Send in the cloud: Businesses are increasingly exploring the cost-savings potential of cloud-based VOIP phone systems

Many businesses have long been familiar with the benefits of VOIP (voice over Internet protocol) phone systems, particularly when it comes to their bottom line. Getting off the traditional phone grid can save companies thousands over the long haul, and more and more people are taking the plunge.

Now, say some VOIP providers, the ubiquitous and much-buzzed-about cloud makes switching an even more enticing prospect.

“It’s a little different now than it’s been in the past,” said Devin Renner, director of sales with Madison’s Simple Network Consulting. “VOIP has been around for quite a few years, but in the past you needed to actually purchase a phone server for the system. Now, that’s still a good system – eventually it pays for itself, and then, of course, you don’t have a phone bill anymore. But for a small or mid-sized business, the idea of dropping $20,000 on a new phone server, it’s just not feasible.

“With this, there are no upfront costs other than the phones themselves. ¦ You’re just transitioning to a cloud-based system, and you’re getting significantly more features, but you’re paying a fraction of the cost.”

Of course, it’s no secret in the business world that VOIP systems can save clients money. The question is, given the potential cost savings, why aren’t more businesses switching sooner rather than later?

Renner thinks it’s only a matter of time before people transition from landlines to VOIP systems the way consumers switched from VHS tapes to DVDs (and more and more, presumably, streaming video). That said, techno-phobic or simply inertia-bound business owners are still likely to have apprehensions – not all of them irrational.

Just a couple of weeks ago, Consumer Reports cautioned VOIP users to be prepared in the event of an emergency, which could bring down their Internet-based systems even as old-fashioned copper wire-based phone systems are functioning fine.

Renner acknowledges that that can be a problem, and that even something as mundane as a power outage could give customers pause. It’s a problem, he says, that VOIP providers have done their best to anticipate, however.

“If there’s a blizzard, a thunderstorm, the power goes out, and you can’t access your Internet, we’re going to have something in place that allows your calls to be automatically forwarded to your cell phone, so that way your clients can still call in and you’re not missing anything,” said Renner. “And by the time your system’s back up and running, your clients never miss a beat. They never know the difference.”

Staying secure

Another worry that many potential users of VOIP have – particularly a VOIP system that’s based in the nebulous and mysterious “cloud” – involves security. Older businesspeople probably kept everything they needed locked in a fireproof filing cabinet, while their sons and daughters had no problem keeping their data close to home on their desktops. What about the psychological barriers some people might encounter when trying to wrap their minds around the cloud concept?

“People ask, ‘How secure is the system?’” said Renner. “If somebody can hack my email account from the Internet, what’s to stop them from hacking the phone account and then checking all my voicemails from my clients? And if I’m an attorney’s office or a doctor’s office, I can’t have that information put out there. I have to secure it. So we have to make sure we’re selling a secure system that has security systems in place, is protected by various firewalls.

“So we need to abate those fears for our clients, and we need to make sure that we do that right off the bat.”

Renner says that clients really shouldn’t be any more afraid of a cloud-based VOIP system than of any other computer system they’re running. Then again, there will always be some people with reservations.

“We do have the issue of protection come up a lot, but these are from the same people who have a network in place and are already using the Internet if not the cloud, so offering the same sort of protection that they’re already at least vaguely familiar with seems to help with that,” said Renner. “You always have people who will sort of cling to what they’re used to and what’s familiar to them vs. changing something, even if it makes sense for them to make that transition.”

Seeing the future

Right now, says Renner, VOIP is especially attractive to businesses with employees who are spread out geographically.

“We’re seeing it used more so by businesses that have multiple offices,” said Renner. “From what we’ve seen, that makes the most sense because if I own a business and I have five or six different locations around the area, I can set up a central phone number for my customers to call, and I can have them press 1 to talk to location A, 2 for B, 3 for C, and so on.

“This allows them to sort of centralize their communications through one point, so rather than a customer calling one location when they need to call another, having one central system, one virtual assistant that can direct calls depending on what the customer needs, it seems to make more sense in a situation like that where you’re spread out over a large geographic area, but you need to make that simpler for your customers.”

Of course, can’t-miss technologies are more vulnerable than most products are to the disruptive power of Nassim Nicholas Taleb’s famous black swans, but as Renner sees it, if all goes as planned, cloud-based VOIP systems will soon come to dominate the market.

“I firmly believe that you’ll see that kind of transition within the next three years, five years, somewhere in there,” said Renner. “I would be strongly leaning to close to three years. It just makes so much more sense, it’s so much more cost-effective, and it just adds so many different things that you’re not able to get on a traditional phone system. And the more people get set up on this sort of thing and the more renowned it becomes, I think the more businesses you’ll see that will want to jump on this.”

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