new VoIP system. There are different ways to educate your employees on the new system and all depends on the amount of time you have to do so. If you are running short on time, send a link to a video tutorial provided by the chosen vendor or detailed instructions on how to use the new system. However, that doesn t necessarily ensure that your employees will follow through with the instructions so it might be worth it to just take some time out of your day to discuss how to operate the new system with employees face-to-face. Perhaps contact the vendor to see if they can send a trainer to educate your employees or if they have any training materials available for you to use. Regardless of your methods, the employees must know how to operate the system in order to get maximum return from your investment. For more information on VoIP providers, check out our VoIP Product Selection tool to compare over 50 VoIP providers at: 22