Complete Guide to Hosted VoIP

The introduction of VoIP technology in the 1990s was accompanied by a fair amount of hype. However in those early days, the technology didn’t always live up to the marketing claims.

Today, it’s clear VoIP technology has become a pervasive, viable solution for business communications. Organizations of all sizes are migrating to both on-premises and off-premises solutions.

Since hosted VoIP appears to be gaining the most steam, this guide will focus on that model. Specific topics include:

  • What is Hosted VoIP?
  • How Does Hosted VoIP Work?
  • Hosted VoIP vs. Alternative Solutions
  • Is Hosted VoIP Right for Your Business?
    • Understanding the Advantages
    • Evaluating the Disadvantages

The information gleaned from this discussion will help you create a strong foundation of knowledge. As a result, you can evaluate whether hosted VoIP is right for your organization.

What is Hosted VoIP?

“Hosted” simply means the VoIP hardware and software are located off-premises in a service provider’s facility. You access a virtual solution that eliminates the need for a physical PBX at your location.

If the equipment is owned by your business, it’s likely housed in a provider’s data center colocation facility. In this model, you maintain your own equipment and the provider offers the space, power, cooling, physical security and other facility-related features.

However, in this discussion, hosted VoIP will refer to a third-party solution in which the service provider owns and manages all hardware and software. The hosted VoIP model eliminates capital expenditures for equipment purchases. Instead, the service provider’s customers typically pay a monthly fee for the hosted voice communications solution.

How Does Hosted VoIP Work?

Hosted VoIP simplifies business communications. You don’t have to do any of the heavy lifting associated with installing, managing, maintaining and upgrading equipment. The provider’s solution will process your calls. Your phone calls will be routed over an IP network and/or the Public Switched Telephone Network (PSTN).

Using an IP phone or a traditional phone with an adapter, analog phone calls are converted to digital data packets. These packets are routed over an IP network to the provider’s IP-enabled PBX. The IP network can either be the public Internet or a private network based on Internet Protocol.

When the packets reach the provider’s IP-enabled PBX, they’re either routed to their final destination via an IP network or the PSTN. They’re converted back to analog voice signals when they are transmitted over the PSTN and/or reach their final destination.

Hosted VoIP vs. Alternative Solutions

The main options available to businesses for their voice communications involve both on-premises and off-premises solutions. For on-premises solutions, you can choose to own either a traditional legacy PBX or an IP-enabled (SIP interface) PBX. Either option resides at your location. You are responsible for purchasing and maintaining your on-premises equipment.

For off-premises solutions, you have the option of owning your equipment and housing it on-site in a data center colocation facility. In this model, you’re still responsible for purchasing and maintaining your equipment. However, you transfer the facility responsibility to a service provider. You purchase space, power, cooling, physical security and other facility-related capabilities.

The other off-premises solution is hosted VoIP. For a monthly fee, you can access complete business voice communications. Instead of you purchasing expensive hardware and software, the service provider makes the investment. The provider installs, manages, maintains, repairs and upgrades all technology and network components.

The best model for your organization boils down to a number of factors, including cost, control and capability. How much do you want to invest in your business voice communications? How much control do you want to maintain over hardware and software? What features do you need to access and how much will they cost in each model?

To make the right decision, you must answer these questions and more. By educating yourself on the benefits and challenges of the available options, you’ll be able to increase the chances of earning a solid return on your investment.

Is Hosted VoIP Right for Your Business? Evaluating the Advantages and Disadvantages

Since many businesses of all sizes continue to migrate to hosted VoIP, the strengths and potential challenges will be discussed for this model. In many situations, the advantages of hosted VoIP will surpass possible disadvantages. However, understanding the pros and cons will help you decide if hosted VoIP is best for your business.

To access an in-depth list of known advantages and potential disadvantages, download FairPoint Communication’s latest guide titled “The Complete Guide to Hosted VoIP.” This new resource will provide valuable information to help you make the best decision about your business voice communications.

Why Consider FairPoint Communications for Your Hosted VoIP Solution

FairPoint Communications helps businesses of any size get the most from their voice applications. As a hosted VoIP provider, FairPoint’s solution delivers a powerful, feature-rich phone system for small, medium or large businesses. Major advantages of FairPoint’s hosted VoIP include customized configurations, robust calling features, enhanced flexibility, end-to-end reliability, comprehensive support, a superior network, seamless integration and competitive pricing.

FairPoint Communications is the seventh largest local telephone company in the United States and a leading provider of hosted VoIP solutions. Since its beginning in 1991, FairPoint’s focus has been on using technology to offer new ways of communicating and serving the unique needs of customers.

To arrange a free, no-obligation consultation or request a complimentary demo, contact FairPoint Communications at 1-866-984-3001. For more information on hosted VoIP or other FairPoint solutions, visit our website.

Chris is the former Vice President of Product Management at FairPoint Communications, a leading provider of advanced communications technology in northern New England and 14 other states across the U.S.