5 minute read |

What is a Business Phone System?

VoIP phone service background
VOIP | VoIP Services

Are you looking for a new business phone system? Or perhaps you want to replace an aging and outdated phone box in your office. Unfortunately, a bit of online research is enough to leave anyone confused. From VoIP, SIP, and IP-PBX to the cloud, it’s often difficult to understand the terms and the differences between them.

It’s even more exasperating since you would think there shouldn’t be so much confusion, a phone is a phone, right? How much of a difference could there be from one system to another? When it comes to a personal phone for individual use, you would be right. But a business phone system is so much more than a simple phone line.

What is a business phone system?

A telephone line, number, and system are very different things. To start, a telephone line refers to the physical wire connecting your phone to the rest of the network. A telephone number is a string of digits that identifies your phone on the network to others. Most households and individual users have 1 phone line and number.

Now consider the situation facing a small business or a large corporation. If you have 25 employees who need telephone access, you would need to buy 25 separate lines and numbers. What if you 25,000 workers? Imagine getting and managing all those lines!

This is where a business phone system comes in. It allows an organization to interconnect phone lines to form their own small system. This way, employees can share phone lines since everyone would not be using the phone at once. These phone systems also offer essential business functions like call transfer, call logging, and phone directories. With a business phone system, many employees can share a handful of telephone lines, even as everyone has their own telephone number.

Types of business phone systems

Phone technology has changed significantly since the turn of the century. Even in the age of landlines, businesses could choose from a variety of different systems to manage their phones. In 2020, companies can opt for a digital system that precisely suits their business needs and requirements.

Startups, entrepreneurs, and contractors
Startups, freelancers, and others who manage their own business may not need a full-fledged business phone system, especially if the company has only 1 or 2 employees. While they do need professional services like hold music, call transfer, or voicemail, they don’t need to manage multiple extensions and numbers.

As a result, startups and freelancers often use residential phone services as it fulfills most of their requirements. As the business grows, they can upgrade to a business-grade system.

Small and medium businesses
Once a business grows to 3 or more workers, you need a more sophisticated system. Before the launch of VoIP, businesses had to buy a Private Branch eXchange (PBX) and business services from an operator. These were expensive and unaffordable for many small business owners.

Today’s VoIP-based phone systems are much less expensive and are easily accessible to every business. Companies can choose to purchase their own IP-PBX (internet-based PBX) and SIP trunks to connect those systems. Alternatively, they can also purchase hosted phone services from an experienced third-party vendor. This option is perhaps the most popular amongst small and medium organizations today.

Large corporations
As a general rule of thumb, larger companies have the resources to purchase and maintain their own telephone systems. However, any large business would jump at the chance to use a more efficient and effective technology that is also less expensive. Quite a few organizations want to control their phones as it is a critical part of their communication system.

Purchasing and maintaining a quality business phone system is well within the budget for a large company. Hence many organizations use SIP trunks and IP-PBX systems to create their own on-premise digital phone system. As vendors improve their infrastructure and create more robust services, even larger companies are making the switch to hosted VoIP phone services.

As you can see, VoIP is the preferred choice for any business today. Whether you like to control your own system or want the no-hassle option of cloud services, landlines are no longer a viable option.

What can a VoIP business phone system do?

A VoIP business phone system is quite an upgrade from the older generation of telephone technology. In a nutshell, a VoIP system can do almost everything a landline can and quite a few more things that simply weren’t possible with old technology.

Consolidate your network
The first major upgrade is that a VoIP phone system doesn’t need a separate network for calls. It will convert human voice to digital packets that can be sent through the internet just like any other data (email, pictures, documents, etc.) This allows businesses to eliminate physical wires entirely. A robust data network and wifi where necessary is all you need to manage business communications – including voice, text, and video.

Reduce phone bills
Since VoIP systems use the internet, vendors don’t have to pay access charges for the traditional PSTN system. Providers don’t have to pay the costs to maintain a physical network. They pass these savings onto their clients instead. What this means for a business owner is that you don’t have to pay anything for a call that travels exclusively through the internet.

In effect, this means all internal calls by employees – regardless of where they are located – are totally free. International calls are much less expensive since you only pay for a portion of the call as it travels over the PSTN at some point. Although there are other costs associated with a VoIP phone system, most companies will see a dramatic reduction in their monthly phone bill after switching to VoIP.

No maintenance
Every business has it. Whether it is a single employee or a large department, you need someone to manage the phone system. With VoIP, that’s no longer the case. You don’t have to buy any equipment or maintain anything. Everything from security to hardware maintenance is taken care of by the provider. What’s more, you even get regular updates and new features delivered online without any downtime. Is it any wonder that businesses are upgrading to a VoIP business phone system in droves?

VoIP business phone system features

Online dashboard
A VoIP business phone system will manage all your inbound and outbound calls. You can set up and configure the system to suit your business needs through an online dashboard. The provider delivers all business phone services through your data network. It means you don’t have to wait for days to add a number, test a new feature, or make any other necessary change to the system.

Digital faxing and analog features
Even today, many businesses use fax machines to send important documents. VoIP systems offer digital faxing, eliminating the need for a separate fax machine in the office. Users can send and receive faxes in their email inbox, printing out any document only when it is needed. Many good VoIP services also support other legacy features such as access to the PSTN.

When VoIP systems first arrived on the scene, businesses hesitated to use them as they would lose access to emergency services. VoIP phone systems are location independent, which means users making calls could be located anywhere. While it offers a considerable business advantage, it is a drawback when it comes to emergency services.

Today’s VoIP services, however, provide E911 services. Users are required to provide an address (changing it when needed) so that emergency personnel can be directed to the right location.
Visual voicemail, auto-attendant, call management, etc.

Most reputed vendors offer a huge plethora of call routing and management features such as an auto-attendant, call transfer, multi-device ring, and so on. Some providers bundle features together and charge for upgrading to the next level. Others offer unlimited access to all features on a cost per user basis. You can select the option that’s right for your needs.

You can configure and even turn off these features through the dashboard, making it simple for anyone to administer the system effectively.

Unified communication
Perhaps the best part of a VoIP business phone system is that it provides a foundation for more sophisticated features. Businesses can bring all their disparate communication channels under one roof. Imagine a system that looks and works the exact same way everywhere – on a desktop or on mobile. Users don’t have to switch back and forth between multiple apps and windows.

VoIP business phone systems offer more than just voice. Use instant messaging, texting, video calls, group calls, virtual meetings, and even run training sessions for international teams. The options are endless when you opt for VoIP phone service.

The key to selecting the right service for you is not just about cost and features, though they are important considerations. Take care to select a vendor who will partner with you as your business grows and expands. Now that you know how VoIP can help your business, contact VoIPstudio for a free 30-day trial and prepare to be wowed!

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Thousands of businesses across the world trust VoIPstudio for all of their most vital business communications. Why not be the next?

Thousands of businesses across the world trust VoIPstudio for all of their most vital business communications. Why not be the next?

Start a free 30 day trial now, no credit card details are needed!