Broadband and VoIP – The Explosion

VoIP is a hot topic in enterprise IT circles again. There are few businesses that aren’t considering the switch to VoIP sooner or later. Some companies are opting for cloud VoIP services while others are busy deploying their own SIP trunk solution. Whether it is new features, low prices or security concerns, VoIP related news is making headlines.

VoIP Technology – the Early Years

While the recent popularity of VoIP isn’t surprising by itself, it does bring up a question – why now? After all, VoIP is not exactly new. The technology has been around since the 1990s even if it was confined to niche circles in the beginning.

There are several reasons for the initial slow adoption of VoIP. One is that the technology was not robust or reliable enough for companies to trust. Consider the enterprise situation today. Most businesses use email, texting, video chat, instant messaging, and many other means of communication along with voice calls. In spite of the multitude of options, voice calling remains integral to business communication. Organizations historically relied even more on voice calling than they do today. To replace the reliable and trusted PSTN with untested technology was simply infeasible.

Another reason for the lack of high-speed Internet connections. VoIP relies on the data network to route voice calls. Although it is technically possible to make VoIP calls on slower connections, quality will inevitably suffer. While it may be acceptable for echoes, dropped calls, and missing words to occur during private conversations, businesses cannot tolerate poor quality voice calling. Combined with the lack of knowledge and awareness about the potential of this new technology, it is not surprising that businesses were hesitant to adopt it.

What Has Changed Recently?

The global economic downturn in 2006 had slowed down industry growth significantly. VoIP adoption had grown steadily over the past two decades, although it is enjoying renewed growth since 2015. There is one major reason for the astounding growth in recent years.

The Broadband Explosion

High-speed Internet connections have been around for a while. However, it wasn’t widely available or affordable to individuals and organizations. Without access to fast and inexpensive broadband Internet, organizations could not hope to deploy VoIP with any degree of success. High-speed Internet was not a necessary requirement for businesses. That is not to say that VoIP will not work with slower networks. However, it would have struggled with managing more users.

Small and medium-size businesses with a handful of users could not afford high-speed Internet necessary for VoIP. While larger organizations could afford to upgrade, not many were willing to gamble on the new technology. The situation has changed quite a bit in this decade. Today, no organization can dream of conducting business without access to the Internet. The widespread availability of high-speed fiber-optic connections has helped VoIP growth tremendously.

It has also opened up new markets for the industry. Hitherto confined to the developed nations, the broadband explosion in emerging markets has helped VoIP growth as well. With more businesses coming online in Asia, Africa, and other developing economies, growth is set to continue for a while. VoIP service providers have also improved their infrastructure to provide more robust features, high quality HD voice, support for multi user video conferencing etc. All of this makes the switch to VoIP inevitable for most enterprises. What was once dismissed as a luxury is now a necessity.

Other Factors Contributing to VoIP Growth

The availability of broadband Internet is not the only driver of VoIP adoption. Many enterprises VoIP as a stepping stone for more advanced systems like unified communication suites. Cloud services like SaaS, PaaS, and IaaS have gained prominence. VoIP is not the only cloud dependent enterprise service anymore. Upgrading to high-capacity and high-speed connections is no longer seen as an expense but an investment that will pay off in the near future.

Another reason is the popularity of remote working and telecommuting. Aided by cloud services and the proliferation of smart mobile devices, employees are no longer tethered to their desk. Some work from home, others work on the road and even more workers travel to client sites during business hours. Any such flexible working schedule cannot be supported by analog PSTN technology.

VoIP allows workers to forward calls on a schedule, ring multiple devices at once, send voicemail transcriptions to their email inbox, and so much more. Employees can reduce commute related frustrations. Organizations can cut back on business travel and replace face-to-face meetings with videoconferencing.

It should come as no surprise that businesses see significant savings in their monthly phone bills after switching to VoIP. But what’s remarkable is that the savings continue to add up in the long term as well. Given the current growth rates, it’s only a matter of time before VoIP completely replaces the existing PSTN infrastructure.