Choosing the right phone system for your business can be daunting. However, if you understand the difference between the types of phone systems, you can make the best choice to meet your business needs.
This refers to the traditional phone systems that are supported by either a local or regional phone company. A landline is a telephone that is connected to copper wires that run underground and are connected to all other landline phones across the world via networks commonly referred to as POTS (plain old telephone service) or PSTN (public switched telephone network). This type of phone system has been in use since the 1800s and utilizes a technology that has proven to be stable and very reliable.
On-premises private branch exchange (PBX) hardware is required to run a landline service. PBX is responsible for creating multiple extensions and allowing for a variety of phone system features, such as call directories and the ability to transfer calls. It is becoming common to see landline systems that are connected to the data network of a business which is then used to connect all individual phones.
Best suited for
A traditional landline system is necessary for any business that does not have access to high-speed internet. However, large corporations tend to utilize a traditional landline system as they have the budget required to pay for it as well as to pay for in-house staff skilled in the management and maintenance of a landline system.
- Pros: Landlines are a time-tested and unquestionably reliable phone solution. For instance, unless you use a cordless phone, power outages do not affect a landline’s functionality. Furthermore, landlines do not suffer from connectivity issues.
- Cons: Although they are among the most reliable phone systems available, most phone system providers are phasing them out. In fact, they most likely will become obsolete. As a result, it is becoming increasingly more difficult to purchase them as well as repair them if something should go wrong.
A virtual phone system can be likened to a call forwarding system as they connect incoming calls made to the main business number to remote workers on either a home or mobile phone. However, virtual phones include a variety of features important to businesses, such as an automated receptionist, online faxing, and toll-free numbers.
Best suited for
Sole proprietors as well as smaller businesses that are mainly composed of remote workers benefit most from a virtual phone system.
- Pros: For a small business that operates mostly offsite, a virtual phone system helps the company to consistently present a professional image. Additionally, employees have access to a number of phone system features that a typical mobile phone or home phone does not provide.
- Cons: Because a virtual system is not an actual phone system, calls are typically processed through your home or mobile network. As a result, any calls you make or receive will use your minutes and may incur charges. However, some virtual phones come with apps that allow you to make calls via the internet
3. VoIP system
A VoIP system is a telephone system that, via hardware or software, utilizes voice over IP (VoIP) technology to both receive and send calls over an IP network. This type of system converts analog telephony audio into a digital format. This digital format can them be transmitted over the internet. To receive calls, the system converts digital phone signals that are incoming via the internet into normal telephone audio. Additionally, there is no need for the copper wires that landlines utilize because a VoIP phone system is connected directly to the internet the company is using.
One of the best highlights of a VoIP system is that users can access a variety of features that were previously only accessible to large corporations that utilized rather expensive, if not cost prohibitive, PBX hardware. For instance, with a VoIP system, users can enjoy features important to the success of many businesses, such as call queues and automated attendants. VoIP systems also allow for computer integration for such features as sending voicemails to email inboxes as well as the ability to turn computers, laptops, and tablets into soft-phones.
Finally, businesses can easily integrate their VoIP phone system with a variety of third-party software and tools, such as email marketing tools or customer relationship management (CRM) tools.
Best suited for
Small businesses needing the functionality of a more complex, feature-packed phone system benefit best from a VoIP phone system as they are reasonably priced. Additionally, this type of system is perfect for a small business that requires its remote employees to have access to the company’s phone system.
- Pros: A VoIP system does not require you to be in the office to make or receive phone calls. Setting one up is easy, and these systems cost significantly less than a landline phone system. Additionally, there are no on-premises charges to add lines as your business grows.
- Cons: A VoIP phone system requires a stable internet connection. If your business is located in an area with a history of spotty connections, you may want to consider a more suitable alternative.
4. Types of VoIP system hosting
One of the best features of a cloud-based VoIP phone system is that there are no hardware or maintenance issues other than the actual phones. The service provider is responsible for housing the system as well as for maintaining and upgrading the PBX technology. Additionally, growing businesses that use a cloud-based hosting system can quickly and easily add subsequent lines and provide its employees frustration free access to new features. Payment is typically per-user and billed on a monthly basis.
Best suited for
This type of hosting is best for a business that is on a fixed budget and does not have in-house IT to maintain and operate PBX hardware.
- Pros: Installation is conveniently done from your computer. Additionally, you are not required to purchase or maintain PBX hardware because that is the responsibility of your provider.
- Cons: If the system goes down, you have to wait for your provider to fix it.
As the name implies, all of the equipment, including the PBX hardware, is housed on your business’s premises. This type of hosting is quite expensive because you are required to purchase the equipment upfront. Although the hardware purchase is a one-time fee, there are monthly fees for the PRI circuit or SIP trunking that allows you to make and receive your calls. Additionally, you will need an IT staff that is capable of maintaining or repairing the system as needed.
Best suited for
If a business is not comfortable using the cloud and prefers to retain total control over their phone system, on-premises hosting is the best choice. On-premises systems are also best suited for businesses that experience compliance or regulatory requirements that may not be easily met with a cloud-based service.
- Pros: You will always have complete control of your service and can configure it to your exact specifications.
- Cons: The initial costs are significant. You are also responsible for retaining staff that can maintain and service the system.