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How to structure a VoIP budget when moving to the cloud

When migrating to cloud communications, reevaluate your budgets to consolidate overlapping collaboration features, retire hardware and transition to an Opex model.

The shift to cloud-based telephony and collaboration has forced decision-makers to reexamine their communications budgets. New unified-communications-as-a-service offerings make two fundamental changes to legacy products. They unite many communications functions that were previously separate services and shift the budget strategy from Capex to Opex.

The best way to start reexamining budgets is by taking inventory of hardware and software, because a budget is essentially an inventory of items and associated costs. Failing to include all items will result in an inaccurate voice-over-IP (VoIP) budget. Be sure to include all essential items and use inventory as a starting point for building a checklist of VoIP budget items.

When migrating to unified communications as a service (UCaaS), you have to do more than just port numbers to save money. You must also cancel old phone lines and associated hardware, or you might end up paying for unused and forgotten legacy telephony gear and services.

Consolidating collaboration features

UCaaS provides new features and functions that may have existed in hardware or software that's separate from your PBX service. These older items may have also been in a different department's budget. All UCaaS features and functions must be included in the inventory, as well as the legacy counterparts that need to move to the UCaaS budget.

Certain functions -- such as teleconferencing, call recording and e-fax -- are closely related to core telephony, but might be handled by separate hardware and service contracts. Because they are core telephony tools, they'll likely be included in every UCaaS system.

Some of these functions might be implemented in hardware that's separate from your PBX and be on different contract cycles. Therefore, you'll need to cancel and remove the services and hardware once your UCaaS migration is in place and the legacy contract periods have ended.

Most UCaaS products offer extensive collaboration features, including instant messaging, screen sharing and video conferencing. The latter two might be licensed by your company separately with services such as Cisco's Webex or LogMeIn's GoToMeeting.

While some UCaaS tools might not have all the bells and whistles found in dedicated products, they may be good enough for many users. So, you could save money in other areas by migrating to the collaboration tools in UCaaS platforms.

In addition to core collaboration tools, organizations may need to consider specialty options, like call centers. UCaaS providers offer call center functionality on a per-seat basis, and these tools may be sufficient for many companies. Here, too, VoIP budget money could be saved by eliminating or reducing stand-alone call centers and migrating to UCaaS-based call centers.

Capex vs. Opex for UCaaS and VoIP budgets

One of the main attractions of UCaaS is removing hardware ownership from the customer and, instead, using a subscription-based model. Thus, you will see your Capex budget shrink as you move to a rental model, which presumably creates higher Opex.

For legacy systems, a big part of Opex was attributed to system administration functions. While you will still have sys admin chores in UCaaS, installation, maintenance and upgrades required by your legacy, on-premises PBX will vanish. Your previous sys admins should have time for other tasks or be moved to other parts of your IT environment. Those changes might not appear in your budget, but they are real savings nonetheless.

UCaaS provides flexible functionality and enticing pricing. But, once you move to UCaaS, it's hard to go back to on-premises systems. What options would you have if pricing was no longer as attractive, or if you find that renting forever is not as cost-effective as owning your own PBX system? As you move to UCaaS, in-house expertise will certainly vanish over time, and going back to a hybrid setup may no longer be an option.

This was last published in May 2019

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