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Understanding the small business VoIP transition

Small and midsize businesses are looking to make the VoIP transition to solve the problems caused by legacy phone services and meet the needs of a changing workforce.

The majority of small and midsize businesses (SMBs) are still using legacy phone services, but many are looking to make the transition to small business VoIP services to solve business problems and support a growing mobile workforce, according to a recent industry report.

When transitioning to VoIP, the actual company size of SMBs impacts the challenges they face with their phone services and the providers they choose, according to the report, which surveyed 1,250 telecom decision makers in SMBs ranging from one to 1,000 employees, with the majority of respondents in the five- to 250-employee range.

For smaller SMBs, which the report defined as 50 employees or fewer, traditional phone system problems include a lack of mobile integration, difficult system management and call-quality issues. When transitioning to a small business VoIP system, services from competitive local exchange carriers (CLECs) and over-the-top (OTT) providers were most popular.

J Arnold & Associates analyst Jon Arnold, who authored the report, said smaller SMBs tend to lack in-house IT staff and are more cost conscious. CLECs and OTT providers have smaller infrastructure that allows them to offer cheaper services that don't require much support from IT.

Midsize SMBs, which the report defined as 51 to 250 employees, encounter problems such as  lack of capacity to add users,  lack of advanced features and difficult system management. Midsize SMBs have more IT experience and opt for more traditional providers and telecom equipment providers.

"Their needs will be more complex than smaller SMBs, and they will lean more to traditional providers since they offer more complete solutions," Arnold said.

Once businesses start using VoIP, they see the possibilities that come from integrating telephony with other applications.
Jon Arnoldanalyst, J Arnold & Associates

While smaller and midsize SMBs buy from different providers and look to solve different business problems, cost is still the main driver for a small business VoIP transition.

"They need to see cost savings," said Bryan Grimm, senior manager of market development at network software provider Metaswitch Networks, which conducted the survey. "They want a product that's robust and feature-rich, but don't want to pay a whole lot for it."

Important UC features growing amid small business VoIP

SMBs are beginning to see the need for unified communications (UC) features in their VoIP systems as more employees use personal devices for work. More than 70% of SMBs said they would consider a provider that offers UC features like presence and mobile clients, according to the report.

"Once businesses start using VoIP, they see the possibilities that come from integrating telephony with other applications," Arnold said.

He said VoIP provides businesses with the platform to put all their business applications together into an integrated experience for employees.

Grimm said moving to a small business VoIP service that offers some UC capabilities has become an easy decision for businesses.

"UC is a really good way they can be competitive to hire next-generation talent," he said.

Next Steps

Making an effective VoIP transition from PSTN

The factors to consider before buying VoIP services

NEC's Univerge service supports small business VoIP


Dig Deeper on IP Telephony Systems