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Cloud Telephone Systems and Their Multiple Benefits Are Giving VoIP Services a Healthy Boost

Business Phone Systems Featured Article

Cloud Telephone Systems and Their Multiple Benefits Are Giving VoIP Services a Healthy Boost




November 01, 2013


By Laura Stotler, TMCnet Contributing Editor

The cloud is no longer merely a force to be reckoned with in the IT space; it is a true disruptive technology that is changing the way organizations conduct business. The benefits of the cloud in the IT arena are pretty well known, but it plays a unique role in the telephony and telecom space, and one that hasn’t been as widely touted.


Cloud phone systems offer a host of benefits for customers and service providers alike. A recent report from Infonetics (News - Alert) Research shows that cloud telephony is giving the VoIP services space a healthy boost, and cloud phone systems are becoming more common. In fact, cloud telephony sits alongside unified communications and SIP trunking as one of the major solutions that vendors are pitching to their clients.

“Vendors are increasingly pitching cloud telephony and unified communications services alongside SIP trunking as more multi-site businesses seek out hybrid solutions,” said Diane Myers, principal analyst at Infonetics.

Demand for enterprise cloud-based services along with hosted VoIP and unified communications solutions rose 17 percent from 2011 to 2012. Service providers and VARs are increasingly realizing that cloud phone systems provide cost savings as well as simplicity and flexibility, in addition to a host of other benefits.

Since cloud-based telephony is provided “as a service” and hosted off the customer premises, clients are spared the costs and maintenance required for traditional PBX (News - Alert) and telephony equipment. And yet cloud offerings provide the same level of functionality and mobility, and in many cases even more value-added features.

Because cloud software isn’t connected to a specific server or location, users get the benefit of portability and find-me, follow-me functionality, no matter where they are or what type of device they are using. And businesses and service providers benefit from simple and cost-effective scalability based on business fluctuations, as well as flexible billing based on only the resources needed.

Another interesting benefit of cloud telephone systems is the customer service component. Since service is software based, integration with CRM is simple and may lead to productivity improvements. Many cloud telephony systems also have built-in business continuity so that phones may be quickly relocated in the event of a disaster or power failure.

Small-to-medium sized enterprises (SMEs) are the target market for cloud-based phone systems, since they are searching for cost-effective ways to get additional benefits from their telephony and communications services. A report from Heavy Reading shows that SMBs are willing to try cloud telephony services, since they may not have the CAPEX required for major infrastructure investments.

And the fact that smaller companies can also save on operational expenditures, since they don’t need dedicated personnel to manage and maintain systems, is a major benefit and a compelling factor in adoption. That also makes cloud telephone systems appealing to larger companies with multiple locations or widespread workforces.

The real estate and legal markets are also excellent candidates for cloud-based telephone systems, since personnel are geographically disparate as well as mobile.

“Few people understand the potential in cloud telephony, which represents a significant opportunity for replacement of traditional telecommunications systems, especially for SMB communications services,” notes a Market Research Reports study. The research firm finds that in addition to the cost savings and productivity enhancements phone systems provide, they also offer bells and whistles like unified communications functionality, single number integration and support for multiple locations. Not to mention improved disaster recovery and business continuity.

While traditional VoIP service providers and network operators have already discovered the benefits of offering cloud-based telephony to their customers, a number of other market segments are discovering the benefits of providing these solutions. These include managed service providers (MSPs), value-added resellers (VARs) and cloud-based infrastructure-as-a-service (IaaS) providers. Ultimately, they will have to figure out the best way to market cloud telephony to their customers and convince them of the benefits.

On the customer side, there are a number of factors to be considered when selecting cloud-based telephone services. Obviously, features are a major consideration, and CRM, conferencing, and unified communications functionality may all prove beneficial. Clients should also look at upfront costs to ensure they are getting the most value for their money based on the number of system users.

The total cost of ownership is another important consideration, and customers should make sure they are getting adequate savings. This will come in the form of capital expenditure savings since service providers will own and manage the equipment, as well as operational expenditure savings since in-house personnel are required to manage and maintain systems.

Customers should take a careful look at their existing infrastructure and measure that against potential cloud-based offerings, to ensure they’re getting the most features and functionality from their new system. And finally, the ability of any cloud-based offering to scale to meet fluctuating business needs is crucial. Quick and easy scalability is one of the best benefits of cloud-based telephone systems, and any new offering needs to be able to meet your organization’s changing business requirements.




Edited by Rory J. Thompson
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