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December 2006, Volume 9/ Number 12
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Hosted Services � A Logical Choice for Business

By Richard �Zippy� Grigonis


SMBs (small and medium-sized businesses) have watched the rise of IP Communications with both fascination and anxiety. On the one hand, they are intrigued by the possibility of saving money on phone calls and gaining access to new communications features, but on the other, they worry about the costs of installation and the expertise needed to maintain such IP-based phone systems. Fact is, for most SMBs, a �do-it-yourself� approach to IP Communications can lead to too many uncertain (not to mention economically unviable) scenarios.

SMBs can still participate in the IP Communications revolution, however, thanks to a bevy of sophisticated broadband-based service providers that have targeted this market segment and can make the migration to voice and video over IP easier than ever before. Smaller businesses can now inexpensively enjoy the same calling features normally found in the big PBX (News - Alert) phone systems of large enterprises, simply by contracting with a provider that hosts the technology off-site.

Indeed, offerings such as 8x8 (News - Alert)�s Packet8 Virtual Office service ( about/virtual_office.asp) are so affordable and easy-to-use that they make sense for residential as well as business customers.

�The TCO, or Total Cost of Ownership, is really the primary reason that people adopt a hosted model instead of a do-it-yourself model,� says 8x8�s Senior Director of Sales, David Immethun. �Also, �doing it yourself� can mean many different things, none of which are easy. You could go out and purchase a server and softswitch software, such as Asterisk (News - Alert), but then you end up having to become an expert on your own phone system. SMBs often don�t have people on staff who can be dedicated to such issues, so you could say the second reason not to go it alone is the ownership headaches, such as administration, education and upgrades. You could also try hiring a combination of integrators and installers to come into your business, install a system, then put a service contract in place around that, but then you lose a lot of the economic benefits and flexibility.�

Immethun beams, �Services such as Packet8 Virtual Office completely eliminate such headaches by offering a model that includes full PBX features with dial tone services, complete service support and furnishes customers with full administration privileges and controls. By removing the headaches, the day-to-day aspect of owning a phone system becomes Moves, Adds, and Changes. With the Packet8 Virtual Office, an Add, Move, or Change can be as simple as literally picking up a phone and moving it without ever making a single administrative change.�

Immethun elaborates: �For example, when 8x8 moved from one building across town to another, 110 people bagged their phones with their computers, threw them in their cars, showed up at work the next day, plugged them in, and the whole phone system was moved. There was no administrative person doing this for us. We did it. The plug-and-play ability of these devices is associated not with their IP addresses, but rather with their MAC [Media Access Control] addresses, which uniquely identifies each extension to the service on any network.�

�Companies often forget about the maintenance aspects of a phone system,� says Immethun. �A phone system often lasts seven to ten years, and, just like a car, it starts to break down over time, so the maintenance costs start to rise. Any a time you want to add a new feature, you typically have to upgrade the system�s software release. With a hosted model, such as Packet8�s, all new features added to the service are included and all of the maintenance is part of our service offering to the customer. It�s a compelling fact that we provide the customer with features, functionality and local and long distance calling. Compare that with the �normal� business phone system environment where you buy your phone lines from one company and you buy your phone system from somebody else, and you need an integrator to come in and write up a service contract to install the system and keep it maintained and keep the dial tone up.�

Today�s communications services, such as Packet8 Virtual Office, have targeted SMBs and have formulated a feature set that most companies will find extremely useful, such as One Number Access, Find Me/Follow Me, Voicemail-to-Email, etc.

�Probably the Number One feature that interests an SMB is multi-site support,� says 8x8�s Immethun. �Normally multi-site support is very expensive to buy and very complex to administer � especially when you add applications such as voicemail, an auto-attendant, or hunt groups. With our Packet8 Virtual Office, the location of the �site� is irrelevant. And whether you have ten sites with one person or just one site with ten people, from an administrative standpoint it�s exactly the same. We give you local and long distance from anywhere for anyone, without the barriers of a local dial tone plan. We�ll do it all for you; you have complete carte blanche control to administer these employees yourself, or we can accommodate a combination scenario of �we do some, you do the rest�.�

Packet8 offers a variety of service plans.

�In an extreme case, you can actually have no extensions and let the staff operate off of their cell phones, but to inbound callers it will sound as if you have a big phone system in an office,� says Immethun. �Our auto-attendant can have several IVR options, such as �Dial 1 for Sales�, �Dial 2 for Support�, and �Dial 3 to Dial-by-Name�. In actuality, what�s behind that is a virtual PBX with no physical hardware whatsoever, pointing to the individual cell phones. Yes, businesses can start, run, and flourish without brick and mortar to house their employees. After all, what could better support a booming virtual company than a virtual phone system?�

�You can also have a combination environment where your road warriors are always on their cell phones, and your other people are either situated in regional multiple offices or in home offices, with a physical handset,� says Immethun. �We give them access to extension dialing, music-on-hold, ring group capabilities, as well as access to the auto-attendant. Of course, we can also serve a full-blown company having extensions, virtual employees running around everywhere using cell phones, and virtual extensions that aren�t even connected to people, but are used instead for things such as playing prompts for driving directions or the latest sales promotions.�

Any way you look at it, services such as Packet8 Virtual Office will have an immense impact on businesses with staffs ranging from just a few people to more than 250. IT

Richard Grigonis is Executive Editor of TMC�s IP Communications Group.

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