What is VoIP and why should you care?
The current situation
Domestic users rent analogue telephone lines. Business users rent digital telephone lines, called ISDN lines. Small installations use a variety called ‘ISDN 2’ and larger installations use ‘ISDN 30’.
ISDN phone lines are usually connected to a telephone system on the company premises, normally an anonymous beige box located near Reception or in the comms room. This is often referred to as the switchboard or ‘PBX’ (Private Branch Exchange). Employee’s telephone handsets connect to the PBX via internal cabling. The main purpose of the PBX is to route incoming calls to a particular extension, to allow internal extensions to call each other, or to allow an extension to access an outside line. Most PBXs provide additional functionality such as music on hold, voicemail etc. In addition, many systems allow inbound callers to bypass the switchboard operator and directly access a specific internal extension – this is known as DDI (Direct Dial In).
Most PBXs are rented or leased, in addition to which a yearly maintenance fee is charged. The company can therefore incur four different landline charges – line rentals, call charges, PBX rental and PBX maintenance.
In 2025 BT will decommission their ISDN network so business will need an alternative. The most common alternative is VoIP (‘Voice Over Internet Protocol’).
A layman’s guide to VoIP
Computers send and receive ‘packets’ of digital data. These packets are routed to and from your computer across the internet by a set of rules known as ‘Internet Protocol’ (‘IP’).
A telephone conversation is an analogue signal. This can be converted into a digital signal in the same way as vinyl records are digitised onto a cd. VoIP telephone handsets contain circuitry to do this. Once analogue speech has been converted into packets of digital data, these packets can travel across the internet (via ‘Internet Protocol’) in much the same way as – for example – an email.
If one party to a telephone call does not have a VoIP system, at some point the call will “break out” into the conventional telephone or mobile telephone network. In that way a VoIP phone can talk to a conventional phone, or vice-versa.
Benefits and cost savings
VoIP is usually delivered as a cloud service. The physical PBX on company premises is no longer needed and is replaced by a virtual PBX – a bit of software – in the cloud. A system administrator (or an individual user) can log into an online portal and configure this virtual PBX. In most cases the cloud PBX offers a huge range of functions and is highly configurable. Individual staff handsets are swapped for VoIP handsets which plug into the same data points as their computers, not their old telephone points. This can be useful for smaller sites who only have a data connection, as a telephone can be quickly and cheaply added without installing another line.
Dispensing with physical PBX and ISDN lines offer obvious cost savings. Most VoIP service providers include a ‘bundle’ of call minutes per channel per month, so call charges are reduced. In return the user pays a monthly fee for each ‘virtual’ phone line (VoIP channel) along with other services.
(Incidentally, dispensing with your on-site PBX need not mean losing your receptionist/switchboard operator. VoIP systems can be configured to accommodate this).
VoIP systems take up capacity on the company’s data connection. If the data connection is slow, voice calls and normal data traffic will fight for space and invariably the voice call will lose. If the company is located a long way from the nearest exchange so receives a weak ADSL service, installing a VoIP system will almost certainly result in dropped calls and poor call quality. For example – if a VoIP call is in progress and a staff member uploads a large data file, the call will break up or cut out which will soon frustrate staff and annoy customers. Having a fast data connection – fibre or better – is vital to ensure that VoIP systems work properly. Unfortunately, businesses are often advised otherwise by aggressive sales tactics and the results are hard to rectify.
What should I do?
Here are some basic questions businesses should ask themselves before considering a migration to VoIP:
- How old is your company PBX? How long has the rental/lease left to run? How much do you pay?
- What data connection do you have? What speed, upload as well as download? Is fibre available in your area, and if not when?
- How many staff do have? How many ISDN lines do you currently rent? Do you have plans to change headcount or move premises?
- Are voice calls a business-critical aspect of your business? Do you have a strong mobile/4G signal in your area?
- Do your staff often upload large data files during normal business hours?
Can Auditel help?
As always – getting early, impartial advice can save a lot of headaches, disruption and expense in the long run. A malfunctioning telephone system can (alarmingly quickly) alienate your customers and damage profitability and reputation. Auditel is not a supplier – we are an independent, impartial telecoms advisor (and have been for 22 years). We would be glad to be of assistance – please refer to ‘Contact Me’ for an informal chat before making an expensive decision.