What is VoIP and is it Right for You?

by Pierre Lutgens

VoIP is a process of digitizing and sending voice telephone signals over the Internet or other data network. Enterprises of all sizes can benefit from this technology, but they must do some basic research to figure out if VoIP is right for them. Which vendor should I call? Would I rather deploy and manage my telecommunications inhouse, or does it make sense to outsource to a hosted services provider? How much will this cost, and how much money can I save in the long run?

The first thing most people realize about VoIP technology is that it can save their business money by reducing or eliminating the toll charges for long-distance and even local calling. However VoIP is much more than simply a plan to lower a company's phone bill. There are many so-called "soft" benefits enabled by VoIP, such as increased worker productivity, the ability to collaborate among multiple branch offices, and lower operational expenditures as a result of simplified management schemes.

The first thing many people think about VoIP is that this technology is primarily a cost-saver. For many enterprises, that is enough of a reason to consider VoIP. Of course the cost element has many aspects to it that merit consideration. Tremendous cost savings come in the form of lower telephone bills. By converting voice into packets and transporting these packets over an IP network, corporations are able to avoid the Public Switched Telephone Network (PSTN) and the tolls associated with that. In the case of an enterprise with multiple branch offices, this is especially true. By using the company's data network, enterprises can eliminate all costs associated with calling between branches. Furthermore, they can have all locations served off of a single IP PBX, thus enabling extension dialing between far-flung locations. By simply dialing a coworker's extension, you can speak to a distant colleague as if they were in the very next cubicle.

VoIP enables seamless call transferring to experts across a connected enterprise, be they in the same building, across town, or across the globe. If the data network reaches a remote location, so too do the telephony applications that are enjoyed by employees at the main corporate location. Applications such as conferencing, voice mail, unified communications, click to dial—all of these new productivity-enhancing services are enabled across the enterprise. But managing the system is simplified due to the elimination of the need to look after multiple networks.

VoIP reduces the cost and complexity associated with moves, adds, and changes. Many enterprise VoIP solutions allow administrators to manage the system via a web-based browser interface and enable managers to enact changes to an employees phone settings and voice mail settings (for example) remotely, and without the need to call the phone system's manufacturer to send a representative to make those moves, adds and changes. Irrespective of the significant cost savings this flexibility may be what makes you decide that VoIP is for you.

Pierre Lutgens is the director of Your Local Telecom