Placing a VoIP call is no different than how you currently place or receive calls. You would use VoIP the same way you use a regular landline, by picking up the phone to answer it or dialing a number to place a call. VoIP enabled hardware is required.

Derek is the busy Vice President of Sales for a company based in Los Angeles. He has chosen to tap into the flexibility and mobility that VoIP phone service (also called hosted PBX service, I-PBX, or virtual PBX) offers in order to work from his home in another city several days a week. When his office phone rings, his home or cell phone rings simultaneously. Derek picks up the line, and his clients have no idea that their call is being answered away from his office since he is fully connected to his office network.

This flexibility and mobility, along with reduced long distance bills, has caused many businesses to either make the switch, or consider switching to a VoIP (Voice over Internet Protocol) phone system in the near future. In 2006, McKinsey consulting published the results of a survey of 77 corporate CIOs. In the study, 53 percent of the executives stated that they plan to make their greatest capital expenditures in the near future on an improved information technology infrastructure. Their plans included incorporating VoIP phone service.
 

Why the Growing Interest in Business VoIP Phone Service?

One of the initial draws of VoIP for businesses has been attractive long distance rates, with fee reductions of up to 75% over traditional phone services. “The real beneficiaries of rate reductions are businesses with multiple employees in different locations,” says John Scarborough, a former Vice President of Marketing at Qwest Communications who co-founded IP5280 Communications, a Denver-based firm specializing in business VoIP hosting solutions. “If employees are in different locations, calling one another is as simple as dialing a four-digit extension, and there’s no long-distance fee for domestic calls.”

This savings is due to the fact that business VoIP service is a digital-based technology that views users on the same network as ‘local’, regardless of their physical location. VoIP service providers don’t have aging equipment infrastructure to maintain, such as seen with traditional phone service. As a result, service providers can pass on extra savings to their customers. For instance, most VoIP service provider offer features such as follow-me roaming, voice mail, voice mail to email, caller ID and simultaneous ringing of cell phones and home phones, which can cost quite a bit with traditional phone service, at no extra charge.
 

VoIP Makes “Reach Out and Touch Someone” a Reality

Cost reductions are only the beginning of the advantages a “plugged in” business can begin to enjoy with Voip PBX services. Once hosted PBX service is in place, moving an employee phone is as simple as unplugging the IP phone and plugging it in at the new location. The phone number moves with the user and, with a minimum of hardware and no costly reconfiguration of circuits required.

 

This mobility isn’t limited to the office, though. VoIP phone systems are a good choice for companies with employees who travel and or work from multiple offices. With VoIP telephone service, individuals can answer the office phone from their IP phone or laptop, even if they are sitting at a hotel in another country.

 

Work from Home – and Nobody Knows

As mentioned at the beginning of this article, this mobility allows employees to receive calls from work at home – just as if they were at the office. An IP phone can be programmed with business rules, such as “From 5 pm to 7 pm in the current time zone, calls to the office phone will be routed to my cell phone.’ Customers never need to know that the person answering their call is not still in the office, unless they choose to disclose this fact.

Some providers will allow businesses to purchase “virtual” numbers with area codes for another city or state or country, for a small monthly charge. For instance, calls from an office located in California can originate in Texas, but be charged as a local call, by using the pre-programmed California number assigned. Using this same feature, businesses located outside the U.S. can obtain a local number for business purposes. But be aware that some VoIP service providers charge for long-distance calls that terminate off the network, as compared to unlimited calling within the same network, or to a local region for that area code.
 

Greater Interconnectivity with other Data Technologies

Because VoIP is a data-based technology, it allows greater interconnectivity with the company data network. These capabilities will vary with the VoIP hosting provider, who provides templates that allow the customer to integrate voice with other data sources. Some will even create a custom application if a business requires it.

For example, a business may choose to place a “Click and Call” feature that allows instant access to customer support from the company website. With Web and video conferencing, they can even see who they’re talking with, for a more personalized experience. An application can also be designed that allows customer service representatives to see a pop-up when customers call which provides customer account and contact information for improved service quality.

A VoIP system can be used to screen where calls are routed. Calls can be routed to an automated attendant, even for employees in multiple cities. This lets a small company appear larger. When customers call, they will hear, “To reach Jim Smith, enter 4111, to reach John Jones, enter 4122,” etc. The customer never realizes that each employee is in another city, state, or country.  VoIP can also be programmed to block certain phone numbers, or place them on “virtual ring”, where the call never comes through.

Rapid credit card machine authorizations are another business benefit of VoIP phone service with the low cost option of adding additional lines as data lines. “The credit card machine line can be ‘on’ all the time, and provides lightening-fast validations,” says Scarborough. “It’s also a very cost-effective solution for point of sale systems. Instead of a cash register dialing into the network, it can be kept on 24/7, at little charge.”
 

Centralized Communications Management

The main benefit for many businesses is that VoIP telephone systems improve employee productivity. Using a VoIP service, a person can click into their Outlook contacts and ring a customer directly, cutting down on the time required to look up the phone number. Derek* has noted that he has become so used to these features, that, “I feel ‘naked’ when I’m without my IP phone,” he says.

VoIP phone systems also allow truly centralized communications, with voice, email, and faxes managed via Outlook and an IP phone. Calls received can be programmed to ring simultaneously on both a cell phone and landline phone before being forwarded to voice mail. The voice mail can also be forwarded via email in a sound file. And to make responding to messages easier, IP phones allow employees to instantly look up contact information within the company’s customer data base.

VoIP phone system also makes it easier to hold virtual employee conferences, even if employees are at different locations. An icon similar to the “available” and “busy” alerts on instant messaging let others know when an individual is free to talk. If their line is busy, you can send them a voice mail that also goes to their email box, letting them know when you want to confer. And during a virtual conference call, documents can be shared, since everyone is online. “The collaborative and productivity possibilities with VoIP are almost limitless,” says Scarborough, “and will only grow over time.”
 

Say Goodbye to the Phone Guy

Many businesses staff employees to support maintaining their phone service, and IT services. Because business VoIP telephone systems are IP based, maintenance and system support can often be transferred to the IT Department.

In addition, having voice and other network data on one merged system reduces the cost of maintenance and support significantly.
 

Are there Drawbacks to Using VoIP Phone Services?

VoIP technology is improving rapidly, but there are still issues that must be taken into consideration. Concerns about voice quality have been raised by those who remember the early days of VoIP telephony, but these have been resolved in recent years. “With business-grade VoIP, the voice quality is often better than that seen with Ma Bell,” says Scarborough. “This is because the equipment for business grade VoIP is much better than that normally used for consumer service. Instead of the voice signal going through an adaptor to convert an analog signal into digital form, business IP phones have an Ethernet jack that plugs directly into the network, resulting in much better voice quality.”
 

Security

The security of VoIP is another concern raised. But in reality, an IP phone system is no less secure than the rest of the network. “A hacker cannot access your voice traffic any more easily than they could access your other company data,” says Scarborough. “In essence, your company network security level will determine how protected your voice data is. If your network supports encryption, then VoIP traffic will also be encrypted.”

For businesses without an encrypted network that would like extra security, a growing number of software companies are specializing in providing VoIP security features. But in the end, VoIP is no less secure than traditional phones. “What most people don’t realize is that it’s actually easier for someone to tap in and listen to a traditional phone line,” says one VoIP provider executive. “It’s harder to ‘listen’ in on VoIP calls, because of the nature of the technology, where they have to pick up on each packet transmitted.”
 

Service Options for Businesses

Most small businesses will want to choose a hosted VoIP service, where the equipment and maintenance are handled by the hosting service provider. This allows for extremely rapid installation of a new system in most cases, normally within weeks (“But it can take up to a month if the existing business number is to be ported to a VoIP service provider,’ notes Scarborough).

The number of providers offering hosted VoIP phone services is growing rapidly. Their competition for your business lets you find the best possible rates and features. VoIP makes sense for businesses that are exploring ways to reduce their telecommunications fees. The technology has gotten better; it’s cheaper, and can be implemented relatively rapidly. But beyond cost savings, it allows businesses to access a large number of features that are unavailable to them with traditional phone services.

“I believe that the greatest advantage of VoIP phone services is that it allows a business to ‘future proof’ its phone system,” says Scarborough. “All too often, a company will invest $30,000 (or more) into a traditional system that works for them for a few years, and then they discover they’ve outgrown it. You don’t outgrow your VoIP service, because it’s simple to add new lines and phones, and to align features to communication needs of the individual user. Businesses that use it know they have access to the latest features, since these are always being upgraded with the latest VoIP hosting software.”

For many businesses, the future will be leveraging VoIP services, with reduced costs and the ability to integrate voice with other data-based technologies. The bottom line is improved customer service and higher productivity, and VoIP service is proving that it delivers both to a greater degree than was possible before.

Use it like you would use any telephone. Simply pick up the phone, wait for the dial-tone, and then dial the telephone number of your choice. There are no extra numbers to dial and no special routines to follow. It's that simple.

You don't have to be a tech wizard to VoIP service; you only need to be someone who would like great prices and great features provided by their phone company every day.

If you would like to surf the web and use your VoIP service at the same time, have no fear, because you can share your Internet connection with your computer. Talk on the phone and surf the net at the same time with ease (depending on your home network setup, this may require additional equipment). When going with a phone to phone setup most VoIP providers will provide you with a phone adapter. You can also use your computer and a headset to make VoIP phone calls through your computer with a simple piece of software and no additional equipment.

VoIP services provided by broadband phone companies typically include many standard features with their plans that are usually listed as “advanced” by traditional phone service companies and thus have additional costs. Some of these features include Caller ID, Voicemail, and Call Forwarding. The four diagrams below illustrate how calls are routed in specific scenarios. The last diagram of the four is an illustration of the most typical call path when making a call using a company such as Vonage or SunRocket.

VoIP services convert your voice into a digital signal that travels over the Internet. If you are calling a regular phone number, the signal is converted to a regular telephone signal before it reaches the destination. VoIP can allow you to make a call directly from a computer, a special VoIP phone, or a traditional phone connected to a special adapter. In addition, wireless "hot spots" in locations such as airports, parks, and cafes allow you to connect to the Internet and m ay enable you to use VoIP service wirelessly.

Some VoIP providers offer their services for free, normally only for calls to other subscribers to the service. Your VoIP provider may permit you to select an area code different from the area in which you live. It also means that people who call you may incur long distance charges depending on their area code and service. Some VoIP providers charge for a long distance call to a number outside your calling area, similar to existing, traditional wireline telephone service. Other VoIP providers permit you to call anywhere at a flat rate for a fixed number of minutes.

Depending upon your service, you might be limited only to other subscribers to the service, or you may be able to call anyone who has a telephone number - including local, long distance, mobile, and international numbers. If you are calling someone who has a regular analog phone, that person does not need any special equipment to talk to you. Some VoIP services may allow you to speak with more than one person at a time.

If you're considering replacing your traditional telephone service with VoIP, there are some possible differences:

• Some VoIP services don't work during power outages and the service provider may not offer backup power.

• Not all VoIP services connect directly to emergency services through 9-1-1. For additional information, see VoIP & 911 Advisory.

• VoIP providers may or may not offer directory assistance/white page listings.

In June 2005 the FCC imposed 911 obligations on providers of “interconnected” VoIP services – VoIP services that allow users generally to make calls to and receive calls from the regular telephone network. You should know, however, that 911 calls using VoIP are handled differently than 911 calls using your regular telephone service. Please see our consumer fact sheet on VoIP and 911 services for complete information on these differences.

In addition, the FCC requires interconnected VoIP providers to comply with the Communications Assistance for Law Enforcement Act of 1994 (CALEA) and to contribute to the Universal Service Fund, which supports communications services in high-cost areas and for income-eligible telephone subscribers.

Aspects of these considerations may change with new developments in internet technology. You should always check with the VoIP service provider you choose to confirm any advantages and limitations to their service.

For more information about VoIP see our factsheet (pdf file).

VoIP phone service is growing in popularity. Many of the drawbacks seen when it was first introduced have been addressed by improvements in equipment and ISP connectivity. Not every business may be a candidate for VoIP, but a growing number are choosing to use this digital-based phone service option like Jive to enjoy reduced rates and improved productivity, as well as scalability for future growth.

Where do you start, when you finally decide to make a change to voip? Setting up a small business voip could be challenging and required a lot of research. This 8 pointers would guide you to your first steps in taking a plunge to business VoIP system.

1. Your Network Capacity

First and foremost, you need to know your network capacity. Is it sufficient to sustain network flow? Do you have proper LAN setup for VoIP?Without the network, you won't have the infrastructure to utilize VoIP services. Have your network administers ensure that you have this fundamental requirement checked off your list.

2. Internet connection

Know your available bandwidth for your small businesses. Each and every business has its own needs and requirements, so, when you are switching to VoIP services, you also need to ensure you have proper bandwidth for VoIP network to work seamlessly. Use our VoIP speed tester to test your current internet connection.

3. Calling Habits

if you are making more local calls than long distance call, switching to VoIP might not help you to save on phone bills. On the other hand, when you do make lots of long distance calls and international calls, you can optimize the savings.

4. Publicly Switched Telephone Network - PSTN (landline)

Always remember that small business VoIP systems require Internet connection and electricity to work. It is always advisable to have land line as backup for your small business, in case of power outtage due to earthquake, fire, snowstorm, and all other natural disasters. In any case, when and if your network goes down, you could still make phone calls.

5. Premise or Hosted Phone System

Depending on how many users on your small business voip network, you can choose to have on premise PBX or Hosted PBX. If you are running a small business with less than 15 users on small voip business network and you do not want to deal with the phone system, you are better off to have a hosted PBX. It costs more to have hosted system, but it takes away your misery in case the system goes down.

6. Voip Service

When it comes down to the small business VoIP Service, you have a lot of options available. There are many VoIP providers offering many different variety of services, options and service plans. Do intensive research to find the best voip plan that works with your small business. Visit our Business VoIP comparison page to start your research.

7. VoIP Equipment

Many providers would provide you basic or standard equipment when you sign up with their service. Find out what your small business voip needs are and make sure to find the compatible equipment that work with your service provider. If you know what you need, visit our VoIP Equipment section to get the necessary equipment.

8. Budget and ROI

Budgeting your small business voip would be wisest move for switching to VoIP. Do you want to pay everything upfront, or do you want to have recurring monthly plan, or some upfront with financed options? Each provider has different financing options, contact the providers directly for more details and have comparison analysis before selecting the service. And of course ROI needs to be calculated into the budget. Calculate how much you would save if you pay make the switch to voip versus regular landline.

The way it works is simple - using your high-speed Internet connection let your new phone service provider host the PBX for your business at their office location. Enjoy the most enhanced business phone features with a scalable system that you control and manage.

A hosted VoIP PBX phone system is a money saving alternative to traditional phone service for a business of any size. Existing companies can retire costly, high-maintenance phone equipment rooms and new companies can avoid the painful upfront hardware and installation fees by choosing a hosted solution.

The way it works is simple - using your high-speed Internet connection let your new phone service provider host the PBX for your business at their office location. Enjoy the most enhanced business phone features with a scalable system that you control and manage.

NOTE – Small businesses may be able to use existing phones by way of connecting an adapter to an office Ethernet cable, but companies with 5 or more employees may need to purchase IP phones to take advantage of the hosted service.

Keep all of your existing phones and service without the hassle of maintaining your own business phone system with a virtual PBX solution. A virtual PBX offers many advanced call handling features with a system that is easily manageable while utilizing the existing phones within a business.

Like a hosted solution, the office PBX is maintained by the service provider but there is no need to purchase new IP Phones or run Ethernet lines to connect phones within the office. Start saving money with little to no investment with a virtual PBX phone system.

NOTE – Though a virtual PBX is one of the most cost effective solutions, many providers do not offer the full range of advanced features found with hosted PBX services.

Keep your existing phone system and enjoy the cost saving benefits of switching phone service to VoIP by incorporating a SIP trunk. A SIP trunk provides additional features similar to a hosted PBX Solution and can provide business with additional solutions, including:

• Increasd realibility backed by the SLAs of SIP Trunk Providers
• Caller ID
• DID calling for every extension
• Local and long distance calling
• E911

Depending on your business's needs, an on-premise VoIP PBX, IP-PBX, or digital PBX system may fit your needs better than a hosted PBX service. An on-premise PBX phone system gives you:

• More flexibility regarding features because the equipment is on-site and owned by your company.
• More control over managing your phone systems daily operations.
• No surprises. If you own your telephone system, you know what to expect from it.
• A simple way to expand your phone system when your company expands.

A broadband (high speed Internet) connection is required. This can be through a cable modem, or high speed services such as DSL or a local area network. A computer, adaptor, or specialized phone is required. Some VoIP services only work over your computer or a special VoIP phone, while other services allow you to use a traditional phone connected to a VoIP adapter. If you use your computer, you will need some software and an inexpensive microphone. Special VoIP phones plug directly into your broadband connection and operate largely like a traditional telephone. If you use a telephone with a VoIP adapter, you'll be able to dial just as you always have, and the service provider may also provide a dial tone.