In a communications world full of buzz words it’s easy to fall into the trap of assuming something must be the best for your company without truly understanding the total picture.  This is especially true when all you are hearing about references the buzz.  Hosted VoIP fits…

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In a communications world full of buzz words it’s easy to fall into the trap of assuming something must be the best for your company without truly understanding the total picture.  This is especially true when all you are hearing about references the buzz.  Hosted VoIP fits this buzz trap category.

First, what is Hosted VoIP (Voice over Internet Protocol)? 

In a nutshell, your telephone system is located in some remote provider’s facility which connects to your business via high speed Internet connections.  So the telephone set sitting on your desk can make and receive calls plus gets its features and voice mail from your (remote) Hosted VoIP provider.

Although Hosted VoIP providers charge in many different ways, generally a monthly fee per telephone connection and/or number is charged.  This fee includes local calling and sometimes long distance or an attractive per minute charge for long distance and international calling.  The Internet service, the routers and switches plus the telephone set you have on your desk are generally outside the scope of the Hosted VoIP provider’s responsibility.  Another way of understanding this arrangement could be summarized as: The brain of your telephone system isn’t in your office and is not controlled by you.
Why the buzz?  Hosted VoIP has some advantages that may fit well with your business needs.  They include:

  •  Less equipment installed in your office means a lower startup cost.
  • The Hosted VoIP provider is responsible for maintaining your system – not you.
  • You can add company telephones anywhere via high speed Internet connectivity.
  • Technology enhancements are generally available should your company need them at any time.  These enhancements may increase your monthly fees but not until you elect to use them.

So if the cost is less and the features and capabilities are as enhanced as you want them to be why not go with the buzz?  Is there a catch?

Some things to consider:

  1. Remember, everything is happening via your Internet connection.  If your current Internet service is unreliable, either don’t go with Hosted VoIP or get reliable Internet service first.  While it’s true that Internet service is becoming more and more reliable, a Hosted VoIP provider cannot make poor Internet service better.  They don’t control your Internet service. What happens if your Internet service goes down?  The short answer is: Your business will not be able to make or receive telephone calls.
  2. Where is this remote Hosted VoIP company?  They are almost assuredly not local to your business area.  This may not be significant unless things start happening that make you want to speak with ‘someone’ face to face and all you can get is a recording saying your business is important and you’ll be helped as soon as an agent becomes available.
  3. Is their reputation solid?  Do you know any other business using them or did you find them on the web and they looked and sounded big and reliable?  Was the monthly cost just too good to ignore?  A one-man company on the web can seem universal – just check them out.
  4. How quickly will they be able to respond to your business needs?  Again, do you know someone using them?  Your business is too important to throw your total trust to an unknown.
  5. Will their rates increase every year or sooner?  You don’t control these rates so make sure you ask and understand your Hosted VoIP provider’s platform.  If a long term contract for service is offered, make sure to clearly understand how termination charges are applied prior to the normal contract termination date.
  6. Where does the Hosted VoIP provider’s responsibility stop and yours begin?  If your telephone call quality is equivalent to a horrible cell phone connection, who’s responsible for fixing it?  Will you lose business because of issues caused by any grey areas of responsibility?

Depending on your business agenda there are as many pros as there are cons in considering Hosted VoIP.

The communications industry at large is going through a process where both large and small companies are trying to gain as much control of the Hosted VoIP market as possible.  Why?  Those companies that are successful in this attempt hope that they will be in a position to reap large revenue streams by controlling your business communication needs.  If you make a solid decision for Hosted VoIP you may be completely delighted with your provider.  If your provider of choice finds they cannot handle Hosted VoIP requirements, gets bought out by some other company or goes out of business you may not be delighted with your choice.

We can look at lots of historical examples to see how the communications industry may unfold.  Does anyone remember Ma Bell?  When divestiture occurred in 1984 the industry mushroomed with companies wanting to get in on the opportunity to get large revenue streams.  The operating companies (Verizon, Bell South, etc.) were not allowed to sell telephone equipment, only telephone service (dial tone).  Many businesses were successful and are still going strong.  Many more went out of business leaving their customers to find alternate providers.  Today many operating companies are offering hosted services.  Will we find ourselves going back to the pre 1984 days of Ma Bell – ‘the one and only Phone Company’?  Not likely, but the pendulum does appear to be swinging toward that direction.

Should you go with Hosted VoIP?  Maybe.  If you don’t go that way what choices do you have?  Will your company be left behind in the dust?  Click here to check out my next Digital IP Enabled PBX and IP PBX column.  You just might be glad you did.

Posted by Sid Cervarich, Vice President of Sales at HRCT.  Sid has over 30 years of sales and implementation experience exclusively within the greater Hampton Roads area.  His range of experience includes governmental as well as commercial solutions.  His preference is to provide a consultative teamwork approach to solving customer requirements.

Hampton Roads Communication Technologies (HRCT) provides quality business telecommunications solutions, like Hosted VoIP to companies and organizations throughout the United States, Mid-Atlantic and the Hampton Roads Virginia cities of Virginia Beach, Chesapeake, Norfolk, Portsmouth, Suffolk, Newport News and Hampton, north into Williamsburg and south into the Outer Banks of North Carolina. HRCT keeps your company connected.

Call today. (757) 399-3350