We’ve had the PSTN (Public Switched Telephone Network) – our existing wired telephone system – for a bit over 100 years now.\u00a0 It’s reliable, simple to use (even old people have figured out touch tone and caller ID), and for the most part works great.\u00a0 Why change?<\/p>\n
For one thing, it’s getting too expensive.\u00a0 With the advent of ubiquitous cell phones and free nationwide long-distance, the traditional phone companies have to get very creative in finding ways to tack on more fees to compensate for the lost revenue from people dropping their phone lines and long distance service.\u00a0 With less people installing and maintaining wireline phones, that cost must be spread over less people, with more costs per line. Most of my small business retail clients have 4-5 phone lines, which average over $300 per month.\u00a0 That’s getting pretty expensive for a small business.<\/p>\n
What is VoiP?\u00a0 It’s a way of making\u00a0a traditional phone\u00a0call over a computer network (like the one in your office or over the internet).\u00a0 Why is it important?\u00a0 Most people have intra-office computer networks and most\u00a0offices are connected to the internet, so you really don’t need a whole separate setup (phone lines and separate wired phones) to use VoiP.\u00a0 That saves lots of money.\u00a0 Also, most internet connections are not data-limited, so you’re not paying extra for the extra data traffic for your phone calls.<\/p>\n
VoiP also provides a lot more flexibility.\u00a0 Want an office phone extension at your house?\u00a0 No problem, as long as you have a decent internet connection.\u00a0 Want to\u00a0dial another office coworker\u00a0in a different city\u00a0by dialing\u00a0an internal extension (and not be charged long distance)?\u00a0 Again, no problem.\u00a0 Want a complex automated attendant script with IVR prompts?\u00a0 Easy with the right VoiP setup.\u00a0 All these features were available previously with the wireline phone network, but they were so expensive that only large companies had them.\u00a0 Now, any SMB with an internet connection can have the same features as large enterprise companies.<\/p>\n
What is the downside?\u00a0 Well there are a couple.\u00a0 One, since the internet (and your internet connection) is not as reliable as the good old PSTN, your phone will only be as reliable as your data connection.\u00a0 My home DSL has only gone down a couple of times this year that I can tell, and not for very long, so this problem is getting much better.\u00a0 Second, there are a few legacy devices that don’t work as well over VoiP as they did over analog telephone lines.\u00a0 Namely old fax machines and POS modems.\u00a0 If you’re still using dial-up credit card validation, then you’re probably going to need at least one analog line\u00a0 (I really wish AmEx would move into the 20th century and go to IP validation!).\u00a0 On the other side of that, I have one customer that relies entirely on IP validation and doesn’t even have a back-up analog modem, and they have been operating without a problem for over a year.<\/p>\n
The bottom line.\u00a0 If you have multiple analog phone lines or you use lots of long distance or you need those big-office features (automated attendant, remote extension dialing), you can save a bunch of money\u00a0by considering VoiP.\u00a0<\/p>\n
VoiP is coming on strong, and it is here to stay.\u00a0 I predict that\u00a0half of all\u00a0analog phone lines will gone in 10 years and most will be gone in 20.\u00a0Are you ready for\u00a0the new generation of telephone?\ufffd