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Transforming VoIP communications into a cost center

Updated on September 21, 2011

Old Business Communications Costs

One of the most powerful financial tools available to a company is to introduce the idea of cost centers into its accounting practices. There are many functions which a business requires in order to operate efficiently but don't contribute directly to any revenue on their own. Accounting and HR are just two examples. Classifying these departments as cost centers means that firms can keep an eye on just how much resources these areas consume while still being able to perform their functions.

But in order to do this, the costs must be clearly defined and measurable. The communications infrastructure of a business is also a cost center. It doesn't generate any revenue by itself, but is an important support service. You would think that calculating the costs of communications would be easy to predict, but that hasn't proven to be the case. While shopping around for a telephone system, many companies are simply unaware of hidden costs such as proprietary systems and non transparent billing. This makes it impossible to get an accurate picture of costs with any certainty - at least not until now.

The introduction of VoIP in the market has shaken up the way things are done. VoIP firms are famous for their transparency and itemized billing. In addition, most firms now offer standardized systems which allow anyone with the proper technical expertise to administer the systems.

VoIP PBX Costs
VoIP PBX Costs

Standardized VoIP SIP Services

If a business decides to hire the services of an ITSP in the form of hosted PBX services, they can easily start treating VoIP as a cost center for several reasons. In the first place unlike regular telcos, VoIP firms are very open about their call rates. They're usually displayed prominently on their website with no hidden connection charges and itemized billing allows any firm to be able to verify the sources of any costs. This has happened because of the large amount of competition amongst VoIP firms. The service has become commoditized and standardization has allowed people to switch their providers without too much of a hassle.

The second reason is that there are no hidden costs in the form of compatibility and technical know how. The standards are open and managing an SIP proxy server won't be your headache since that will be taken care of by your provider. Handling the switch to hosted PBX is easy and you'll need the same procedures no matter which provider you choose so it's a repeatable process. This allows a certain measure of certainty with respect to costs - it's something that no regular telecom provider can assure you. And that's just one more reason to choose VoIP.


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