Phones are very nearly a thing of the past. VoIP is the service that is beginning to replace them and with good reason: it’s (almost) free.

The term VoIP is an abbreviation for Voice over Internet Protocol. It’s a method of providing voice communications over IP networks, the most relevant and universal of which is the Internet. Basically, it allows you to use the Internet (or another packet based network) in place of a phone service, at a fraction of the cost.

So why isn’t the future here yet? While VoIP has great potential for use in business and at home, it’s still only in its infant stages. Before throwing all of your telecommunication handsets in the bin, you should have a good idea of just what VoIP can and can’t do and whether it’s appropriate for your business. Cue: Nett’s VoIP Pros and Cons List.

Pros

The biggest drawcard for VoIP is that when it isn’t free, it’s cheap. Provided you have a network of contacts that are using the same provider as you are (Skype is the most widely used), then calling computer-to-computer and creating conference calls will cost you nothing.

Although there is VoIP specific phones are readily available for purchase, they tend to be considerably more expensive than normal phones and tend to be difficult to configure. Given that your entire business may end up using VoIP, much money can be saved by instead investigating IP phone software. Talking directly into a headset attached to your computer may feel stranger than using a phone, but if you’re upgrading your entire business to VoIP, you could save a lot this way.

Once again, Skype is the most popular softphone used, but shouldn’t be viewed as a default option. Nimbuzz is worth investigating as it provides interfaces for mobile phones as well as web-based and installable options, while offering free SMS and relatively cheap calls. Voipstunt is also worth investigating, as it eliminates the main cost of using VoIP: it offers free calls to landlines and mobiles as well as online.

There are a number of scenarios in which it would be particularly useful, however. If many of your employees work remotely, and you’re paying for their home phone Internet access, for example, VoIP will save you time and money. A VoIP system can be used to replace a Wide Area Network if your business has a number of sites. It can reduce costs if your business makes a lot of long-distance calls. It’s also worth considering if your company is moving to a location that is isolated from traditional communication networks for some reason.

Cons

The quality and functionality of your VoIP service relies heavily on your Internet connection. As Internet in Australia is still less functional than elsewhere in the world, this is a vital aspect to consider before making the switch. High traffic can impact adversely on your connection, as can high levels of network security. The lines are by no means high quality compared to a normal phoneline. Having your voice dropping in and out while echoing inexplicably is not a particularly professional impression to make on a client. Also, most providers only let you call other users on their networks for free.

And, while the charges for mobile and landline calls are relatively low in comparison to traditional phone carriers, their existence goes someway to negating the cost effective appeal associated with VoIP. It’s easy to forget that these things add up. Speaking of which, if you opt for a VoIP hosting service, it’s likely you’ll be required to purchase the handsets and routers regardless of whether you need them, and then pay a monthly subscription fee. Although this will give you a functional edge later in the VoIP game, it’s currently just as cost-effective to stick with normal phones.

So, VoIP, in its beta stages, is not appropriate for every business. Look at it more as a way of avoiding certain burgeoning costs in particular situations, rather than a massive paradigm shift in telecommunications that you can’t live without. It’s not quite the future yet. #