VoIP in Business: The View from 2006

Small and medium-sized businesses are frequently slow to adopt new technology because of the cost, manpower and lengthy deployment cycles that can be involved, but Internet telephony is one technology that deserves serious consideration for two related reasons.

First, with the advent of e-mail and other services that simplify distance communication, as well as the globalization of the economy, an increasing number of SMBs have multiple offices in different cities and/or conduct business abroad. The need to stay in touch can drive telecommunications expenses and associated landline/cellular cost tracking into the stratosphere, whether it’s sales or support groups traveling in Asia or Europe, or coordinating meetings between satellite offices.

Second, Voice over Internet Protocol (VoIP) technology offers the potential for slashing those phone bills and simplifying the administrative overhead to a degree that was never before possible — in some cases without the time and expense required for projects such as rolling out new enterprise software.

Saving With Skype

The leading provider of VoIP services is Skype, an eBay subsidiary that is one of the fastest growing Internet companies in the world. Skype dominates the VoIP landscape, claiming upwards of 113 million registered users. Other providers including net2phone, Vonage, Yahoo and EarthLink have less than 10 million users combined.

One of the reasons for Skype’s success is that it has no sign-up or monthly access fees. Another, of course, is cost. Calls are free between Skype users and typically about 2 US cents per minute to non-Skype users, even if they are located overseas.

Skype also offers instant messaging, conference calling, file transfer capabilities, business-grade sound quality, end-to-end encryption, seamless firewall traversal, and other features that make it attractive for both business and consumer use. The size of the network also makes it a compelling choice because more users mean more free calls.

Nevertheless, only about one-quarter of Skype callers are believed to be business users, and most of those can be assumed to be individual users who have downloaded the Skype client to their notebook computers, rather than company-wide adoptions providing maximum cost and efficiency benefits.

Connecting to the PBX

A main cause of the lag in VoIP adoption at the business level has been an inability to connect Skype to the office PBX. A traditional time division multiplexed PBX cannot route calls to and from the Internet, and even IP-PBX and IP-enabled PBXs cannot typically support Skype because they use a different communications protocol.

Without connectivity to the PBX and central control over Skype accounts, inbound Skype callers need a different Skype number for each employee, and each user is responsible for setting up and continually reloading a SkypeOut account to cover the cost of calls to non-Skype users. That makes it difficult to track all SkypeOut spending in a company.

Another barrier has been the need to use a PC and a headset for Skype calls, requiring users to switch between their desk phones and their headsets, depending on the call. This is not only cumbersome but also uncomfortable for users accustomed to dialing and talking on conventional handsets.

Making the Switch

Inevitably, technology vendors have jumped into the fray to solve these and other problems. One solution that has emerged is a gateway that can be connected to an existing PBX system in about an hour and handle up to eight Skype calls simultaneously. It works with users’ regular desktop phones, eliminating the need to use headsets or special VoIP phones for Internet calls, and provides a single point for provisioning and managing Skype with no need to install the Skype client software on every user’s desktop.

This kind of solution can pay for itself in four months, on average, depending on call volumes and pre-VoIP telecommunications rates.

Skype, of course is not the only VoIP game in town. Any business that is thinking of switching would do well to investigate all alternatives. The important thing, however, is to get the VoIP issue on your calendar. Given the potential impact on your bottom line, adopting VoIP can be a home run.