Traditional PBX and Hosted VOIP Comparison
Hosted Voice Over Internet Protocol (VOIP), also known as IP PBX, Virtual PBX or Cloud VOIP, is the “next big thing” in business telecommunications.
Content
Traditional PBX & Hosted VOIP
Technology: The Key Differences &
What They Mean For Your Business
CONTENTS
Summary .. ................................................................................... 3
What’s The Buzz About?......................................................................................................... 3
What It Means For Businesses.............................................................................................. 3
What It Means For Employees.............................................................................................. 3
Introduction................................................................................ 4
Hosted VOIP – On-Premise PBX Comparison................................................................. 4
Main Technological Differences............................................................................................................ 4
Analog Signal vs. Data Packets............................................................................................. 4
PBX Technology........................................................................................................................ 5
Major PBX Components........................................................................................................................ 5
Specialized Applications........................................................................................................ 5
PBX End-Of-Life (EOL)............................................................................................................ 5
Hosted VOIP Technology. . ......................................................... 6
Cloud Computing..................................................................................................................... 6
Broadband Networks............................................................................................................... 6
Softswitch Technology........................................................................................................... 7
Quality of Service (QoS).......................................................................................................... 7
Cisco QoS Standards Evaluate:............................................................................................................. 7
Private Network & Public Internet....................................................................................... 7
Data Connectivity - Main Differences................................................................................................... 8
Service Level Agreements & Private Network Connections............................................................ 8
Maintenance & Obsolescence............................................................................................... 8
Cost Comparison–PBX vs. Hosted VOIP ................................ 9
Epik’s Total Voice vs. Nortel PBX.......................................................................................... 9
Conclusion . . ............................................................................... 12
About Epik Networks...........................................................................................................................12
Key Differences Between Hosted VOIP and Traditional PBX | 2
SUMMARY
Summary
What’s The Buzz About?
Hosted Voice Over Internet Protocol (VOIP), also known as IP PBX, Virtual PBX or
Cloud VOIP, is the “next big thing” in business telecommunications. It is changing the
limitations of voice systems and bringing those changes to businesses of all sizes
and industries. In the last few years alone, advanced VOIP systems have gone from
an enterprise-only technology to an everyday reality for businesses across North
America. And, amazingly, of the millions of VOIP end-users, many are working on
comprehensive phone systems that aren’t even located in the same building as their
offices.
After decades of PBX systems, what has changed? The answer is at the root of the
technology, in the transition from traditional telephony to cloud technology, and the
new possibilities that come with it.
What It Means For Businesses
The transition from traditional PBX to Hosted VOIP is more than just a change in
provider, a new system model, or a new service. It is a new technology altogether,
capable of providing the voice services that people are familiar with as well as more
than they ever considered. The advantages range from cost savings and scalability to
enhanced features and mobile integration.
What It Means For Employees
Employees can experience an office phone network that meets their consumer
standards for ease-of-use, multiple device integration, and virtual collaboration.
Colleagues are able to track and communicate with each other, better manage
their interface and shortcuts, and, in a general sense, appreciate using a truly
contemporary system. Why should the office toolkit lag behind personal technology
for the average business?
Key Differences Between Hosted VOIP and Traditional PBX | 3
INTRODUC TION
Introduction
In less than 15 years, Information Technology has gone from a costly, raw potential
to a widely accessible and refined toolkit. From software applications to mobile
devices to the sophisticated networks they inhabit, the private sector has undergone a
transformation driven by new technology.
This is perhaps nowhere more visible than in business telephony, where legacy
phone networks are quickly giving way to the IP and Cloud Revolution. As the
telecommunications industry introduces more mobile and multi-media capabilities
while streamlining operations and expenses, PBX networks become increasingly
outdated and limited.
Hosted VOIP – On-Premise PBX Comparison
Main Technological Differences
Public Branch Exchange (PBX)
Hosted Voice Over Internet Protocol (VOIP)
Uses traditional telephone receiver to convert voice into
analog or digital signals
Uses VOIP software to convert voice into data packets
Transmits analog signals via legacy landlines
Transmits data packets via an IP-enabled private
network or the Internet
Internally deployed & managed
Hosted off-site / delivered via The Cloud
Minimal integration with computer applications
Advanced integration with computer and data
applications
Moves, Additions & Changes (MAC) require internal IT
developments
Moves, Additions & Changes (MAC) require request to
provider
Analog Signal vs. Data Packets
The fundamental difference between VOIP and PBX technology is the method of
transmitting audio information. In both systems, the sounds entering the receiver
are converted into signals. A PBX uses either analog, transmitted in wave format or
digital signals, for digital phone equipment. VOIP uses data packets – small pieces
of information encoded and transmitted via Internet Protocol (IP), the widely used
standard for encoding and transmitting data over the Internet or other IP-enabled
networks.
Key Differences Between Hosted VOIP and Traditional PBX | 4
PBX TECHNOLOGY
PBX Technology
A Private Branch Exchange (PBX) is designed to provide phone service to a group
of people without purchasing independent lines and features for each user from a
telephone service provider. It acts like a Public Switched Phone Network (PSTN) on a
small scale, allowing organizations to use extensions and share a common connection
to the PSTN. When calls are made, they are interpreted and rerouted by the PBX to
another internal number via an extension or to an external number via the PSTN.
Many standard office phone features were developed on traditional PBX systems,
such as call routing, auto-attendants, user shortcuts, voicemail, fax-integration and
countless others. PBX are capable of connecting complex applications, like call centre
systems that enable large scale call management or Integrated Service for Digital
Network (ISDN) systems that enable digital data to travel over traditional landline
networks.
Major PBX Components
•
Telephone Trunk Line – Multiple shared phone lines for each user
•
Computer – Manages call switching, routing and other features
•
Maintenance Console
•
Specialized Applications (e.g. Call Center, ISDN, Conference System,
Auto-Attendant)
Specialized Applications
In order to add new features to a PBX, additional hardware and software systems
have to be installed. A call centre application, for instance, has to be purchased from
a vendor and integrated with the PBX by the office IT staff. Any specialized function
requires a system addition, followed by ongoing updates and upgrades for
continual use.
PBX End-Of-Life (EOL)
PBX phone systems, like other on-premise networks, eventually reach their End-ofLife (EOL). This indicates when a particular model is no longer in production or when
support from vendors and manufacturers has ended. In many cases, the system can
continue to operate as normal, becoming an issue only once repairs or updates are
required. While the EOL date is not always pressing, it marks the beginning of the
system’s decline and the need to explore new options. EOL usually occurs between 5
and 10 years after the product’s launch.
Key Differences Between Hosted VOIP and Traditional PBX | 5
HOSTED VOIP TECHNOLOGY
Hosted VOIP Technology
Voice Over Internet Protocol (VOIP) converts analog signals into data packets that can
be transmitted over the Internet or any other Internet Protocol (IP) enabled network.
Internet Protocol is the standardized method of communicating between locations
and structuring data over digital networks. Each packet is encoded with the receiver’s
address and instructions like other forms of data including emails or web pages. By
sending the voice data over the Internet or a dedicated network connection, the Public
Switch Telephone System (PSTN) and traditional phone carrier play a less significant
role in placing interoffice calls, inter-company calls or long distance calls.
Hosted VOIP uses the same principles of transmitting data, but combines other
breakthrough in communication technology — Cloud Computer and Broadband
Networks — to offer the services and applications in a very different way.
Cloud Computing
Cloud Computing is a general term for a number of different services and applications
that can be delivered over the Internet instead of developed at the location of the user.
Many things today use cloud technology to offer software subscriptions, server space
or virtual networks. Cloud-based services rely on centralized servers that perform a
particular set of functions and then broadband network infrastructure that deliver it to
customer locations as a simplified service.
Broadband Networks
Broadband refers to high-speed and high-capacity data networks and data-handling
techniques. The development and proliferation of broadband has allowed residential
and commercial users to use increasingly complicated and data-laden services at
sustainable costs. Broadband connections, including cable, DSL and fiber optics,
allow Internet Service Providers to stream “high-bandwidth” voice data with fewer
quality issues. Hosted VOIP services combined with a fiber optic connection can offer
applications like video-conferencing for entire offices without sacrificing the quality of
service.
Key Differences Between Hosted VOIP and Traditional PBX | 6
SOF TSWITCH TECHNOLOGY
Softswitch Technology
An advanced software platform, known as the softswitch, functions like a remote PBX
system. As the “brains” of the Hosted VOIP network, it handles call routing, switching,
advanced applications and enhanced features for the provider’s entire network.
Through various built-in or add-on capabilities, the provider can offer on-demand and
customizable service.
The complexity of the softswitch will largely determine the capabilities of the Hosted
VOIP service provider. Some providers opt for a basic softswitch that provides
fundamental phone services that a traditional PBX would, without the hassle of
managing it internally. Providers with advanced softswitches have many more
features to offer clients, including upcoming technologies in the telecom market.
Quality of Service (QoS)
VOIP has struggled with quality issues since it first became commercially available in
the 1990s. It proved difficult to achieve the same audio quality and consistency with
data packets and IP-enabled packets, especially during peak traffic periods.
Since, VOIP developers and providers use VOIP-specific Quality of Service (QoS)
standards that measure the transmission of high-bandwidth applications in order to
better manage network performance. QoS standards are used to shape and prioritize
data to increase, predict and guarantee network performance.
Cisco QoS Standards Evaluate:
•
Bandwidth Requirements
•
Packet Classification
•
Queuing
•
Traffic Shaping
•
Data Compression
•
Frame Relay
Private Network & Public Internet
Connection quality directly influences Hosted VOIP voice quality. One reason is that
voice data is “high-bandwidth,” meaning that it can disrupt a standard connection
if it not managed properly or if there are too many users. Private connections also
influence service quality by providing voice data with a distinct pathway between calls
instead of traveling various pathways across the Internet.
Key Differences Between Hosted VOIP and Traditional PBX | 7
MAINTENANCE AND OBSOLE SCENCE
Data Connectivity - Main Differences
VOIP over Private Network
VOIP over Public Internet
Guaranteed Voice Quality
Standard Voice Quality
Controlled Data Routes
Data Travels Unpredictably
Uptime Guarantee
“Best Effort” Service
Service Level Agreements & Private Network Connections
Voice quality and network uptime can only be guaranteed if the Hosted VOIP service is
deployed via a Private Network. The added control of the private connection makes it
possible to guarantee performance standards that match the reliability of traditional
PBX phones. Hosted VOIP services offered over a generic “best effort” connection can
only be as reliable as that network. A “best effort” service increases the chances of
network and voice disruptions for organizations with many users, continual usage or
data-driven applications.
Maintenance & Obsolescence
Hosted VOIP providers can absorb maintenance and update expenses for all of their
customers without incurring major costs. Issues can be detected and resolved offsite
from the cloud facility, just as updates and upgrades can be focused on the softswitch.
Changes made to the central network in turn effect client networks, providing
simplified network maintenance, continually updates and system-wide upgrades. This
is often an included part of the service, alleviating operational expenses and the risk of
system obsolescence.
Key Differences Between Hosted VOIP and Traditional PBX | 8
COST COMPARISON
Cost Comparison–PBX vs. Hosted VOIP
The savings associated with Hosted VOIP services come directly from the advantages
of the technology; every aspect of an office network can be treated as a service,
allowing the provider to absorb operational and maintenance costs by managing
a single cloud network for countless clients. The client can deploy up-to-date
functionality without the risk and effort of investing in an advanced system.
The results are reduced capital expenditure and operational expenditure. Depending
on the businesses’ current system and particular needs, savings can fluctuate
between the two, but are often possible in both areas. PBX systems, by comparison,
often demand large upfront investments as well as ongoing maintenance in the form
of IT efforts or contracts with PBX vendors. In most cases this translates to more
investment and attention for less functionality.
Epik’s Total Voice vs. Nortel PBX
A comparison of Epik’s Hosted VOIP service and a client’s current Nortel PBX. The
Hosted VOIP service creates 18% savings over 36 months, with the possibility to easily
adjust services and applications along the way.
Figure 1
Key Differences Between Hosted VOIP and Traditional PBX | 9
COST COMPARISON
In this case, the savings result from bundling the phone service with enterprise
Internet services from the same provider, and monthly VOIP long distance fees. There
would be a similar pattern with other voice applications, like conferencing or enhanced
features that would be more cost-effective and easier to manage with the Hosted VOIP
system (Figure 1.1).
Figure 1.1
The monthly savings would actually be significantly more as maintenance and update
costs are not always known in advance (an estimated 15-20%) but are includes in
Hosted VOIP services since the system is managed offsite (Figure 1.2).
Figure 1.2
Key Differences Between Hosted VOIP and Traditional PBX | 10
COST COMPARISON
As demonstrated below, businesses that prefer to purchase the onsite equipment —
routers, switches and IP phones — can pay more upfront instead of a monthly fee.
This means that businesses that take on the capital expense will still see significant
savings. Large capital expense is still compensated for by the monthly operational
savings of Hosted VOIP, saving the client 27% over 36 months (Figure 2).
Figure 2
In this example, it is clear how a specific voice applications (in this case conferencing),
long distance and maintenance add up to significant savings. Each of these is
inherently more cost-effective than the PBX equivalent because of the underlying
technology.
Figure 3
Key Differences Between Hosted VOIP and Traditional PBX | 11
COST COMPARISON
Conclusion
Comparing traditional PBX systems to Hosted VOIP technology is becoming more
and more of an “Old vs. New” story. The core technological differences and the dropoff in future potential put them in practically different categories altogether. Heavily
invested in PBX systems and general office complacency make it difficult to transition
out of traditional telephony, even as employees continue to adopt and develop work
behaviours in relation to high-tech personal and consumer technologies.
The proliferation of VOIP, cloud computing and broadband networks have made
advanced IP telephony widely available and affordable, even more so than standard
PBX networks. Businesses looking for a new system should reconsider what comes to
mind when they think “business phone system,” because for many companies it is the
last barrier between their operation and today’s telecommunications.
About Epik Networks
Epik Networks is the industry leader in advanced data and communication services,
offering turnkey solutions for almost a decade. Through centralized Broadsoft
softswitches and high-speed fiber-optic connections, Epik Networks provides
companies of all sizes with highly customized telecommunications solutions that are
both affordable and completely reliable.
We take care of everything from the hardware and software, to ongoing maintenance.
You will never worry about your voice services again. In addition to all the equipment,
Epik Networks offers one easy-to-understand bill.
Let us show you why over 8000 users have made the choice to use Epik Networks as
their service provider.
Feel free to call us at 1-866-353-9333. Epik sales consultants are standing by to help
guide you to make the best possible decisions for all your telecommunication needs.
epiknetworks.com
Epik Networks Inc. Head Office
[email protected]
80 Bloor St West, Suite 503
Toronto, Ontario, M5S 2V1
Toll Free: 1-866-353-9333
Phone: 416-921-7000
Fax: 416-855-763
Key Differences Between Hosted VOIP and Traditional PBX | 12
Technology: The Key Differences &
What They Mean For Your Business
CONTENTS
Summary .. ................................................................................... 3
What’s The Buzz About?......................................................................................................... 3
What It Means For Businesses.............................................................................................. 3
What It Means For Employees.............................................................................................. 3
Introduction................................................................................ 4
Hosted VOIP – On-Premise PBX Comparison................................................................. 4
Main Technological Differences............................................................................................................ 4
Analog Signal vs. Data Packets............................................................................................. 4
PBX Technology........................................................................................................................ 5
Major PBX Components........................................................................................................................ 5
Specialized Applications........................................................................................................ 5
PBX End-Of-Life (EOL)............................................................................................................ 5
Hosted VOIP Technology. . ......................................................... 6
Cloud Computing..................................................................................................................... 6
Broadband Networks............................................................................................................... 6
Softswitch Technology........................................................................................................... 7
Quality of Service (QoS).......................................................................................................... 7
Cisco QoS Standards Evaluate:............................................................................................................. 7
Private Network & Public Internet....................................................................................... 7
Data Connectivity - Main Differences................................................................................................... 8
Service Level Agreements & Private Network Connections............................................................ 8
Maintenance & Obsolescence............................................................................................... 8
Cost Comparison–PBX vs. Hosted VOIP ................................ 9
Epik’s Total Voice vs. Nortel PBX.......................................................................................... 9
Conclusion . . ............................................................................... 12
About Epik Networks...........................................................................................................................12
Key Differences Between Hosted VOIP and Traditional PBX | 2
SUMMARY
Summary
What’s The Buzz About?
Hosted Voice Over Internet Protocol (VOIP), also known as IP PBX, Virtual PBX or
Cloud VOIP, is the “next big thing” in business telecommunications. It is changing the
limitations of voice systems and bringing those changes to businesses of all sizes
and industries. In the last few years alone, advanced VOIP systems have gone from
an enterprise-only technology to an everyday reality for businesses across North
America. And, amazingly, of the millions of VOIP end-users, many are working on
comprehensive phone systems that aren’t even located in the same building as their
offices.
After decades of PBX systems, what has changed? The answer is at the root of the
technology, in the transition from traditional telephony to cloud technology, and the
new possibilities that come with it.
What It Means For Businesses
The transition from traditional PBX to Hosted VOIP is more than just a change in
provider, a new system model, or a new service. It is a new technology altogether,
capable of providing the voice services that people are familiar with as well as more
than they ever considered. The advantages range from cost savings and scalability to
enhanced features and mobile integration.
What It Means For Employees
Employees can experience an office phone network that meets their consumer
standards for ease-of-use, multiple device integration, and virtual collaboration.
Colleagues are able to track and communicate with each other, better manage
their interface and shortcuts, and, in a general sense, appreciate using a truly
contemporary system. Why should the office toolkit lag behind personal technology
for the average business?
Key Differences Between Hosted VOIP and Traditional PBX | 3
INTRODUC TION
Introduction
In less than 15 years, Information Technology has gone from a costly, raw potential
to a widely accessible and refined toolkit. From software applications to mobile
devices to the sophisticated networks they inhabit, the private sector has undergone a
transformation driven by new technology.
This is perhaps nowhere more visible than in business telephony, where legacy
phone networks are quickly giving way to the IP and Cloud Revolution. As the
telecommunications industry introduces more mobile and multi-media capabilities
while streamlining operations and expenses, PBX networks become increasingly
outdated and limited.
Hosted VOIP – On-Premise PBX Comparison
Main Technological Differences
Public Branch Exchange (PBX)
Hosted Voice Over Internet Protocol (VOIP)
Uses traditional telephone receiver to convert voice into
analog or digital signals
Uses VOIP software to convert voice into data packets
Transmits analog signals via legacy landlines
Transmits data packets via an IP-enabled private
network or the Internet
Internally deployed & managed
Hosted off-site / delivered via The Cloud
Minimal integration with computer applications
Advanced integration with computer and data
applications
Moves, Additions & Changes (MAC) require internal IT
developments
Moves, Additions & Changes (MAC) require request to
provider
Analog Signal vs. Data Packets
The fundamental difference between VOIP and PBX technology is the method of
transmitting audio information. In both systems, the sounds entering the receiver
are converted into signals. A PBX uses either analog, transmitted in wave format or
digital signals, for digital phone equipment. VOIP uses data packets – small pieces
of information encoded and transmitted via Internet Protocol (IP), the widely used
standard for encoding and transmitting data over the Internet or other IP-enabled
networks.
Key Differences Between Hosted VOIP and Traditional PBX | 4
PBX TECHNOLOGY
PBX Technology
A Private Branch Exchange (PBX) is designed to provide phone service to a group
of people without purchasing independent lines and features for each user from a
telephone service provider. It acts like a Public Switched Phone Network (PSTN) on a
small scale, allowing organizations to use extensions and share a common connection
to the PSTN. When calls are made, they are interpreted and rerouted by the PBX to
another internal number via an extension or to an external number via the PSTN.
Many standard office phone features were developed on traditional PBX systems,
such as call routing, auto-attendants, user shortcuts, voicemail, fax-integration and
countless others. PBX are capable of connecting complex applications, like call centre
systems that enable large scale call management or Integrated Service for Digital
Network (ISDN) systems that enable digital data to travel over traditional landline
networks.
Major PBX Components
•
Telephone Trunk Line – Multiple shared phone lines for each user
•
Computer – Manages call switching, routing and other features
•
Maintenance Console
•
Specialized Applications (e.g. Call Center, ISDN, Conference System,
Auto-Attendant)
Specialized Applications
In order to add new features to a PBX, additional hardware and software systems
have to be installed. A call centre application, for instance, has to be purchased from
a vendor and integrated with the PBX by the office IT staff. Any specialized function
requires a system addition, followed by ongoing updates and upgrades for
continual use.
PBX End-Of-Life (EOL)
PBX phone systems, like other on-premise networks, eventually reach their End-ofLife (EOL). This indicates when a particular model is no longer in production or when
support from vendors and manufacturers has ended. In many cases, the system can
continue to operate as normal, becoming an issue only once repairs or updates are
required. While the EOL date is not always pressing, it marks the beginning of the
system’s decline and the need to explore new options. EOL usually occurs between 5
and 10 years after the product’s launch.
Key Differences Between Hosted VOIP and Traditional PBX | 5
HOSTED VOIP TECHNOLOGY
Hosted VOIP Technology
Voice Over Internet Protocol (VOIP) converts analog signals into data packets that can
be transmitted over the Internet or any other Internet Protocol (IP) enabled network.
Internet Protocol is the standardized method of communicating between locations
and structuring data over digital networks. Each packet is encoded with the receiver’s
address and instructions like other forms of data including emails or web pages. By
sending the voice data over the Internet or a dedicated network connection, the Public
Switch Telephone System (PSTN) and traditional phone carrier play a less significant
role in placing interoffice calls, inter-company calls or long distance calls.
Hosted VOIP uses the same principles of transmitting data, but combines other
breakthrough in communication technology — Cloud Computer and Broadband
Networks — to offer the services and applications in a very different way.
Cloud Computing
Cloud Computing is a general term for a number of different services and applications
that can be delivered over the Internet instead of developed at the location of the user.
Many things today use cloud technology to offer software subscriptions, server space
or virtual networks. Cloud-based services rely on centralized servers that perform a
particular set of functions and then broadband network infrastructure that deliver it to
customer locations as a simplified service.
Broadband Networks
Broadband refers to high-speed and high-capacity data networks and data-handling
techniques. The development and proliferation of broadband has allowed residential
and commercial users to use increasingly complicated and data-laden services at
sustainable costs. Broadband connections, including cable, DSL and fiber optics,
allow Internet Service Providers to stream “high-bandwidth” voice data with fewer
quality issues. Hosted VOIP services combined with a fiber optic connection can offer
applications like video-conferencing for entire offices without sacrificing the quality of
service.
Key Differences Between Hosted VOIP and Traditional PBX | 6
SOF TSWITCH TECHNOLOGY
Softswitch Technology
An advanced software platform, known as the softswitch, functions like a remote PBX
system. As the “brains” of the Hosted VOIP network, it handles call routing, switching,
advanced applications and enhanced features for the provider’s entire network.
Through various built-in or add-on capabilities, the provider can offer on-demand and
customizable service.
The complexity of the softswitch will largely determine the capabilities of the Hosted
VOIP service provider. Some providers opt for a basic softswitch that provides
fundamental phone services that a traditional PBX would, without the hassle of
managing it internally. Providers with advanced softswitches have many more
features to offer clients, including upcoming technologies in the telecom market.
Quality of Service (QoS)
VOIP has struggled with quality issues since it first became commercially available in
the 1990s. It proved difficult to achieve the same audio quality and consistency with
data packets and IP-enabled packets, especially during peak traffic periods.
Since, VOIP developers and providers use VOIP-specific Quality of Service (QoS)
standards that measure the transmission of high-bandwidth applications in order to
better manage network performance. QoS standards are used to shape and prioritize
data to increase, predict and guarantee network performance.
Cisco QoS Standards Evaluate:
•
Bandwidth Requirements
•
Packet Classification
•
Queuing
•
Traffic Shaping
•
Data Compression
•
Frame Relay
Private Network & Public Internet
Connection quality directly influences Hosted VOIP voice quality. One reason is that
voice data is “high-bandwidth,” meaning that it can disrupt a standard connection
if it not managed properly or if there are too many users. Private connections also
influence service quality by providing voice data with a distinct pathway between calls
instead of traveling various pathways across the Internet.
Key Differences Between Hosted VOIP and Traditional PBX | 7
MAINTENANCE AND OBSOLE SCENCE
Data Connectivity - Main Differences
VOIP over Private Network
VOIP over Public Internet
Guaranteed Voice Quality
Standard Voice Quality
Controlled Data Routes
Data Travels Unpredictably
Uptime Guarantee
“Best Effort” Service
Service Level Agreements & Private Network Connections
Voice quality and network uptime can only be guaranteed if the Hosted VOIP service is
deployed via a Private Network. The added control of the private connection makes it
possible to guarantee performance standards that match the reliability of traditional
PBX phones. Hosted VOIP services offered over a generic “best effort” connection can
only be as reliable as that network. A “best effort” service increases the chances of
network and voice disruptions for organizations with many users, continual usage or
data-driven applications.
Maintenance & Obsolescence
Hosted VOIP providers can absorb maintenance and update expenses for all of their
customers without incurring major costs. Issues can be detected and resolved offsite
from the cloud facility, just as updates and upgrades can be focused on the softswitch.
Changes made to the central network in turn effect client networks, providing
simplified network maintenance, continually updates and system-wide upgrades. This
is often an included part of the service, alleviating operational expenses and the risk of
system obsolescence.
Key Differences Between Hosted VOIP and Traditional PBX | 8
COST COMPARISON
Cost Comparison–PBX vs. Hosted VOIP
The savings associated with Hosted VOIP services come directly from the advantages
of the technology; every aspect of an office network can be treated as a service,
allowing the provider to absorb operational and maintenance costs by managing
a single cloud network for countless clients. The client can deploy up-to-date
functionality without the risk and effort of investing in an advanced system.
The results are reduced capital expenditure and operational expenditure. Depending
on the businesses’ current system and particular needs, savings can fluctuate
between the two, but are often possible in both areas. PBX systems, by comparison,
often demand large upfront investments as well as ongoing maintenance in the form
of IT efforts or contracts with PBX vendors. In most cases this translates to more
investment and attention for less functionality.
Epik’s Total Voice vs. Nortel PBX
A comparison of Epik’s Hosted VOIP service and a client’s current Nortel PBX. The
Hosted VOIP service creates 18% savings over 36 months, with the possibility to easily
adjust services and applications along the way.
Figure 1
Key Differences Between Hosted VOIP and Traditional PBX | 9
COST COMPARISON
In this case, the savings result from bundling the phone service with enterprise
Internet services from the same provider, and monthly VOIP long distance fees. There
would be a similar pattern with other voice applications, like conferencing or enhanced
features that would be more cost-effective and easier to manage with the Hosted VOIP
system (Figure 1.1).
Figure 1.1
The monthly savings would actually be significantly more as maintenance and update
costs are not always known in advance (an estimated 15-20%) but are includes in
Hosted VOIP services since the system is managed offsite (Figure 1.2).
Figure 1.2
Key Differences Between Hosted VOIP and Traditional PBX | 10
COST COMPARISON
As demonstrated below, businesses that prefer to purchase the onsite equipment —
routers, switches and IP phones — can pay more upfront instead of a monthly fee.
This means that businesses that take on the capital expense will still see significant
savings. Large capital expense is still compensated for by the monthly operational
savings of Hosted VOIP, saving the client 27% over 36 months (Figure 2).
Figure 2
In this example, it is clear how a specific voice applications (in this case conferencing),
long distance and maintenance add up to significant savings. Each of these is
inherently more cost-effective than the PBX equivalent because of the underlying
technology.
Figure 3
Key Differences Between Hosted VOIP and Traditional PBX | 11
COST COMPARISON
Conclusion
Comparing traditional PBX systems to Hosted VOIP technology is becoming more
and more of an “Old vs. New” story. The core technological differences and the dropoff in future potential put them in practically different categories altogether. Heavily
invested in PBX systems and general office complacency make it difficult to transition
out of traditional telephony, even as employees continue to adopt and develop work
behaviours in relation to high-tech personal and consumer technologies.
The proliferation of VOIP, cloud computing and broadband networks have made
advanced IP telephony widely available and affordable, even more so than standard
PBX networks. Businesses looking for a new system should reconsider what comes to
mind when they think “business phone system,” because for many companies it is the
last barrier between their operation and today’s telecommunications.
About Epik Networks
Epik Networks is the industry leader in advanced data and communication services,
offering turnkey solutions for almost a decade. Through centralized Broadsoft
softswitches and high-speed fiber-optic connections, Epik Networks provides
companies of all sizes with highly customized telecommunications solutions that are
both affordable and completely reliable.
We take care of everything from the hardware and software, to ongoing maintenance.
You will never worry about your voice services again. In addition to all the equipment,
Epik Networks offers one easy-to-understand bill.
Let us show you why over 8000 users have made the choice to use Epik Networks as
their service provider.
Feel free to call us at 1-866-353-9333. Epik sales consultants are standing by to help
guide you to make the best possible decisions for all your telecommunication needs.
epiknetworks.com
Epik Networks Inc. Head Office
[email protected]
80 Bloor St West, Suite 503
Toronto, Ontario, M5S 2V1
Toll Free: 1-866-353-9333
Phone: 416-921-7000
Fax: 416-855-763
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