VoIP has gained traction over the years with enterprises as well as SMBs. In the business world, people were eager to transition from legacy landline phone systems, aka POTS or "Plain Old Telephone Systems", to a digital system, aka VoIP systems. In this article, we'll go over the pros and cons of landline versus VoIP, and provide a deeper understanding on the trend of businesses moving from landline to VoIP.
What is a Landline?
A landline is the conventional connection of telecommunications, that is comprised of a telephone connected to a telephone line via a wire that transmits voice information by being connected to a traditional telephone company. For phone calls that are made locally, what the phone company does is that it loops your call with the individual who is receiving your call. The phone company is there to convert auditory information into digital information, in order for the voice message to be received via long distances. For these situations in which phone calls are to be made abroad, the auditory information which is converted into digital information gets transmitted to a satellite. This digital information is then transferred from the digital satellite onto another land-based phone system in the specific region or country which are you making the telephone call to. This digital information is then converted back to auditory information, this way completing a loop between yourself and the person who you are calling.
A landline is distinguished from both a VoIP system and a cellular mobile line, in the way that it transmits voice information. A cellular mobile line instead uses radio waves to transmit voice information, while a VoIP system converts voice information into digital signals that are passed along onto the Internet. The landline was invented thanks to the invention of the first basic telephone, by Antonio Meucci in the year of 1849. It is important to note, that the term “landline” is also widely used to explain and describe two or more points that are connected through a dedicated physical cable.
What is VoIP?
What is a VoIP system and what are the advantages and disadvantages that come with using a VoIP system? A VoIP (Voice Over Internet Protocol) is commonly known as internet calling. VoIP systems are comprised with software and hardware that enable individuals to make telephone calls via the Internet. Unlike with traditional mobile cellphone services and telephone systems that use the traditional circuit transmissions of the PSTN, VoIP systems use IP (Internet Protocol) to send and receive and convert voice data signals.
The way that this works, is that VoIP systems convert audio information into data that is then sent via the internet to the person who is waiting to receive the immediate voice message. In simpler words, what VoIP does is that it routes telephone conversations through a phone over a network cable, into a network, and then out into the internet. VoIP has revolutionized the way that traditional telecommunications work, by taking the entire phone communication concept and moving it over to the worldwide network. When you speak, it is being recorded as a digital conversation, and what you hear is the phone receiving these digital signals of your conversation and playing them back to you.
VoIP Advantages and Disadvantages
Let's go over the advantages of VoIP as it compares to landlines, as well as the potential disadvantages and how they can be mitigated.
Advantages of VoIP
There are a great number of advantages of VoIP, which explains the reason why so many companies and individuals are switching and replacing their traditional telecommunications service systems with VoIP.
VoIP is Cost-Effective
The first and most appealing factor that makes VoIP telephone systems advantageous is that they are very cost-effective, and in fact a cheaper alternative to regular telephone systems. The only additional cost in regards to obtaining a VoIP service is internet installation; however, if you or your company already has an Internet service running, then the setup cost for your VoIP telephone system will be especially small. This also means that the cost of using your VoIP telephone system will also be small, since you are merely using your already existing Internet service. In other words, if you are already paying for an Internet provider, then you are potentially already paying costs that you would have to pay to utilize VoIP service.
VoIP Saves Your Business Money
What is great about VoIP telephone services in the world of business, is that with VoIP, companies and businesses can focus on company growth without having to worry about payments for the installation of additional landlines within the business office space. Thus, investing in VoIP is a cheaper alternative, especially in the long-run.
VoIP Offers Custom Features
VoIP telephone systems come with additional features that are available to users with no additional costs. These additional features include call parking, call waiting, and call forwarding, which are all included in the VoIP features system. VoIP telephone services also grant users multimedia communications, with no extra service costs.
VoIP phone services also come with auto-attendants. This is a great additional feature for small businesses, as users will be able to make calls through a series of menu options in order to get the extension that is needed. Another feature that VoIP offers is its voicemail to email messaging and its voicemail to text features. This is great for users who are constantly on the go and out of the office for extended periods of time. This feature can also potentially benefit your business as users are able to easily track call analytics for business optimization.
In essence, in contrast to traditional telephone systems, VoIP systems converts your telephone into a computer-like system. This means that softphone features can be easily accessible via VoIP telephone systems. Such features could include CRM tools, project management apps, email marketing software, and sales software. With VoIP you can transform any electronic device into a telephone, including your tablet, your mobile device, and your computer desktop.
Related: VOIP Softphones VS IP Phones
VoIP is a Wireless System
Another great advantage with using VoIP is that it is a wireless system. What this means is that you do not have to necessarily be in your home or in your office in order to make or receive calls. If you are looking for a more portable form of communication within your office space, then VoIP is the best solution.
VoIP Provides Free Internal Calls
What is great about VoIP telephone services, and especially within office spaces, is that if you want to make a call to another user, then that service will be completely free. If your team for example wants to set up a conference call with another department, whether that department is located within the same building or not, the service will be free of charge.
Disadvantages of VoIP
As with all systems, VoIP systems also come with a few disadvantages; however these disadvantages can be overcome, depending on the company and organization.
Stable Internet Connection
The main disadvantage that comes with using VoIP is that you need a stable internet connection in order to use your VoIP service. If for example a great amount of bandwidth is being used within your office space through other devices, then it is possible that your VoIP calls could be affected. This is, however, something that companies can overcome, depending on their Internet service provider. It should also be noted that VoIP telephone services only need 10 kbps of internet in order to run successfully. Use a speed test to check your internet speeds.
VoIP phone services depend on your Internet service in order to run. In the case of a power outage, VoIP phone calls need to be forwarded to a secondary device. Without this secondary device, it will not be possible to make phone calls during a blackout.
Landline Advantages and Disadvantages
Traditional landlines come with a number of advantages and disadvantages. As previously mentioned, what truly distinguishes landlines from both cellular mobile lines and a VoIP systems is found in the and the medium through which landlines transmit and receive voice information. VoIP system converts voice information into digital signals that are passed along onto the Internet system, whereas landlines simply use physical media, such as fibre optic cables and wires, in order to transmit voice information. A landline is limited to physical transmission through a telephone company, whereas VoIP systems transmit information wirelessly by using Internet Protocol (IP). Let us go into the advantages and disadvantages of a landline.
Advantages of Landline
The greatest advantage with VoIP telephone services is that they are reliable and can be used at times that the Internet is being slow, faulty, or goes down. But with backup power and mobile phones, this same advantage is available with VoIP. Landlines are considered more reliable due to their ability to function during power outages, provided that your landline still have the ability to be powered without backup power. This is something that makes people consider landline services to more reliable in the circumstance of an emergency.
Disadvantages of Landline
The reason why companies and businesses are beginning to steer away from traditional landlines is that landline telephone services are significantly more expensive than VoIP telephone services. In fact, both landline installation and running costs are remarkably higher than VoIP installation and running costs.
Landlines are especially expensive for businesses looking to expand. The costs of additional phone lines and materials for use are expensive, together with the costs for setting them up and additional fees for upholding them.
Lack of Features
Landlines provide far less features than VoIP services do. Landlines do not have an option for multimedia communication. With landlines, you will only be limited to audio communication. If you want the additional features that VoIP services include and provide, they will come with additional costs. Features like SMS, hold music, call recording, call analytics, and much more, are not available from landlines.
VoIP vs Landline: Final Verdict
So what really is better? A landline service, or a VoIP service? Overall, the advantages that VoIP telephone systems have in terms of both costs and features prove to make VoIP the better alternative. The reason why landline phone services have an advantage is that they have a higher level of reliability; however, in our current technological era, reliability should not be a substantial issue. Most locations, especially in industrial and metropolitan areas, have decent internet connection available. and every business should have a backup battery source. Thus, the issue of connectivity and reliability in regards to VoIP is minute. The benefits that come with using VoIP telephone services are significantly larger than those that come with using a landline.
Firstly, VoIP offers greater freedom in the way that you choose to set up your service and the tools and programs that you would prefer to equip your service with. Secondly, VoIP services are much more cost-effective than landline phone services are, both in terms of running and installation. VoIP services are also more scalable for businesses, something that is a huge plus when it comes to growing a business.
VoIP is really the better and cheaper option. It comes with no surprise that so many businesses and entrepreneurs are increasingly investing in a VoIP phone services to substitute their landlines. While VoIP services are continuously evolving, landlines have become tremendously outdated. VoIP phone services are truly the future of telecommunications.
Related: VOIP vs SIP
History of VoIP
The earliest history of VoIP can be traced back to early 1970s when the Network Voice Protocol [NVP] was developed by Danny Cohen to carry real time voice over the Arpanet.
By the year 2000, entrepreneurs had already started exploring cloud-based solutions. The on premise IP PBX solutions gained popularity as they offered myriad benefits in the form of features, costs and productivity.
Early providers of voice-over-IP services offered business models and technical solutions that mirrored the architecture of the legacy telephone network. Second-generation providers such as Telzio have developed closed networks for private user bases, offering the benefit of free calls and convenience.
Related: What is a PBX?
Over Four Decades of VOIP
The following is a timeline of historic milestones and evolution of VoIP:
- 1973: Network Voice Protocol (NVP) developed by Danny Cohen and others to carry real time voice over Arpanet.
- 1974: The Institute of Electrical and Electronic Engineers (IEEE) published a paper titled “A Protocol for Packet Network Interconnection”.
- 1974: Network Voice Protocol (NVP) first tested over Arpanet in August, carrying 16k CVSD encoded voice – first implementation of Voice over IP
- 1977: Danny Cohen, Vint Cerf, Jon Postel agree to separate IP from TCP, and create UDP for carrying real time traffic.
- 1981: IPv4 is described in RFC 791.
- 1985: The National Science Foundation commissions the creation of NSFNET.
- 1986: Proposals from various standards organizations for Voice over ATM, in addition to commercial packet voice products from companies such as StrataCom.
- 1991: First Voice Over IP application, Speak Freely, released as public domain. Originally written by John Walker and further developed by Brian C. Wiles.
- 1992: Voice over Frame Relay standards development within Frame Relay Forum.
- 1994: MTALK, a freeware VoIP application for Linux.
- 1995: VocalTec releases the first commercial Internet phone software. Same year, Intel, Microsoft and Radvision initiated standardization activities for VoIP communications system.
- 1996: ITU-T begins development of standards for the transmission and signaling of voice communications over Internet Protocol networks with the H.323 standard. Same year, US telecommunication companies petition the US Congress to ban Internet phone technology.
- 1997: Level 3 began development of its first ‘softswitch,’ a term they coined.
- 1999: The Session Initiation Protocol (SIP) specification RFC 2543 is released. Mark Spencer of Digium develops the first open source private branch exchange (PBX) software (Asterisk).
- 2004: Commercial VoIP service providers proliferate.
- 2007: VoIP device manufacturers and sellers boom in Asia, specifically in the Philippines where many families of overseas workers reside.
Because of the bandwidth efficiency and low costs that VoIP technology provides, businesses are migrating from traditional copper-wire telephone systems to VoIP systems to reduce their monthly phone costs. In 2008, 80% of all new Private branch exchange (PBX) lines installed internationally had switched to VoIP.
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.