VoIP or Voice over Internet Protocol is a new entrant to the telecommunications media. In VoIP your voice is transferred across a broadband Internet connection instead of the traditional public switch telephone network. You can say, o.k. fine, but why on earth should I switch from my present telephone system which is working so well to a relatively new technology called VoIP?

While considering VoIP for my use I too had the similar question. When I studied VoIP in detail, then only I could understand the technology as well as its advantages. VoIP is more efficient than your traditional phone system in many ways like:

Cost effectiveness: Low costs are the main reason for switching from traditional phone system to VoIP. You can avail all the features and benefits associated with VoIP at a low monthly fee. Depending upon your VoIP services provider you can also make free calls on some numbers. There are no associated fees for VoIP phone services as there are with traditional phone network.

Portability: VoIP has a portable system. You can use it permanently at your house, or you can travel along with it. All you need is access to a high speed broadband connection. You can choose any area code as per your convenience. This means you can choose an area code where you frequently make calls and the calls will be charged as local calls.

Flexibility: The VoIP system is highly flexible which means that it can adjust well to your personal needs. If you need more lines you can upgrade your system at low cost and vice versa.

Added Features: - Most of the added features on traditional phone networks are charged heavily. These features are charged as per your normal rates in VoIP systems. The included features can be call waiting, caller id, voicemail, call routing, tele-conferencing, and video-conferencing etc.

These are some of the reasons which compel you to switch to VoIP network from traditional phone line. So, if you want to talk freely with your kith and kin then switch to VoIP services and enjoy the pleasure of talking freely at limited costs.

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The words are; cost effective, portable, and flexible. And hey it comes with array additional new features too! No it is not our regular PSTN phone connection. The buzz word here is; VoIP phone systems.

It is the technology that transfers your voice from over the internet using specially designed call signal protocols in a much efficient manner. Efficient in terms of its low cost, the number of additional features that it offers, the convenience with which the call can be placed from anywhere at any time and for as long as you want!

The advent of the internet, bought the world closer. And it swept each one of us by our feet and today we are completely dependent on it for our day to day activities. Walking a step closer VoIP system has been developed! And it will completely revolutionarise the traditional way of making phone calls.

It's smart, convenient, cost effective and absolutely relevant with the times we live in. How much on an effort is it, to switch on your laptop and make a call! Practically nothing! While at the same time it offers us a chance to talk for as long as we want without having to worry about the long bills!

Traditional analogue phones are a lengthy network of wires used to facilitate calling from one end to the other, and while a call takes place that particular wire system is dedicated to that one call. This is the reason; phone bills are higher on international calls. While VoIP Phones System work on the broadband connections. Once a call is dialed the analogue voice data is converted into small packets of digital audio data and transferred using special internet protocols from one end to the but delivered to the person in a comprehendible analogue format

Truly VoIP telephony is a step above the traditional phone lines and not far from now it would completely change the way we make long distance calls!

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There are so many ways that a VOIP Hosted PBX can save you money I can't begin to cover them all in a short space. However, here a few of the major cost saving aspects of a VoIP Hosted PBX system:

Cash Flow - Controlling cash flow is a major factor that determines the ultimate success or failure of any business, regardless if you are a start-up or an established business. Tight control over capital expenditures and operating expense is essential. On average, a VOIP Hosted PBX costs 20-40% less than a premise-based PBX. Also, CAPEX is minimized because you don't have to "Buy the "Box".

Additionally, because of the way premised based PBX systems are designed, you have no choice but to buy more equipment than you actually need to support your current requirements.

Sounds crazy, but it's true. Why spend precious dollars now on equipment you won't need until six or 12 months later or longer? A VOIP Hosted PBX allows you to pay as you grow. In other words, you only buy what you need to support current requirements.

Adding new employees to the system is fast, easy, and cheap. More importantly, you don't have to pay for something until you actually need it.

If you are ever affected by a downturn in business, a VOIP Hosted PBX gives you the flexibility to reduce your expenses accordingly by reducing your telecommunications requirements with no penalty since you only pay for what you need, when you need it. Generally, you cannot do that with a traditional premise-based PBX without incurring some form of financial penalty.

Moves, Adds, and Changes - Unlike a traditional PBX, in a VOIP Hosted PBX environment, Moves, Adds and Changes do not require an on-site technician to make changes to your phone system. A VoIP Hosted PBX can be remotely configured by the provider, thus providing you with the flexibility to add, change, delete or move users within hours instead of days.

Eliminating costly monthly maintenance contracts will reduce your expenses because there is no need for a technician to visit your location every time you want to make a change. This is done remotely by the VOIP Hosted PBX provider, which also gives you with greater flexibility to respond quickly to changing business or market conditions.

Significantly Reduce Depreciation Losses - Traditional PBX systems depreciate almost 70% the day you install them. With VoIP Hosted phone service, you won't have to worry about depreciation since you're not purchasing equipment.

Although there are many other reasons that a Hosted PBX can save you money, such as reduced maintenance, elimination of the need to track and implement software patches, no requirement to maintain PBX equipment inventories, no vendor finger-pointing, and faster trouble resolution, the overall savings can be summed up by considering the Total Cost of Ownership of a traditional PBX compared to that of a VOIP Hosted PBX.

In the December 2005 issue of Business Communications Review, Ken Dolsky and Warren Williams of InfoTech published an in-depth analysis comparing the TCO/ROI of a Hosted PBX to that of a premise-based IP PBX for a single location with 50 users. They concluded for most instances, the Hosted PBX environment was the clear financial and performance winner. Even though their analysis shows a significant opportunity to reduce costs with a VOIP Hosted PBX, it is important to point out that the analysis did not not take into account large savings associated with increasing employee productivity and revenue using the Hosted PBX's advanced features.

Here's another piece of advice.

When you replace your traditional PBX with a VOIP Hosted PBX system, then plan on buying a bigger piggybank, too.

Bill Casey is the VP of Marketing for Reignmaker Communications, headquartered in Atlanta, Georgia. They offer Hosted PBX service.