Changing your old office phones to a completely new system can seem like a daunting task that leaves you asking – is it worth it? In this article I’m going to outline the cost benefits of switching to a VoIP service from beginning to end.
Not only will you find that switching to VoIP will save you money, but a hosted phone system is also very easy to set up and comes with a full set of enterprise features. Without any technical background or VoIP familiarity, you can upgrade to a fully-featured hosted phone system through your web browser literally in minutes.
First, let’s go over some basics.
What is VoIP?
VoIP, or Voice over Internet Protocol, is a way of making phone calls through the Internet similar to the way Skype makes video calls. VoIP service has been replacing traditional phone lines across residential and business communications since 2004, causing telecom companies to spend substantial resources to transition away from analog lines and adapt to newer technology. New software companies have also emerged to fill the niche in this new VoIP solutions market.
Who’s using VoIP?
VoIP is used around the world by residences, small businesses, and large corporations. Most small and medium enterprises who haven’t already switched are planning to migrate their systems to a hosted VoIP solution in the near future. Businesses who need professional phone features and an affordable, web-based solution look to hosted VoIP providers.
What are the typical cost savings with VoIP?
The average savings businesses see after switching to VoIP range anywhere from 30% to 75%. While the amount of savings can vary greatly by case, most companies see a reduction in their phone expenses.
How are VoIP savings that drastic?
There’s no equipment. Making calls over the Internet is dirt cheap! Not only that, hosted phone systems eliminate the need for in-house servers along with their expensive equipment fees. A hosted phone system means that everything is handled off-premise “in the cloud”, so the expense of servers and maintenance is shared among the subscribers and everyone saves money.
Making changes is easy and free. The Internet makes it easy to develop feature-rich applications that can be used by anyone, so adding features, users, phone lines, and any extras can be done through a web browser without paying for an on-site technician every single time. Because it’s so easy to do everything online, businesses end up saving on all the service fees for making any changes to the system.
There are no long distance charges. Sending a call via Internet is way cheaper than sending a call via analog telephone lines. Depending on the provider, VoIP service allows you to make international calls at local rates.
When you make an international call, the VoIP provider connects to the country being called and essentially initiates the phone call from within that country so you end up paying their local rate.
The Cost Benefits of Upgrading to a VoIP Service
Here we’ll break down the cost benefits for operating the critical components of your business phone system from setup and installation to scaling and migration. What’s it really going to cost to set up and run a hosted phone system? What will it cost in the future to scale, move, or expand offices?
While the true switching costs could be significantly different for every business, the basic financial requirements for implementing a hosted VoIP solution are minimal and well worth the long term benefits beyond the setup process. Even through growth and operational changes, the convenience and flexibility of a hosted phone system keep costs at a minimum.
Setup & Installation
Typically there are zero or minimal setup fees for registering new phone numbers. Local and toll free numbers can be purchased online from virtually any area code in the world and they’re instantly activated. Generally, VoIP service providers will have a list of numbers to choose from, and you can also port/transfer existing phone numbers for zero or minimal fees without experiencing any downtime.
VoIP service can be used with existing phones by purchasing a small adaptor for $40 that connects the regular phone to the Internet and enables it to make and receive VoIP calls. New IP phones can be purchased from around $50 or $300-$600 for high-end models. For many businesses switching to VoIP, office phones are by far the greatest and sometimes the only initial expense.
For remote workers, VoIP can be used with softphones which enable you to make and receive calls with your VoIP number on your mobile device. There are softphone apps like Bria for $7.99 that you can download for iPhone and Android that are easy to use and compatible with most VoIP providers.
Programming & Custom Settings.
With a hosted VoIP service, setting up and managing features, users, and phone numbers is all done online with virtual tools, so there’s zero programming involved and zero dollars required for IT support. Hosted VoIP providers offer web-based management portals to set up, edit, and administer all features, users, and data – like voicemails and call recordings. Many small business VoIP solutions have a step-by-step setup process to help you design your phone system like creating a phone menu and adding features, so even non-technical users can setup an entire business phone system without any programming.
Hardware & Equipment
Switching to a hosted VoIP service means eliminating all on-premise server equipment. By moving communications to the cloud, businesses share the burden of hardware and maintenance with other subscribers to lower overall costs. Instead of housing equipment at every office location, businesses can access a single virtual phone system for all operations without purchasing any new equipment.
Administration & Support
Daily management of hosted VoIP phone systems is usually done through a customer interface online where changes can be made without technical assistance. Businesses save on ongoing service and maintenance fees every time they need to make an update to the system by making changes online instantly.
Subscriptions & Usage
VoIP providers typically offer various plans with bundled minutes so you might never pay for usage at all. We currently offer pay-as-you-go plans, to plans with dozens of PBX features included out of the box. If your business is a high volume call center, you will definitely notice the dramatic cost savings on usage after switching to VoIP.
System Maintenance & Updates
Switching to a hosted phone system means that you never have to worry about system updates or maintenance issues ever again. All costs related to server issues and hardware malfunctions fall on the shoulders of the VoIP service provider.
Scaling & Migration
Since hosted phone systems are administered through a remote online control panel, scaling operations across physical office locations and within organizations is easy and immediate. With a hosted phone system, your business is never tied to any particular setup or location and you can scale your phone system as your business grows.
VoIP Cost Analysis
To help small businesses figure out their potential cost savings with a hosted VoIP solution, check our the cost estimator on our pricing page.
Switching to VoIP
Check the pricing and test the usability for different small business VoIP solutions to decide which service provider will give your business the most value. Test the service with one team or office first, or try a temporary phone number before permanently transitioning your entire system. VoIP phone service works with standard office Internet connections, so there’s no reason not to start exploring VoIP solutions today.
Diana is the Chief Customer Officer at Telzio and enjoys helping customers get the most out of their Telzio services.