Don’t buy a new business phone system without VOIP capability

One of the most honest and sincere pieces of advice a telecom professional can give a business when it comes to evaluating phone system technology options for their business is to make sure they buy a phone system with VOIP capability. It is estimated that over 90% of new business phone systems shipping in 2010 will be VOIP-enabled and we will assess the reasons for this trend and explain why owning a phone system with VOIP-enabled has become a necessity, even if you don’t use the features at the time of purchase.

It is best to start with a brief description of the different types of VOIP systems available. Not all flavors are created equal and each has its own benefits. VOIP means many things to many people. So let’s make sure we speak the same language before we start. There are two main areas of VOIP that need to be covered:

VOIP phone service: Defined as the ability of your phone system to connect to a phone service provider over your data connection to place your calls over the public Internet. SIP trunking is the most popular commercial-level interface method, but we will not cover this transport method in this article. VOIP phone service promises slightly more competitive pricing, largely due to increased T1 usage due to compression, but few phone systems currently interface with VOIP providers. Each manufacturer must go through a rigorous interoperability testing procedure to validate the quality of service with each network operator. Very few systems have completed this process with the few carriers that exist. Some consider this to be “free long distance” or “flat long distance” far more competitive than standard business offers.

VOIP-enabled telephone systems: When we speak of a VOIP-enabled phone system, we are directly referring to the phone system’s ability to use Voice Over Internet Protocol language to carry your phone calls internally or between locations. We are not talking about the possibility of making your phone calls through a VOIP phone service provider as described above. Using VOIP internally gives you several advantages.

  1. Common cabling infrastructure: VOIP calls typically require between 16,000 and 64,000 depending on the level of compression, allowing a typical office data cabling infrastructure using CAT5e cabling to share the same 100M cabling for voice and data. Voice is prioritized over data to protect call quality, and dozens of phone calls could be made simultaneously with no noticeable impact on data speeds. Using a shared cabling infrastructure saves cabling installation costs as well as cabling maintenance costs.
  2. Simple moves, additions and changes: Changes to the configuration, which in the past would normally require an on-site technician visit, can now be easily made in-house. Although many manufacturers will argue that they can now perform this functionality via TDM technology and web interfaces, it has been VOIP systems that have brought this capability to the fore with industry-changing ease. For any business that knows its phone systems engineers by their first name, the ability to manage your own system will dramatically change your total cost of ownership. The reduction in MAC fees has made VOIP systems very desirable simply because they cost less to maintain. Systems management is now something that can be internal to over 95% of programming changes.
  3. Ability to connect offices: With VOIP capability, you can now connect offices via managed data connections, making your phone systems more cost-effective than ever. This gives customers a more transparent experience when dealing with employees from multiple offices and allows companies to offer a more customer-friendly environment. Toll Bypass is an added benefit and eliminates costly tolls between locations when using VOIP. The business case for using labor more cost-effectively was amazing. The ability to have a single receptionist taking calls for multiple locations can often be paid for in a year for a system. Depending on company size and configuration, allowing employees who were previously answering calls to shift to income-generating activities can prove to be a financial coup.
  4. The ability to manage remote collaborators: A major nationwide trend has been the hiring of remote workers for various roles. They may be sales, support or operations related, but the common challenge for all organizations has been the effective management of these people. With a VOIP system and a managed data connection, you can literally connect your remote worker to your phone system with a VOIP phone. This gives the employer access to the same management tools they use internally with other employees. With the right software applications, you can view real-time phone availability, number of calls made and received, call time, and all other relevant information.
  5. Easy database integration: For companies using CRM packages with TAPI or IMAP interfaces, a VOIP system can prove to be an incredible production tool. Incoming calls can be routed to the desired subscriber based on programming and assignment in the CRM. Screen pops allow users to see who’s calling before answering, sending to voicemail, or forwarding calls accordingly. Desktop call control also gives users the ability to dial numbers directly from their contacts with one click. Users can use all the features and functions of their desk phone from their PC screen. With labor typically being the highest cost for any business, tools that help make workers more efficient by the cost of minutes a day can have incredible payoffs.
  6. IP softphones: IP Softphones have proven to be an incredible tool for the right application. Make a lot of calls abroad? Do you have employees who travel frequently and need to connect to hotel phone systems? Need to connect to line appearance from trade shows in real time? With a software controlled SoftPhone, you can access full phone system functionality from your laptop or PDA device with a single phone USB headset! Many new applications are coming.
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There are numerous other benefits that VOIP systems offer over their more traditional TDM counterparts, but we’ve limited ourselves to the key benefits above. While TDM phone system options still remain a viable solution that is slightly less expensive upfront, we find that the projected TCO, or total cost of ownership, is often lower with a VOIP system due to the feature set available and production efficiency tools. For single-site businesses, telecom professionals typically recommend a hybrid system. A hybrid system is a business phone system based on inexpensive TDM technology but can add VOIP capabilities via a media gateway card. While VOIP is not a service priority for a business today, it’s important to ensure you have future-proofing should you decide to implement it at a later date.

Perhaps one of the last things companies consider when purchasing a phone system, but one they should probably consider a little more is the resale value of the phone system. Since telecom professionals regularly support their customers in recycling their old equipment, they know exactly what old equipment is worth. As with most aging electronics, only minimal value can be expected after five years, but the past year has seen a startling trend. Systems without VOIP capability have next to no value. When companies try to liquidate systems that are only five years old, they often find they have no customers because the systems lack VOIP capability. The dramatic shift to VOIP has literally wiped out generations of used telephony products as there is literally no demand. There will always be some demand for used inventory for the big manufacturers like NEC, Avaya, Cisco, Nortel and Toshiba, but all the others seem extremely weak investments at the moment. Although resale value shouldn’t be a major consideration when choosing which system to purchase, business owners should be aware that choosing a system with VOIP capability from a major manufacturer practically guarantees a reasonable resale value. As always, we recommend speaking to your local telecoms expert for assistance in choosing the right system for you.

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