A Crash Course in VoIP

Voice over Internet protocol (VoIP) has quickly infiltrated the telecommunications industry, helping small and midsize businesses to save money and increase productivity. Once a business decides to implement VoIP technology, however, it has additional decisions to make regarding the type of VoIP solution that will best meet its needs.

VoIP works by compressing voice data and transmitting them over a computer network. Using VoIP is more cost-effective than using traditional calling technology because VoIP uses less bandwidth. Other benefits to using VoIP include a simpler infrastructure, zero hardware requirements, easy software maintenance, and the flexibility to create an office wherever an Internet connection is available.

Businesses can choose from a number of VoIP solutions, including premise-based or hosted solutions. A premise-based contact center is physically installed at the client business’s site. The client is very involved in the implementation and is responsible for the maintenance and alterations that become necessary as time passes and improved technologies are introduced. A premise-based solution provides a business with greater control over the contact center and its functionality–but with great control come added costs.

Hosted VoIP is a viable option for companies that do not anticipate having to modify their systems to accommodate rapid growth or other modifications, as well as for smaller businesses that cannot afford the necessary on-premises support of a premise-based solution. What’s more, the start-up costs and initial capital expenditure for a hosted solution are lower than those of a premise-based solution..

Sid Rao is the chief technologist for Indianapolis-based CTI Group, a provider of enterprise-wide information technology software and systems.

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