IP Telephony

IP Telephony

Choosing your perfect voice product has become more difficult than ever – as technology has advanced, we’ve gone from analogue exchanges to digital and virtual systems. Picking the ideal office phone system for your organization will increase profits and productivity, and increase greater long-term value.

Steps to choosing a business telephone system

Until a few years ago it was pretty simple; you picked the brand and the hardware, had your lines installed, your handsets connected and if you needed to take more calls, you installed more lines. But as the functionality of telephone systems has increased, the buying process has inevitably become much more complicated.

We hope that by helping you understand the benefits of each type of phone system on the market, this will help in the decision making process. Don’t just think about what you require today, but what features and functionality you will need in many years’ time.

Telephone systems today fall into four principal categories:

  • PBX phone systems
  • IP enabled phone systems
  • IP PBX systems
  • Hosted IP telephony
  1. PBX phone systems

Phone systems have evolved dramatically since the explosion of super-fast connectivity and the demands to integrate numerous channels into one connection i.e. voice and data. Many businesses still think that investing in PBX phone systems is a safe solution, but what many fail to realise that as phone systems continue to advance and integrate with a company’s computer environment, the unnecessary PBX technology will no longer be used.

Whilst investing in a PBX phone system may be for your business if you need very basic telephony features, if you’re looking for a long-term, scalable solution then traditional calls and lines is not the way to go.

Many businesses prefer to operate on traditional PBX phone systems with their own in-house overheads. Usually this is in the form of a common room that is looked after by your IT team, it also gives you full ownership of the hardware unlike in other PBX solutions. For companies operating out of one building, the PBX phone system can be just as beneficial as a virtual system.

The emergence of VoIP as a preferable business application has influenced the demand for hybrid phone systems and IP phone systems which combine the best of PBX functionality with flexible IP architecture.

  1. IP enabled phone systems

For many businesses, new technology is seen as a risk which makes them hesitant to upgrade or migrate to a fully IP/VoIP environment.

An IP enabled PBX phone system can easily address communications challenges and adheres to those who are hesitant to migrate by using or combining SIP connectivity, digital extensions and ISDN trunks, meaning that you have the option to make calls completely via the internet, or the traditional PSTN.

This not only extends the shelf life of your traditional PBX phone system (for example, moving to virtual extensions when you run out of physical extensions) but also allows businesses to deploy new and seemingly ‘risky’ applications at their own pace.

  1. Pure IP phone systems

IP PBX phone systems are rich in features and functionality, often designed to be modular, extensible and flexible – based on open standards technology so that they can be fully developed with third party applications. This gives businesses the option to migrate to a fully managed, unified communications solution.

IP PBX phone systems are convergence ready, improve network scalability and support multiple offices, mobile workers and changing IT environments.

Investing in IP PBX phone systems removes the need for confusing and costly ISDN circuits to drive down costs while maximizing efficiency in your workplace. Using SIP technology your business can still access the PSTN but voice traffic is instead sent over a data connection. An IP PBX solution is also able to switch calls between VoIP and traditional telephones while still offering the same functionality of your traditional PBX phone system.

  1. Hosted Telephony

Unlike most telephone systems that require connections to public trunks, hosted telephony – or a ‘cloud PBX’ – is delivered purely over a broadband connection or SIP protocols. So-called ‘hosted’ as the phone system is ‘hosted’ off site in a secure data centre, you gain access to the system via an intuitive dashboard or quality IP handsets.

Instead of forking out for the system, hosted or cloud telephony is charged on a fixed monthly fee per user, and the hardware is owned and maintained by the service provider. Telephone systems situated in-house generally have a lifecycle of around five to seven years, unlike hosted phone systems which are software based and upgraded on an annual basis.

Key issues to consider

  1. Connectivity

If considering a move to IP based communications or hosted telephony, it is of paramount importance that your business has the level of network connectivity to be able to support the solution.

When the internet was created, it was not designed to handle VoIP as VoIP was non-existent at the time. While the internet can handle, to some extent, VoIP traffic, when used over a super-fast network such as fibre broadband or MPLS, it provides greater benefits, better quality and bigger cost savings.

VoIP will continue to replace ISDN telephony services, so for large businesses wishing to make the most out of a voice over data service then the key component is your type of connectivity.

The benefits of upgrading your connectivity in an IP environment:

  • Improved voice quality
  • Improved security
  • Access to more robust features not available with standard PBX systems or ISDN channels
  • Cheaper SIP costs
  • Multiple QoS at all points – more on this in the next section
  • Potential for full migration to Cloud services or unified communications
  • Increased functionality
  • Site to site VoIP
  • Remote access for home workers
  • Combine voice and data into one line instead of multiple lines for separate services
  • Disaster recovery
  • Easy network management

In order to maximise on the investment of a nextgen telephone system an early review of your current infrastructure must be made. For example, most credible providers will not be able to guarantee quality with a VoIP over ADSL solution. Carrying out checks – or speaking to a provider early on in the decision process – will help identify any potential quality related issues such as insufficient bandwidth.

  1. QoS

Quality of Service – or ‘QoS’ is an industry-wide set of standards for ensuring the high-quality performance of critical applications such as voice traffic. Its goal is to provide the successful delivery of service for voice traffic over a network by ensuring sufficient bandwidth, controlled latency and jitter and reducing data loss.

The network performance will need to be evaluated at its most vulnerable (busiest time of the day) so that congestion can be considered. Sufficient bandwidth must be made available for future applications such as video conferencing.

QoS provides the following benefits:

  • More control over network resources and allows you to manage the network from a business, rather than a technical, perspective
  • Ensures that time-sensitive and mission-critical applications (such as voice traffic) have the resources they require, while allowing other applications access to the network
  • Improves user experience
  • Reduces costs by using resources efficiently, thereby delaying or reducing the need for expansion or upgrades

QoS depends on the type of connectivity/network solution used by your business. When implementing a VoIP or IP PBX phone system it is highly recommended that you invest in a QoS network that will prioritize your voice traffic.

Costs comparison – what you can expect to pay for per system

It is best to look at your phone system as a long-term financial plan. For example, you may think that by owning your phone system (such as a PBX system) you may be better off, but maintenance and support for a five to seven year cycle is expensive.


Costs also need to be measured against the long term savings to your business and the influence upon productivity etc. You will also need to bear in mind on-going costs such as adding new users, moving offices and other service costs.

  1. PBX phone systems
  • Initial upfront cost/investment
  • Owned by your business
  • Prices for PBX phone systems range from around £130 for a system with two lines and up to six extensions all the way up to £700+ for a system with 16 lines and 64 extensions
  • Resources needed on-site to manage the system – IT teams, telecoms managers etc.
  • Adding new features to PBX systems requires significant engineering in the central PBX, this can often mean that if you are fast growing and require urgent applications this could be very timely and cause losses for your organisation
  • Expensive to move offices and may require downtime
  • Extra installation costs every time you need to add more lines or users
  • Support and maintenance contracts are usually charged on a monthly basis and you will often have to cover the cost of an engineer visiting the site to fix any issues
  • You will be charged national and international rates on calls using the PSTN
  1. IP PBXs/IP phone systems
  • Owned by your business
  • Initial cost required up front but generally cheaper installation costs as it is less complex to install i.e. plug and play
  • An IP PBX will cost anything from £600 to £2,000+ depending on the number of users
  • Costs can be saved on a long-term basis as virtual upgrades are easier to facilitate and do not require the installation of hardware extensions
  • Optional maintenance and support contracts, but some resources needed on site
  • Calls are cheaper when made over a data connection as you are bypassing the PSTN
  • You may need to upgrade your connectivity solution which can be costly
  • Improves productivity and lowers costs by facilitating home/remote working and save on mobile bills by integrating with mobile VoIP
  1. Hosted phone systems
  • Owned by your service provider
  • Cost effective – up to 70% cheaper than many other phone systems
  • One off set up fee and then billed on a per user, per usage basis but cheaper as you are not paying for any equipment
  • All extensions can call each other free of charge – great for international businesses wishing to connect multiple offices in different locations
  • Cheaper national and international costs
  • Your hosted phone system can go wherever you go, and easily switch offices – all you need is a secure data connection
  • Increase or decrease the number of extensions as and when required with no extra installation
  • Low upfront costs and cheaper installation costs as there is less hardware and less downtime to your business
  • No resources needed in-house to manage the system as the system is supported, maintained and upgraded by your provider – perfect for small businesses who don’t want to invest in a big IT team
  • Cheaper international and national calls
  • Significant investment into your connectivity may need to be made i.e. upgrading to an QoS network
  • Flexible, scalable and future-proof, your phone system is never out of date

Other things to consider

  • Support/training – What level of technical support will be on offer? Will your staff need training on how to use the phone system? Is there a charge for support and training?
  • Call packages
  • Mobiles – What other products does a provider offer? Can they reduce bills elsewhere in your communications
  • Addons and features  – how easy is it to extend the functionality of your phone system? Does your provider offer network level features such as bespoke IVR menus or call queuing systems? This will be much better in the long run instead of having to source different products from separate providers.

Choosing your provider

No one phone system solution is right or wrong or more beneficial than the other – as it depends entirely on the needs of your business.

Many big name carriers choose to sell their systems to end users through specialist resellers, which often works out better for you. Purchasing your whole solution and add-ons from one supplier rather than multiple suppliers provides beneficial multi-tier solutions with one single point of contact.