Growing Your Business

VoIP for Small Businesses: A Look at Its Incredible Potential and Possible Pitfalls

VoIP for Small Businesses:  A Look at Its Incredible Potential and Possible Pitfalls

New technologies can feel like magic.

VoIP, or voice-over-IP, is just one of a thousand micro-miracles that came from the internet, but it’s still mind-blowing what it lets you do with a desktop phone and a small piece of the cloud.

If you’re itching for some new tech magic at your small business, VoIP could make for an awesome step forward. Keep reading to learn how VoIP can help your business and when you should take the plunge.

What Is VoIP?

VoIP is to a business what Skype or Google Hangouts is to anyone with a smartphone.

Instead of pinging cell towers, a smartphone owner can use an internet-powered app to call or video chat friends and family.

And instead of using a landline connection, a business can use internet-powered software (VoIP) to manage calls from desktop phones, computers, and mobile devices throughout the office.

How can VoIP help my business?

VoIP can be helpful for any business because it’s cost-efficient and user-friendly, and it can help improve efficiency and productivity.

But small businesses tend to have smaller budgets, employ smaller staffs, and outsource specialized work more often, and they therefore stand to gain even more from combining infrastructures. Here’s how:

1. VoIP can help small businesses save money.

To stay competitive today, even small businesses need more than basic phone service. But simple landline packages often don’t include standard features like multiple lines, long-distance packages, and more.

VoIP not only mimics or recreates these extra features but also enables new capabilities, like switching mid-call from your handset to your cell. Plus, with VoIP, you can skip the landline phone bill and pay a better rate for the same—if not better—features.

On the flipside, you may have to make an up-front investment in VoIP-optimized hardware. But since VoIP is compatible with lots of devices, your investment level is up to you.

2. VoIP is user-friendly so small businesses can easily manage their own systems.

VoIP doesn’t need as much maintenance as a traditional phone system because there’s just one installation and set of network equipment (routers, switchers, antennas, etc.).

That takes some of the fuss out of your phone installation, but the benefits go far beyond that. VoIP has an incredibly user-friendly interface so you can tailor the settings to your company’s evolving needs without relying on a regular IT presence.

3. VoIP has productivity-enhancing features that are impossible to replicate with legacy phone systems.

Here are a few examples of common VoIP features you’ll find today:

  • Built-in conferencing. Conferencing lets you easily connect with customers, partners, and contract employees. You can have more productive virtual meetings and get projects moving more quickly.
  • Remote call-and-answer. VoIP lets employees answer calls to the business from their own home or cell phones. This is super helpful for small staffs, with employees who may wear multiple hats and need more flexibility than most.
  • Sophisticated call routing. VoIP lets you get incredibly granular with call forwarding. For example, you can have calls forwarded to your cell phone if your desktop phone rings three times and you still haven’t answered, or you can have someone else’s phone ring if your only customer service rep is on a call.
  • Auto-attendant. VoIP has a built-in menu that immediately sends a professional image and helps callers easily find the extension they want.
  • Visual voicemail. Voicemails are automatically transcribed and emailed so you can focus on the content and organize them for later analysis.
  • Training tools. Some VoIP systems have a feature that let supervisors eavesdrop on a live call and even give spoken advice to the employee—without the customer being aware.
  • Data reports. With VoIP, you can now track data just as easily as you track it across your websites. You can get detailed information about bandwidth use, call time, and more—and use this data to improve your products and services.

VoIP is all cloud-based, so theoretically, if there’s a feature that can be coded, it can be added to a VoIP system.

While managing thousands of custom features isn’t practical for most providers yet, the code-ability of VoIP bodes well for businesses everywhere.

Why can’t my employees just make internet calls with their own Google or Skype accounts?

They can. But for doing business, VoIP has clear advantages over single-user accounts:

  • Business-class functions like call routing, auto-attendant, etc.
  • Streamlined troubleshooting and training, since settings are system-wide
  • Consistent, professional image to customers and business partners
  • Hardware options that are tailored to multimedia use

Are there any downsides to VoIP?

Since VoIP is internet-powered, it’s more vulnerable to internet connectivity problems than legacy phones are.

But VoIP can be incredibly reliable, and it’s actually easy to ballpark how reliable it can be for you: it all comes down to the speed and reliability you get from your internet provider.

Here’s a quick guide on the three main types of internet connections and their ability to support VoIP.


DSL internet can offer speeds up to 30Mbps in some areas. That speed is theoretically enough to cover the 6Mbps a single user needs to have a decent-quality video call.

The problem is, 30Mbps isn’t available everywhere, and even in a small office there may be more happening at once than a single video or voice call.

One silver lining, however, is that the data hubs sending signal to your building give you a fixed bandwidth. That means you get the speed you paid for and that no matter how many of your neighbors have the same provider, their traffic won’t affect your bandwidth in any serious way.

Verdict: The higher your speed and the smaller your staff (up to 5 workers), the more likely you’ll be able to get reliable VoIP service over a DSL connection.


Cable can provide higher speeds than DSL, in some areas as fast as 150Mbps. On paper, that’s more than enough bandwidth to cover the doings of a small business.

The downside is that the bandwidth is sent en masse. Cable providers are less able to control how much actual bandwidth reaches each customer, so you can pretty much count on lag during peak usage hours.

It is possible to prioritize your traffic so the phones get bandwidth first. That’s good for your customer service reps—but not necessarily for overall productivity, since all other internet activity will be hit harder.

Verdict: VoIP is workable if you have a cable provider. Just know that to get more bandwidth during peak hours, you may be looking at a higher internet bill.

100% fiber-optic internet

Fiber internet gives you higher top speeds than cable can reach—in some areas, you can get business speeds as fast as 500Mbps.

Even at the relatively lower speed tiers, though, a small business can easily expect the bandwidth they need to support all their devices and the VoIP system itself.

That’s because fiber is also more reliable. Cable uses a ton of copper wiring, which burns data as heat on its journey to your building. Add that to the shared bandwidth problem, and you’ve got relatively high speeds but over a connection you can’t always trust.

Fiber, on the other hand, sends information in pulses of light that stay intact from the source to the end of the connection. That means you don’t lose packets as often and that they arrive at a consistent pace.

Although fiber is not technically a private connection, the technology is so efficient that it will feel like one anyway.

Verdict: Fiber doesn’t just support VoIP—it supercharges it.

Is it time to get VoIP?

Fiber, cable, and sometimes even DSL have the potential to support VoIP for small businesses.

But if you have frequent outages or don’t get the speed you want, don’t jump on the VoIP wagon yet. Call your internet provider or research other companies with the bandwidth and reliability you want.

If VoIP still won’t work for you, just remember that fiber is becoming more common, especially for business use. By the time you get fiber, VoIP could be more advanced and bandwidth more affordable.

Stay hopeful! Your day will come.

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Frontier Communications

Frontier Communications

Frontier Communications Corporation, now a Fortune 500 and S&P 500 company, is a leader in providing communications services to urban, suburban and rural communities in 29 states. Frontier offers a variety of services to residential customers over its fiber-optic and copper networks, including video, high-speed internet, advanced voice and Frontier Secure digital protection solutions. Frontier Business Edge offers communications solutions to small, medium and enterprise businesses. Frontier's approximately 29,000 employees are based entirely in the United States. More information about Frontier is available at

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