25th May 2010

VOIP which stands for Voice over Internet Protocol, basic refers to making phone calls over the internet using lines that previously only carried data not voice. By using data lines to carry voice there are some potential cost savings to be had over traditional phone lines. But this is not always the case.

One myth surrounding VOIP is that calls are free, this myth was created largely by the success of Skype which allows PC/MAC users to make free calls to other Skype users. This ability to make free calls to other users on the same VOIP system is not unique to Skype and is true of most VOIP providers. The reason why all VOIP calls are not all free is because as soon as you call to another voice user on another system/provider then a charge is made just like a normal phone call.

OK so you cannot get all your calls for free but you can make significant savings and you can do this in 3 ways.

• 1. Lower Installation costs
• 2. Lower Line rentals
• 3. Lower call costs

In a business most of us want to make hassle free calls using handsets and not have to worry about the cost of each call; we want to have the peace of mind that the "system" is choosing for me the cheapest way to make that call. This is why modern phone systems now allow us to put rules in place to makes those decisions for us. So a modern phone switch is the key to unlocking the cost saving.

Quality of VOIP calls has been an issue in the past, but modern system set-ups guard against these problems and you can configure systems to be as clear and as reliable as traditional systems.

The installation and line rental savings are greater for larger business, because you can replace expensive ISDN installations with a single broadband line that is enabled for multiple channels (SIP Trunks). Savings of up to 50% can be achieved here.

For savings of call costs you have to be careful and you need to both examine your bills and shop around for the best deal. It can be a good option to take advantage of GSM gateways to reduce the cost of you mobile call costs. The biggest savings will be for people who make large volumes of international calls to multiple locations. WARNING! Some VOIP calls can be more expensive that using a standard phone line. Time spent getting your call routing right will bring the biggest savings.

This is a very competitive market and you should make sure that the solution you are looking at is the best for your business, mistakes can be made and they can be costly. But ultimately when you get this right you can reduce your phone bills significantly and saving can be made of up to 90%. Would you like to pay just 10% of your current call costs? Typically savings are nearer 50%, either way it's worth a review of your system.