Unified Communications

Gaining a Competitive Edge with Hosted VoIP

By TMCnet Special Guest
Paul Marra
  |  November 04, 2013

When a major commercial real-estate company in the Midwest recently moved from its headquarters to a nearby location, it was eager to leave the phone system behind. At the old location, employees dealt with constant static on the line, not to mention dropped calls. Worse yet, the entire service would routinely crash, causing no less than 10 minutes of downtime every month.

True, 10 minutes a month amounts to just a couple minutes total within an average work week. But, for a property company that oversees millions of square feet of commercial property, the volume of dropped calls and/or network crashes often disrupted important business communications. When the system went down, all incoming calls automatically defaulted to the cell phone of the office manager, who doubled as the receptionist. So she’d have to literally run around the floor, relaying messages to employees.

Fortunately, this company has found a better way, by switching from a traditional, on-premises system to a hosted voice solution. It’s a move businesses are making for a variety of reasons, including cost savings and improved functionality. It also enables IT staff/departments to offload a great deal of tasks related to voice and data operations, as the hosted model transfers this burden to the telecom provider.

This remains key, as IT is playing an increasing role in business operations, as opposed to being relegated to the role of a less strategic keep the buses running on time department which ensures all the tech stuff works right. In fact, nearly nine of 10 IT professionals meet at least once a month with executive leaders from their organization, according to research from Cisco. However, these IT pros are struggling with reduced staffing due to continued fallout from the most recent recession, and their budgets are often either stagnant or shrinking. Thus, they’re advising those leaders about voice and data solutions that allow them to buy better, instead of more.

As companies are finding, this is where hosted VoIP comes in: VoIP/unified communications revenues now total an estimated $63 billion, a figure that will double by 2016, according to a forecast from Infonetics (News - Alert) Research. With demand rising for hybrid solutions featuring enterprise cloud-based services, VoIP and UC revenue is growing 17 percent annually, Infonetics reports. By the end of 2013, there will be 288 million mobile VoIP users, according to In-Stat (News - Alert), another market-research firm.

This should continue to surge, given the rise of mobile-device dependence and bring your own device acceptance. The number of mobile employees will reach 1.2 billion by the end of the year, reports IDC (News - Alert), and in the U.S., they’ll account for three-quarters of the workforce. And four of five adults use at least one personally owned electronic device for their jobs, according to Harris Interactive.

Multiple Benefits Abound

For companies, hybrid voice solutions cover a wide range of divergent needs. Previously, multi-site enterprises paid dearly for voice, especially because they had to cover the expense of idle lines and trunks. With a hybrid model that supports multiple handoff types, they can get SIP or PRI trunking for the headquarters and branch offices, and then hosted VoIP seats for remote workers and satellite offices. This opens up the opportunity for consolidation and other streamlining/cost-saving measures. Through call capacity sharing, a single corporate unit – such as a data center – can share capacity with another data center supplying a similar function within the organization.

Hosted voice solutions integrate Internet access and voice on a single-access circuit. They take advantage of unlimited local and domestic long distance, greatly reducing expenses. To offset initial start-up investment, providers will kick in free phones or phone rentals. Given that the monthly fee covers everything – including administration on the part of the provider – customers save 20 percent on up-front expenses in switching, and then 50 percent off of their monthly bill.

The stakes are too high to cling to outdated legacy models: For a typical, multi-site business, a 50 percent reduction in telecom spending can result in substantial savings every single month enterprise-wide. We know a housing-assistance non-profit that is saving up to $800 per location every month after transitioning to hosted voice. When you multiply those savings by more than 300 locations, the monthly savings quickly add up to well into the six figures.

Budget-Minded Breakdown

How exactly does hosted VoIP save so much money and (for those overworked IT staffers) time? VoIP solutions like SIP can emulate legacy handoffs, like PRI and analog lines that can leverage existing PBX (News - Alert) equipment, which further eliminates unnecessary capital expense. Working with a single provider across all locations also allows businesses to centralize IT management and simplify administration, documentation and training. This helps them take full advantage of the wealth of features that hosted VoIP allows.

Every day, IT innovators are coming up with new ways to offer mobile-friendly products and functionality to boost productivity, efficiency and overall performance. This includes audio conferencing, point-to-point video and sophisticated smartphone integration. It’s easy now to program routing so users appear to be phoning from their regular, in-office line with that number displayed, when they’re really dialing from any one of a number of personal mobile devices they use for work. (That’s important. To cite one of many examples, sales team members could lose potential customer opportunities if prospects ignore incoming calls because the phone exchange on their screen looks like an unfamiliar, personal number, as opposed to a business one with which they’re acquainted.)

With visual voicemail and transcription functionality, employees can see all of their voice messages in an e-mail inbox and no longer spend time dialing in and inputting a bunch of pass codes to get them, or view voicemails while they’re tied up on back-to-back conference calls. (And you can even send fax messages to the e-mail inbox, for customers still using the fax machine.)

Visual voicemail has worked out great for that real-estate firm in the Midwest, particularly for regional managers who travel all the time. They used to dial into voicemail, and the old system would cause delays in getting urgent messages about property matters. Through visual voicemail, voicemails are transcribed and immediately sent to voicemail so they can be viewed on any device. If they’re already on an important call, they don’t have to end the conversation to get incoming messages. If there’s important information in those voicemails – like a property address, phone number, bid price, etc. – they don’t need to jot it down on paper, since it’s already transcribed.

All of the great features in the world don’t amount to much of anything if the actual voice and data experience is shoddy. To ensure exceptional voice quality, voice traffic must be prioritized over a private network that guarantees quality of service. This means that voice traffic is prioritized over other application traffic, such as e-mail and file-sharing.

There are many VoIP providers to choose from, so it’s imperative to know what to look for. You don’t want your business-critical voice traffic sent across the public Internet or you’re sure to experience jitter and packet-loss issues. So how can you tell if a potential partner will support a quality experience? For starters, ask if they own their own private, secure MPLS-enabled network that supports bi-directional QoS for optimum voice quality.

By conducting appropriate vetting, VoIP calls will present a superior conversation experience, with a crystal-clear connection that doesn’t get dropped. Downtime due to provider-network crashes will be dramatically reduced. Because everything is based in the cloud, the system automatically initiates built-in, redundant business continuity if there’s a power blackout or some other sort of catastrophe in one vendor’s operations area.

General industry consensus is that traditional phone systems will go away as early as 2018. But we’re already seeing a huge exodus, as cloud-based communications are proving to serve as a strategic way to improved performance and gain a competitive edge.

Paul Marra (News - Alert) is director of product management for voice and UC at MegaPath (www.megapath.com).

Edited by Stefania Viscusi