What is the best phone service for small business?

Studies have shown that compared to using a PSTN (Public Switched Telephone Network) line, using VoIP can potentially save you up to 40 % on local calls, and up to 90 % on international calls.

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Traditional telephony is dying while VoIP(Voice Over Internet Protocol) is becoming ever more popular. Internet Protocol (IP) communications technology is not new, it has been around for a couple of decades. But, VoIP implementation has only increased recently due to the improvements in technology. VoIP phone systems offer something much more than simple voice calls. They offer a feature-rich communication solution. At the same time, the VoIP costs are kept low by converging voice with data networks. With more businesses switching to VoIP systems, it has now become a business standard.

This FAQ provides answers to the most common questions asked by small businesses about VoIP phone systems. It can lead you on the way to choosing the best VoIP phone system for your business. You can use this VoIP FAQ as a resource to get acquainted with VoIP telephony and VoIP phone system.

  1. What is VoIP?

  2. What are the benefits of a VoIP phone system?

  3. What kind of Internet connection do I need for VoIP?

  4. How much bandwidth does a VoIP conversation use?

  5. What should I look for in a cloud communications system (VoIP)?

  6. What Equipment Do I Need for a VoIP Phone System?

  7. What Is Hosted VoIP?

  8. What is an on-premise business VoIP phone system?

  9. If I Move Offices, Will I Have to Start Phone Service Over Again?


These are some of the most commonly asked questions about VoIP phone systems. It is in no way an exhaustive list but it does cover the basics. By the end of this FAQ, you should have a better understanding of the VoIP system, its requirements, and the benefits of VoIP for small businesses.

1. What is VoIP?

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Voice over Internet Protocol (VoIP) or IP telephony, is a technology that delivers voice and multimedia over Internet Protocol (IP) networks, such as the Internet. Internet telephony, broadband telephony, and broadband phone service are synonymous and refer to communications services such as voice, fax, SMS, and multimedia delivered over the public Internet.

In short, VoIP lets you make phone calls over your broadband internet instead of a traditional phone line.

2. What are the benefits of a VoIP phone system?

VoIP has many advantages over the traditional phone system. Here we list a few of them:

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  • It drastically reduces communication cost.

    You will not have to think twice before making international calls. VoIP can potentially save you up to 40 % on local calls, and up to 90 % on international calls

  • A VoIP phone system can be easily scaled up or down.

    Adding phone lines for new hires is just a few clicks away. Removing the lines is equally as simple.

  • Improved call quality.

    With VoIP you can say goodbye to choppy lines, one-way audio, humming or buzzing and other communication errors.

  • Greater Flexibility in network layout.

    You don’t need to run additional cables for your phone. You can use the existing Ethernet cable or even your WiFi network.

  • Business features and Integrations.

    VoIP offers a host of useful features that bring more value than the savings in call cost. Here is a short list:

    • Door phone entry buzzer

    • Find me/follow me call routing

    • Voicemail to email transcription

    • Bandwidth utilization and inbound/outbound call detail reports

    • Call screening

    • On the Call Coaching tools, and many more.

3. What kind of Internet connection do I need for VoIP?

For a VoIP phone system, you will need a broadband Internet connection such as DSL, Cable, T1, wireless, etc. Internet requirement for VoIP depends on a number of variables. In general, you should have at least a 100kbps on both upload and download.

4. How much bandwidth does a VoIP conversation use?

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The bandwidth required for VoIP calls depends on the codec used. The codecs optimize the media based on application requirements and network bandwidth. For example, if your VoIP service uses a non-compressed codec (G711), the bandwidth required will be about 100kbps of both the upstream and downstream. In such a case, every 1000 minutes of call will use about 1.5 GB of bandwidth.

5. What should I look for in a cloud communications system (VoIP)?

Here are a few things that you should look for:

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  • Features

    VoIP services generally offer as part of the basic monthly fee many features, such as call waiting, call forwarding, voicemail, call forwarding on busy, etc.

  • Integrations

    Determine if your VoIP service provider offers integration of other services such as faxing, alarms, CRM, and credit card machines, etc.

  • Customer service and Technical support

    This is an important criterion for selecting a VoIP service. All the features and integrations will not be of much help if your communication system is down for long periods.

6. What Equipment Do I Need for a VoIP Phone System?

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If you're using hosted PBX (Private Branch Exchange) or residential VoIP, apart from a high-speed internet connection, you would need an IP phone or an ATA adapter.

For a cloud communication system, you don’t need much VoIP hardware to get started. It can be set up with a physical phone by using an adapter/router, or with a smartphone/computer.

7. What Is Hosted VoIP?

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Hosted PBX or an Internet Business Phone System refers to a VoIP business phone system service that is offered by a provider that hosts physical servers running users’ services at a separate location.

You typically access the service via a direct network connection. Hosted PBX services provide you with full functionality without any “PBX hardware” in your premises. This service is therefore delivered entirely through the internet. Since this service is scaled to a predetermined size, it doesn’t offer flexibility or scalability. All the features are uniform and the service is constant.

8. What is an on-premise business VoIP phone system?

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An on-premise business VoIP phone system is where all the hardware is at your physical location. In this system, calls are passed through your own server over a dedicated voice network connection. On-premise business phone networks have higher upfront installation and maintenance cost as well as longer implementation time.

However, it gives you more control over the call quality and reliability. It is more customizable and flexible. In addition, the cost of ownership is lower when measured over a long period.

9. If I Move Offices, Will I Have to Start Phone Service Over Again?

One of the best features of VoIP phone systems is how easy it is to move. You do not need to wait for a technician to run the phone wires at the new office. You can simply take your computer and/or handset to the new location, connect to the broadband, and start using your VoIP phone service.


Adopting A Business Phone System

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Adopting VoIP technology may seem a little daunting in the beginning. However, the benefits are immense and you will reap the rewards even far into the future once you adopt VoIP. For small and medium businesses VoIP offers a host of useful features that bring more value than the savings in call cost. IP telephony and unified communications offer many integrations that make your business much more efficient as well as professional.


IP networks that do not have a proper internet connection can get easily congested. This can result in dropped calls and/or poor voice quality. Therefore, you need to make sure that your IP network has a stable internet connection and sufficient bandwidth. Unlike traditional phones, a VoIP phone system requires power. VoIP phones and the routers depend on the main electricity lines for power and will go off if there is a power outage. This can be mitigated by installing a UPS. Also, using PoE (Power over Ethernet) will immensely simplify your IP telephony network.

There is a lot to handle if you want to set up a VoIP phone system properly for business use. But, the investment is worth every penny and will start giving returns immediately.


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