Have you taken the leap? A number of companies throughout the world have opted to replace the legacy PBX (News - Alert) with a VoIP switch so as to enjoy streamlined communications at a fraction of the cost. This focused move to the cloud is a trending phenomenon that has taken hold in markets throughout the world, including New Zealand.

According to Frost & Sullivan (News - Alert) researcher Audrey William, the on-premise market still accounts for the majority of voice revenue. The noted shift, however, is toward hosted and cloud-based voice and unified communications (UC) solutions. William shared her insight in a TechDay post.

The last 12 months, says William, has shown year-on-year growth for traditional voice in New Zealand and Australia to be flat. The growth seen in hosted and cloud-based communications supports the findings published in an IDC (News - Alert) report where spending on telecommunications as a whole in New Zealand dropped.

The market there fell in terms of spending from 2.5 percent to $4.92 billion in the year ending December 31, 2013. The report also highlighted a shift to over-the-top applications, including WhatsApp and Skype (News - Alert). Given that voice and telephony business in the enterprise space is very mature, flat growth or even a decline is not unexpected, according to William. After all, it’s no longer just about voice as other applications are gaining in importance.

A shift in decision making is also influencing the push to the cloud. IT decision makers are thinking about shifting away from on-premise solutions to hosted offerings, which is extending the sales cycle. When looking at the cloud, these decision makers are also assessing how UC will operate well when accessed from multiple devices. This means the focus is not just on voice, but also on email, video, chat and more.

Multi-year contracts are also declining in popularity as companies no longer want to pay for high upfront investments and increasingly demand flexible deployment models. Economic conditions in recent years have also played a part as companies are protecting their spend and looking toward long-term value. The ability to scale solutions up or down has helped to drive attention to the VoIP switch, while streamlining voice and data remain important benefits.

“Besides the upfront costs of purchasing the necessary hardware and software licenses for an application, on-going maintenance and support is a significant part of the overall cost of ownership.

“In many cases the on-going cost of maintenance often exceeds the initial upfront cost of purchasing an application over a three to five year period. This is particularly evident in large and complex deployments,” William says in TechDay.

Complexities can be avoided, however, if you do your homework. Quality providers will focus on deployment, scalability, flexibility, streamlined costs and long-term value. If you’re ready to implement the VoIP switch, insist on a provider that meets your expectations in each of these key areas.