Communications are the lifeblood of any business. Making the move to empower those communications with an updated business phone system is a big decision for businesses of any size. But the available information can sometimes be unclear—and the number of available options can be dizzying.As you have started your evaluation process, you have surely encountered the term VoIP. This big buzzword is everywhere—from tech blogs to talks in your industry. As a leading Ohio VoIP provider, the BCS team finds itself fielding questions around this ubiquitous term when discussing options. We also often find that wires can get crossed when people are discussing VoIP since this terminology can be used in so many distinct and different ways.
To help get everyone on the same page, we thought we would lay some groundwork and not just define what VoIP technology is, but cover some of the common ways that it is used to describe enterprise phone system options.
Use our guide to VoIP phone systems to shed some light on this sometimes-cloudy technology and help inform your journey toward a new business phone system.
What is Voice over IP (VoIP) and how does it work?
Voice over IP, or VoIP for short, stands for “Voice over Internet Protocol.” In simple terms, VoIP technology takes the sound of the voice and turns it into data packets that are transmitted over a data network, or the internet, as opposed to a traditional phone line.
So, rather than requiring all the wired infrastructure of traditional analog phone lines, your calls and business communications assume the form of a digital signal, capable of being sent around the world in seconds over the internet.
What are the types of Enterprise phone systems?
VoIP is used in a variety of contexts to refer to many different things—including both the general technology described above and specific types of enterprise phone systems that utilize VoIP technology. The most common ways VoIP is used include:
- Cloud-based phone systems
- On-premise, or onsite, phone systems
- Session Internet Protocol (SIP) Trunking
Each of these describe different types of business phone systems that have their own nuances as well as benefits and drawbacks, which we outline below.
Cloud phone systems
When people talk about VoIP systems, they are most often referring to a cloud-based phone system. This setup lets you make phone calls over the internet through a third-party provider. This off-site provider hosts the service—which is why it is also sometimes referred to as Hosted VoIP—on a system of secure data centers that transmit and store the data packets involved in a business’s communications.
With a subscription to a cloud phone service, your business can use this VoIP phone system without the need or costs of managing and maintaining associated onsite hardware. Plus, cloud phone systems typically offer integration with other methods of communication that today’s businesses use. So, computers, tablets, and even traditional landlines can be connected through the same service, under the umbrella known as Unified Communications (UC) or Unified Communications as a Service (UCaaS).
On-premise phone systems
Another common way that VoIP technology is deployed in business phone systems is through on-premise hardware. An on-premise, or onsite, VoIP phone system is entirely housed locally, at the site of your business.
On-premise phone systems are primarily used as a means of updating your existing phone infrastructure. For instance, you might have an older digital phone system at your office. This digital phone system isn’t connected to the internet—neither your local area network nor your wide area network. Instead, it is connected to your organization’s Private Branch Exchange (PBX), which will route your calls through traditional landlines, or plain old telephone service (POTS).
In an updated, on-premise phone system, VoIP technology replaces this old digital phone system with an onsite IP PBX, meaning that businesses that replace their outdated or unsupported phone system will be able to leverage the huge benefits of VoIP technology.
Session Initiation Protocol (SIP) trunking
Session Initiation Protocol (SIP) and VoIP are frequently used interchangeably. However, SIP is actually a specific protocol that is used by VoIP communications. Without getting too deep into the weeds, SIP simply refers to local and long-distance dial tone communications that are transferred through a data connection, typically a fiber connection.
SIP trunking, then, is the process of replacing traditional phone lines with these data connections. SIP trunking is used by many businesses looking to move their communications to the internet because it lays the groundwork for a future move to Unified Communications.
How to choose the right Enterprise Phone System
While VoIP technology isn’t new, it is always changing. Take the on-premises side of things, for example: In recent years, the range of available technologies has exploded. Now, VoIP-enabled devices can be used as standalone appliances, they can run on servers, they can be virtualized in various ways—or some combination thereof. And across different vendors, all these varying solutions will be deployed in various ways.
Between the fast pace of this change and all the acronyms, buzzwords, and jargon that can easily blur together, figuring how to choose the right office phone system for your business might seem like a daunting process. The BCS team is here to help with that.
Be sure to check out our guide, How to Choose a New Business Phone System, which can help you make an informed decision about updating your phone system. Of course, our team is always here to take your questions and ensure that you have all the information you need to make an educated choice. Whether you are looking to build a better business case for unified communications or need help answering a deep, technical question, our experienced, Ohio-based VoIP experts are always standing by.