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A couple of years ago, I wrote about the Voice over IP (VoIP) services that were appearing at that time (e.g., Vonage, etc.). Since we are moving offices, we had reason to look at replacing our aging office telephone switch and we thought we would see what the state of VoIP is today. For many small businesses, going with a commercial or open-source VoIP switch seems attractive. They are about the same or even lower cost than many traditional PBX switches but they have some new features that are easier to use and program. These include slick things like automated voice message forwarding to email attachments as wav files.

Our old switch has all the basic functions (forwarding, parking, voicemail) but it was a major pain to learn to program for the poor soul in charge of it. The learning curve is steep enough that we only have one guy who can program it. On the other hand, the VoIP switches have a much friendlier computer interface that appears simpler to program and use, at least for our computer-using crowd. It also has features that our old switch just can’t match. At this point, I’m not sure how much we would use all these features but they do seem sexy.

The way these types of switches work is with special VoIP handsets (telephones) as well as with “softphones” or computer-based software phones. So, you can make a call with a traditional feeling telephone handset or through software on your computer (with a headphone/speaker and mic). The switch handles call routing and the various switch features. Calls can be made entirely over the IP network (if you’re calling another Internet phone) or it will travel through the network until it goes through a gateway to the traditional telephone network and eventually, a normal phone or cell phone. One of my sticking points is understanding how long the call remains on the IP network vs when it goes to the traditional telephone network.

While IP based calls are the least expensive, they are still typically of poorer quality. At least if your call is outside your own switched network. While we have high bandwidth locally, it becomes a “best effort” game on the Internet and the bursty nature of the packet network is not geared towards high quality real-time conversations. That was very clear even a year or two ago as quality of service for most services like Vonage was rated worse than cellular for dropped calls, latency, and jitter. Now, more commercial providers like cable companies, AOL, ATT, Verizon, etc. have joined the scene. They can improve some quality components because they control more of the network structure and can use Quality of Service parameters on the parts of the network they control. Other downsides can be services like 911 (an extra cost item usually) and emergency service when power is down (in a traditional phone system, the central office powers a normal phone over the telephone line so it works even if your house/business power is out).

Different businesses, like individuals, can tolerate poorer quality of service if the costs are significantly reduced. Others find it a rude shock since traditional phone service has been so reliable and high quality for so long. We are trying to determine our own needs and what we are willing to trade-off. One of the aspects we are examining is where and when calls would pass through a gateway back onto the traditional telephone network. That network supplies virtual switched circuits to the endpoint with dedicated 64kb bandwidth. It may be that we end up going with a weighted hybrid solution for now: VoIP for the local office network but quickly routing the calls through a traditional gateway for higher quality service. We can always change the call routing later if quality improves. Or, we may start with more VoIP and if the quality seems alright, we’ll just stick with it.

For your business, consider these factors and try to run a pilot program with VoIP if you can afford it. It should help you to determine what your business needs and tolerances really are.

Lee Le Clair is the CTO at Ephibian. His Tech Talk column appears the third week of each month in Inside Tucson Business