VoIP (Voice over Internet Protocol) is simply the transmission of voice traffic over IP–based networks, such as the Internet. The Internet Protocol (IP) was originally designed for data networking. The success of IP in becoming a world standard for data has led to its adaption for voice networking.
Protocols which are used to carry voice signals over the IP network are
commonly referred to as Voice over IP or VoIP protocols. They may be
viewed as commercial realizations of the experimental Network Voice
Protocol (1973) invented for the ARPANET.ce providers. Some cost
savings are due to utilizing a single network to carry voice and data,
especially where users have existing underutilized network capacity
they can use for VoIP at no additional cost. VoIP to VoIP phone calls
on any provider are typically free, while VoIP to PSTN calls generally
costs the VoIP user.
1. VoIP Phone Systems Introduction
Voice over the Internet commonly
known as VoIP (Voice over Internet Protocol) represents the latest in
phone system technology. With it, regular voice calls are sent over a
computer network instead of traditional phone lines. VoIP has been
touted as "coming soon" since the first PC-to-PC telephony applications
were introduced in 1995. In recent years the audio quality has improved
drastically, technology has gotten cheaper, and business adoption has
started to spike. According to industry analysts Frost & Sullivan,
worldwide revenues for IP PBXs (industry terminology for a VoIP phone
system) are expected to grow from $1.96 billion in 2003 to $9.08
billion this year There are two basic varieties of VoIP. In its
simplest form, VoIP requires a regular phone, an adapter, broadband
Internet service, and a subscription to a VoIP service. When you place
a call, it is sent over the Internet as data until it nears the
recipient's destination. Then the call is translated back into a more
traditional format and completes the trip over standard phone lines.
Also known as Internet telephony, this allows for extremely cheap
long-distance and international calls. This Buyer's Guide covers only
VoIP phone systems - equipment installed at your business that routes
internal calls over your computer network. With VoIP, you can unite
multiple offices on a single phone system. No matter how remote the
locations, a VoIP phone system can completely eliminate long-distance
calling charges between them. However, it does not replace your
existing phone service to the outside world. Today you can purchase
either "pure" IP systems that have evolved from the developments of IT
companies like Cisco or converged solutions that have been developed by
the leading manufacturers of telephone systems and allow you to use
both the legacy networks of the telephone Carriers (e.g. PSTN, ISDN...)
while also managing voice and data applications on the one network
using IP technology. In this Buyer's Guide I will refer to both
technologies as VoIP phone systems or IP PABX's although traditional
telephone system dealers tend to sell and service the converged
solutions while data resellers sell and service pure IP systems. VoIP
phone systems can work for the smallest offices and the largest
enterprises. IP PABXs are replacing traditional phone systems for
medium to large customers as pricing is similar and benefits to these
customers is significant, With prices continuing to fall, in the next
couple of years IP PABX's and IP key systems will be the prime offering
for smaller customers as well .
2. How does Voice Over IP Phone System Work?
The premise behind VoIP is fairly straightforward. Instead of using
"circuit-switched" technology, where a dedicated path from caller to
receiver is reserved for their entire conversation, VoIP phone systems
treat voices as data, turning your words into tiny packets of
information that are sent over data networks. As these packets arrive
at the other end of the call, the data is turned back into audio. To
set up a business VoIP system, you need several components. A central
device manages the calls like the central controller used in
traditional phone systems. This can be a dedicated piece of hardware
such as an IP PABX, a regular PABX with specific IP cards, or a server
running specialized software. You will also need phones and a data
network. In some cases, you may be able to use your existing digital
phones and computer network, although you may need to upgrade some of
your network hardware to deliver the Quality of Service necessary for
high quality voice calls. Depending on your setup, internal calls are
routed over your existing phone network or your computer network. Calls
within the same office will typically be conveyed over your phone
network, while calls to other company locations get routed over your
computer network. Calls to external phone numbers get sent through the
network to a gateway, which connects to the public telephone network.
All of your calls connect seamlessly to any phone user - there are no
compatibility issues to worry about.
3. VoIP or Legacy Phone System?
The buzz around VoIP phone systems has been enough that many businesses
are diving in without really understanding their benefits. Contrary to
the assumption many potential buyers start with, a VoIP installation is
not a guaranteed way to save money. And unless you have the specific
requirements discussed later, the new features alone of IP phone
systems are not reason enough to upgrade. However, there are some
specific situations where VoIP can make an immediate positive impact on
your business. If your company has multiple locations - branches,
telecommuters, remote sales offices - that are already connected to a
company Local Area Network (LAN) or Wide Area Network (WAN), you are a
prime candidate for a VoIP system. You can share the full features of
your phone system across all your locations. In addition, even if you
have one office in Melbourne and one in Perth, VoIP allows calls
between them via extension dialing, making it a zero cost call. For
businesses with hefty monthly long distance charges due to calls
between locations, that can be a very attractive reason to upgrade. A
VoIP phone system can also save money as you are setting up a new
office - you will not have to run separate cabling for your phone
system. However, if you are setting up a new data network anyway,
adding a parallel voice network at the same time is relatively cheap so
the cost savings here might not be as large as you expect. In many
cases, the best solution will be a converged IP system that uses
existing phone wires within the main office and VoIP for calls between
locations. While converged systems support IP handsets, sticking with
the phone system's digital handsets internally will save you money, as
well as increasing the overall reliability of your phone system.
Vendors can also set up systems that use only traditional lines and
extensions at first, but support later expansion to VoIP.
4. Features and Benefits of a VoIP Phone System
The single biggest advantage of a VoIP Phone System is for businesses
with multiple locations. With VoIP phone systems, any and all offices
on a LAN or WAN can get the benefits of having a common office phone
system, including extension dialing, seamless call transfers, and other
features. In addition to making it easier to communicate, this sharing
of features can enhance collaboration as employees at different
locations can truly feel like they are part of the same organization.
Plus, if they are on the company network, the phone calls are free -
even if your offices are located thousands of miles apart. Simply
looking at your current phone bill for calls between far-flung offices
can give you an idea of how much you can save. There are other cost
savings that stem from the streamlined network infrastructure and
improved administration. For network administrators, VoIP systems mean
they only have one network to maintain instead of two. There is still
separate phone system hardware to maintain - but only one network. The
Move, Add, Change (MAC) process also is greatly simplified, because
almost all VoIP systems are configurable through a web interface that
can be managed by the administrator. This means lower ongoing costs --
you will not need to call your vendor for every relocation of an
internal phone or change in call diversions or other simple
administrative change in your phone system . And because multiple
offices are seamlessly connected, they can share a single receptionist,
auto-attendant, and voice mail system. Another significant benefit is
for employees on the go - the classic ‘Road Warriors". If your remote
users connect to the company network via a Virtual Private Network
(VPN), a VoIP phone system allows them to make phone calls from the
road at no extra charge. One salesperson on an extended trip can save
hundreds of dollars in cell phone or hotel long-distance charges. All
the user needs is a "soft phone," (software that lets a laptop function
as an IP phone), a PC microphone, and speakers. Other familiar and
essential phone system features like caller ID, call forwarding,
simultaneous ringing across multiple phones, and other features you
would find in traditional phone systems are available in most VoIP
systems. VoIP phone systems can also support advanced Computer
Telephony Integration (CTI) applications, such as call center
management.
5. VoIP Phone Systems Potential Drawbacks
The two main
drawbacks to VoIP systems are the limitations of your company's
internal data network for high quality voice traffic and the generally
poorer reliability of data networks compared to legacy voice networks. A. Internal Data Network Limitations
One challenge to maintaining call quality is bandwidth required for
high quality sound. The technology to compress audio and to reconstruct
it has been improved to the point where VoIP sound quality over a
high-bandwidth connection is as good as or better than that of regular
phones. However some networks that are fine for data are not up to the
demands of VoIP. Computer networks are designed to handle data that is
not time sensitive like voice. Data packets may arrive out of order or
even lost, but in most cases the data being sent can easily be
reconstructed before it is needed. For voice conversations, each packet
of sound has to arrive in the correct order because they are being sent
in real time - and if packets are lost or out of the correct sequence,
the conversation sounds distorted, choppy, or falls off all together.
This is why VoIP services that rely on the Internet to transmit calls
can have uneven voice quality. If your company is routing calls over
its private data network, then subject to the bandwidth available for
the voice traffic then you can generally avoid of this potential
problem with voice quality. The expensive frame relay networks are
ideal for voice, but standard Ethernet networks that have been
dimensioned to accommodate the voice traffic and are supported by
Quality of Service (QoS) applications are also excellent for voice. QoS
maintains a dedicated amount of bandwidth for voice calls by giving
voice data a higher priority as it is trafficked through the network.
If there is network congestion, VoIP data is routed through first so
call quality does not suffer. QoS applications are built in to some
VoIP systems, as well as some routers. They can also be purchased
separately as upgrades. If you have a WAN that routes data between
sites over the Internet, you cannot control the packet priority and
therefore cannot guarantee voice quality. This set up is unusual with
most larger companies using VPN's (Virtual Private Networks) provided
by carriers to deliver data between the major company offices B. Outages
Unlike regular phone systems that get set up and basically forgotten,
VoIP systems require more attention. Like any software application,
your VoIP server will require occasional upgrades and
maintenance.Company data networks also tend to go down regularly
bringing the IP PABX and all communications with the outside world down
as well. Additional redundancy may be required to be built into your
data network to safeguard your company's voice communications. Power
problems can also be an issue with VoIP phone systems. Most legacy
telephone systems have options to keep the system working in the case
of a power outage. This can be as simple as having a small number of
power fail telephones to keep limited contact with the outside world in
the event of a power failure or else a battery back up or UPS
arrangement o keep the system working for a defined time period in a
blackout. As most VoIP phones need to be plugged into a power socket to
work, unless you have a strategy to keep all the power to the site up
(e.g. a generator) you will be off the air for both voice and data for
the duration of the power outage. Converged IP PABX's with a mix of
digital and IP phones have an advantage over pure IP systems in a power
blackout as if there is a system in place to keep their PABX running,
then all the digital phones within the main office will continue to
operate even if the data network is unavailable.
6. How to buy your VoIP Phone System
The rapidly maturing business VoIP phone system industry means that
there are many manufacturers with feature-rich systems that may be
enticing to small firms. A. Sales channels As for traditional telephone
systems, buying a VoIP phone system from a local reseller or dealer is
the best choice for most businesses. However data resellers tend to
offer only the pure IP phone systems such as those provided by Cisco
while the telephone dealers usually restrict themselves to the
converged solutions. Checking that the dealer or data reseller has
manufacturer support is particularly important -- this can be critical
as upgrades are released or problems crop up. If you strongly prefer a
pure IP phone system, we recommend you get a quote for a converged IP
PABX or key system as this will probably meet your needs at a lower
cost. Also watch out for vendors that simply add a VoIP system to your
existing network whether or not it is fully ready to support voice
traffic. They may later charge you for upgrades if you decide the call
quality falls short of your expectations. Make sure you get a thorough
analysis of your current network and the impact VoIP will have on it to
get a true sense for your phone system costs. Whatever you do, do not
be tempted to do it yourself - setting up and maintaining a business
phone system of any type requires specific expertise. There are many
dealers, resellers and service firms that customize, install, and
maintain VoIP phone systems - use our free quoting service to find two
or three in your area to begin the purchase process. B. Choosing a system
Once you have decided that VoIP is right for you, the next step is to
determine what of your existing telecom equipment you can keep. Many
PABXs can be IP-enabled with software upgrades and minor hardware
additions, and you may be able to use digital phones you already own.
The potential cost savings are significant, and you can also increase
the overall reliability of your phone system. When comparing phone
systems, make sure you investigate the details carefully. Many systems
say they include "everything" but may not include the specific features
you require. Exactly what makes up a "complete" system varies from
vendor to vendor, so be sure you are comparing equivalent systems. You
may also want to learn whether the phone systems are built on open
standards. While all VoIP systems use the industry standard Internet
Protocol (the "IP" in VoIP) to route calls, some use proprietary
technology for administration or integration features. Having a system
run entirely on open standards can allow for greater flexibility in
integration and customization. However, you may not be as concerned
about flexibility as long as the features and costs match your
requirements. The technology used in a particular system may impact
whether you can leverage your existing equipment, so be sure to inquire
about compatibility issues. Lastly, remember that some common business
devices require analog phone lines - notably fax machines, but also
credit card processors, some security systems, and other devices. Make
sure your vendor knows and accommodates these types of uses when
planning your phone system.
7. VoIP Phone System Buying Tips
Evaluate
the potential savings of toll-free calling between all locations. If it
is only $200/month, think twice before making such serious investment.
Do not buy just for the sake of having the latest technology. Plan for
the future. The cost difference between including extra capacity at the
beginning of a project and adding more hardware later is significant -
build in room for growth. Detailed analysis of impact of VoIP on your
Data Network. This is critical in determining the actual cost of
upgrading to your new VoIP system Investigate your vendor. Just as for
traditional phone systems, the most important consideration in choosing
a IP PABX dealer or reseller is the stability of the business and their
product expertise. On purchase of a telephone system, you are entering
into a long term business relationship with the dealer or reseller that
with ongoing service and add ons to the system as you grow and your
business needs change, should extend for the life of your new telephone
system number and perhaps the life of your next system! So spend some
time looking at the dealer's operations, company structure and history
to make sure they are right for you. See Telephone Systems Buyers Guide
- Purchase Process
VoIP
