VoIP, short for Voice over Internet Protocol is the latest telephone technology to become ubiquitous enough to disrupt how businesses are communicating in the 21st Century. But to understand its impact, it’s helpful to compare it to what Alexander Graham Bell designed as the first POT, aka the ‘Plain Old Telephone,’ or the Public Switched Telephone Network (PSTN).
Circuits or Packets?
Circuit-switched versus Internet telephony works when a dedicated circuit is established between two points. The system is based on copper wires carrying analog voice transmissions over these channels. VoIP on the other hand is packet-switched where one’s voice travels to its destination in countless network ‘junks of data’ across the Internet.
Individual packets often take different paths to get to the same destination. They travel through a fairly narrow time window and are assembled in the correct order when they arrive to be intelligible to the recipient. VoIP technology employs encoding schemes and compression technology to reduce the size of the voice packets so they can be transmitted more efficiently.
Why stick with your old POT?
While there have been a countless number of early adopters that have made the VoIP switch, some small businesses still want to retain their plain old telephone. The obvious benefit of using a POT-based business phone system is that it is the most familiar. There’s no software necessary and there are no learning curves or training required for employees to use landlines.
So old-school doesn’t necessarily mean it no longer has value. Last century’s legacy technology has built-in reliability, security and emergency location services.
Additionally, with your POT, service remains active during power outages because phone jacks do not require electricity. And emergency calling is enabled and services are traceable to the remitting location.
Why jump ship?
Voice over Internet Protocol telephony has several advantages over POT, starting with cost savings. On average, a business phone service rental runs around $35-45 per line per month, plus additional charges for long-distance calls dependent upon on one’s telecom service.
On the other hand, using a VoIP service like Telzio, a business can take advantage of advanced professional features starting as low as only $1 per month. Plus small businesses don’t have to be concerned with scheduling appointments for installation, since their set-ups are intuitive and require no hardware or long-term contracts.
The Federal Communications Commission (FCC) published its annual Local Telephone Competition report based on data obtained through June 30, 2013. It cited that 47% of residential patrons and 15% of business customers who had a landline service are now using VoIP and that nearly 38% are buying that VoIP service from companies other than their incumbent telecom company.
In another survey, the Centers for Disease Control (CDC) measured how many consumers had wireless vs. wireline phones. In its annual report, the CDC found that “two in every five American homes (41.0%) had only wireless telephones (also known as cellular telephones, mobile phones or smartphones) during the second half of 2013.”
Contrasted to being tied to a landline in a stationary or sedentary position, VoIP via smartphones allow users to move about, commute from one work location to another, and even exercise (if you choose) while you’re communicating.
It also has a modern-day vibe. Having voicemails sent to your email as text messages, find me/follow-me which rings your mobile and home phones as well, video calling, conference calling, integration with third party applications like CRM are features lacking with your old POT.
Remember Dial Up?
So, if you’re still on the fence as to whether or not landlines are a bit anachronistic in today’s society – think about this: Remember not too long ago when you had to use a dial up to get a DSL (Digital Subscriber Line) Internet connection? Due to the excessive number of dropped calls and exorbitant costs, customer complaints virtually forced technology to come up with a better solution.
And while telecom services today still offer enhanced DSL systems through copper phone lines, the trend has been transitioning toward cable modem technology offering broadband Internet connections via cable TV lines. If technology for the Internet has moved in that direction, don’t you think business’ telephony systems should as well?
Ron is part of the marketing team at Telzio, covering everything from tips and tech for growing businesses to customer success stories for the Telzio blog.