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Thursday, July 03, 2008

Ask Idealware: VOIP Phones for Small Organizations?

by Laura S. Quinn

Megan asks: We're considering one of those online/virtual phone systems. Regular phone systems are so pricey and if there's a VOIP option for multiple lines, voicemail, etc that's reliable, easy to setup and use, that would be great. Are these systems worth considering for a small organization? If so, what systems would you recommend?



Ron Zucker, with 2020 Vision, responds:


Are any nonprofits using VOIP phone systems? Yes, certainly. Some love them and swear by them. The availability of advanced phone services, including voice mail and "Find Me" phone routing at a very reasonable price, is certainly attractive. Does VOIP make sense for smaller nonprofits? That's harder.

One of the key considerations for VOIP is the reliability of the internet connection that you're using. If your internet connection goes down, so does your phones. If it blips out just for a second - which you wouldn't typically notice if you're just surfing the web - your VOIP phone call will be disconnected. For most home VOIP users, this is fine. If your phone is down for a couple of hours, or it disconnects, they'll call you back. If it's someone you really care about, they have your cell phone. But for business, that's typically not acceptable; you don't KNOW in advance who needs to find you (what if your phone's down on the day your big grant proposal is due?), and an unstable phone system is just plain unprofessional.

If that kind of reliability is important to you, to use VOIP you really need an internet connection with a Service Level Agreement (SLA) of at least 99.9% uptime (i.e. down less than two working hours per year -- 52 weeks/year minus 10 federal holidays times 40 hours/week = 2000 work hours/year). And most cable and affordable DSL internet services aren't willing to give you any SLA at all, let alone a 99.9% uptime commitment, or any arrangements for you if they fail. (Note: Some business DSL services will give you an SLA. You'll need to check it with your provider.)

So that would imply you likely need to have a T1 internet connection. A T1 comes with uptime guarantees and failover solutions - but at a cost, often between $350 to $650 per month.

On the other hand, a Plain Old Telephone Service (commonly abbreviated POTS) tends to be very reliable. And they're really not very expensive. At 2020 Vision, we spend $17/month for 2 lines that are local plus charged long distance, and $39 for two that are unlimited long distance. Incoming calls are routed to local lines first to keep the outgoing calls on the lines that include free long distance. Can you REALLY beat that by enough to justify the lower uptime of a VOIP line? Especially when you consider that you typically need to buy new physical phones when you switch to a VOIP line?

VOIP phone service is certainly worth investigating if you have a T1 connection already, or one makes sense for other reasons. Or if the reliability of your phone service is not a critical concern. But for a typical small organization, Plain Old Telephone Service is likely to be pretty hard to beat.

The Ask Idealware posts take on some of the questions that you send us at ask@idealware.org. Have other great options? Disagree with our answer? Help us out by entering your own answer as a comment below.

4 Comments:

Blogger Peter Campbell said...

This is really good information, but I not sure if Ron answered Megan's question. We use a service at Earthjustice called Virtual PBX. It's a web-based service that allows us, from any phone, to use outsourced PBX functions, like voicemail, auto-answer, etc. Our use is very limited - we have their cheapest plan with one line setup for the IT department's after hours support line, which is shared among a few people.

I've looked into using this service to support an office of ten or so people, and I found the price prohibitive in that scenario. I would only recommend it as a very short term solution.

You can buy a refurbished traditional PBX and have it installed for about $5k - we've done that, using a vendor we found via Techfinder. You can buy something new for closer to $10k. And if VOIP is a goal, there are some clever startups out there like Fonality, who resell, install and support value-added versions of the open source Asterisk PBX.

2:20 PM  
Blogger laura said...

Thanks for the addition, Peter - very useful! This turned out to be a very complicated question to answer, and Ron was kind enough to contribute his thoughts in the realm in which he was familiar. But the specifics are really helpful.

In fact, are you (or others?) able to add a little more about PBXs? So there's both traditional PBXs (which is a physical installed box which controls your phone system, yes? This is a realm in which I know virtually nothing about), and outsourced PBXs - hosted? How does it connect with your phones?

If you use VOIP phone lines, do you need a traditional PBX too? An alternative type of PBX? Or no PBS at all?

2:54 PM  
Blogger Peter Campbell said...

I think I'd break it down like this:

Phones (POTS, Cell, whatever) are devices that can use a carrier's network to connect to other phones.

VOIP phones (think Vonage, Skype) are like regular phones, but use the Internet as the network, often bridging to the traditional voice networks.

A PBX links a group of phones together in order to add networking features like call transferring, centralized pick-up and routing - important functions for a business.

A PBX can be installed locally with the phones physically wired to it, or hosted, with analog phones routed over the voice network to it. Hosted PBX's are nothing new, Centrex service being the age-old example of that, where the telco charges you more for your lines and provides PBX features. But, like most subscription services, the economics generally support having your own PBX if your staff are centralized and not planning on relocating any time soon.

Virtual PBX services are very much like Centrex, but more flexible and feature-rich - you can have multiple lines set up so that the PBX features are available on your work phone until 5:00, say, then you transfer them to your cell, then you transfer them to your home phone. These seem ideal for a highly mobile work force.

VOIP offers some best of all worlds, because you can install VOIP on your LAN and, with a good system, take your phone to a hotel, plug it in, and be on the PBX. The integration with internet/PCs offers great functionality. But call quality will suffer if your network infrastructure doesn't properly support voice, and that can be costly. One rule of thumb is to consider VOIP when you're moving to new digs and already investing in a buildout and network upgrade.

3:58 PM  
Blogger laura said...

As a follow-up, here's an article with a few more considerations from Small Business Computing: VoIPowering Your Office

12:37 PM  

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