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VoIP - The Cost Benefit Analysis

Updated on August 21, 2015

Cost - Not the Only Factor

One of the biggest – and perhaps the most compelling – selling points for VoIP is the fact that it is much cheaper when compared to traditional phone services, especially for advanced features that were hitherto restricted to large businesses. Unfortunately many businesses then assume that the best vendor is the one that provides VoIP for the lowest cost and end up regretting that choice later.

There are numerous other factors that play a role when trying to select the best business VoIP service suitable for a particular business such as customer service, technical support, hardware compatibility, bandwidth capabilities etc. On the other hand, VoIP is more than just about the – often substantial – cost savings. Hosted VoIP service typically provides the best cost-benefit ratio for a given set of features when compared to analog service or even on premise SIP trunking.

Rather than looking for the cheapest VoIP solution, managers should identify the features that they require for the business and then compare the providers who can offer that service. VoIP provides the option of only paying for resources that were consumed and so businesses should be careful not to go overboard with signing up for extra features that they don’t really need.

Do you Really Need All those Features?

To illustrate, VoIP vendors will often advertise that the technology can allow small businesses to compete successfully with multinational corporations by presenting a professional image to customers who call on the phone. However, not every small business benefits by using an auto attendant. For instance a small neighborhood bakery may actually alienate its clientele who would rather wait on hold to speak with an employee.

Rather than focusing on just cost (to the exclusion of every other benefit), an enterprise should evaluate the usefulness of VoIP through a cost-benefit analysis. In general, a business will be able to save significant monthly expense by switching to a hosted VoIP solution for the same set of features as they were used to with analog services. On the other hand, if the company is more interested in improving productivity and efficiency, VoIP will be able to provide more advanced functionality at the same price.

Though switching over to VoIP does require a certain amount of planning and setting up the requisite infrastructure (fast and high quality Internet connections, compatible hardware etc.), the technology enables businesses to be more flexible and agile. VoIP looks set to be the future of telecommunication and there is no better time to upgrade than the present.


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