Is There a Difference Between Cloud-Based Phone Systems and Business VoIP?

Photo by Devin Pickell

Originally Posted On: https://www.lingo.com/2020/07/28/is-there-a-difference-between-cloud-based-phone-systems-and-business-voip/

Many modern-day businesses have been switching from traditional landline phone systems to newer cloud-based phone services, which utilize an internet connection to make phone calls and store information.

Cloud-based phone services have become very popular as of late, but there is another term you may have heard floating around lately: business VoIP, which stands for voice-over internet protocol.

These terms are often used interchangeably. If you’re like a lot of other people, you may be wondering what exactly the difference is between a cloud-based phone service and a business VoIP.

A cloud-based phone service utilizes the internet to transfer voice signals between IP addresses. It forgoes the use of on-premise hardware, cutting down on the maintenance costs of a traditional telephone line system.

This is how cloud-based phone services work:

1. Voice signals transform into tiny pieces of data for transmission through voice pockets.
2. The voice pockets travel through the internet to the sender’s VoIP provider.
3. The VoIP provider routes the call through cloud-based Private Branch Exchange.
4. The pockets convert back to voice signals upon reaching the receiver’s VoIP phone.

All of this cloud-based communication is possible because of the internet and internet protocol.

People often use buzzwords like “cloud-based phone systems” and “business VoIP” interchangeably — but how does the latter actually fit into cloud-based communication and call center systems?

Business communication has evolved because of the internet and internet-based VoIP services. The rationale for using a business phone system, however, is the same for businesses that switch to the cloud as it was for businesses that started out with traditional phone lines.

• Business owners use VoIP to cut down the cost of telecommunications without sacrificing the quality of calls and their accessibility to customers.
• Business owners also invest in a phone system to implement external calling and extension dialing on the same system.

Essentially, VoIP eliminates the need for wiring and the cost of hardware maintenance because it runs entirely on the internet. This feature of VoIP is why more businesses are transitioning to or opting for cloud-based business phone systems.

The short answer is, yes, they pretty much are. But there is a fine line between the two.

Cloud-based phone systems and business VoIP essentially have the same functionality. But if we were to go into detail, the cloud is where businesses pull up information and use the services from a VoIP server.

Additionally, the cloud turns any device with internet access into a potential phone. It integrates all the services of a VoIP server and more. These include extension dials, instant messaging, video calls, and voicemail management. As such, the cloud gives you a phone number for customers to call as well as collaboration features that streamline your workflow.

1. Cloud-based phone systems are a cost-effective alternative to traditional phone lines.

In addition to internet services, you only have to pay for the cloud system setup costs and the monthly payments. Local and international calls cost less because both course through the internet. And you don’t have to pay for hardware maintenance like you would for a traditional phone system.

2. Regardless of the size of your business, the cloud provides reliable and constant communication.

Whether you just opened an 8-person start-up business or a 200-employee company, you can rest assured that the cloud keeps communication constant. A cloud-based phone system is not tied down to a single location so you can communicate with customers and employees anytime and anywhere you have internet access.

3. A cloud-based phone system gives your company more room to reach out and grow.

The cloud lets you grow your phone system based on the size of your business. You can add phone lines and extensions without worrying about copper wires and on-site equipment that you would fuss over if you stick to traditional phone lines. As such, scalability is never an issue.

4. Gain more security from a cloud-based phone system than from a traditional system.

Fraud, phishing, and spoofing are the most common phone security risks. A cloud-based phone system pays close attention to these risks to improve security for you and your business. The cloud features various security measures like data encryption, network security, and voice and video security.

5. The cloud gives you mobility and flexibility without fear of cutting communication lines.

Cloud-based phone services gives you the freedom and flexibility to work anywhere there is internet connection. With the cloud’s accessibility through mobile apps, you can access cloud communication even when you are in remote locations. You can easily make and take business calls from home or during business trips.

6. Maintenance is not an issue and you don’t have to pay for hardware maintenance

Another great thing about cloud services is automatic updates and upgrades. You don’t have to worry about maintenance because your cloud-based phone system software automatically adds new features and downloads bug fixes.

7. Hosted cloud services give you more room to focus on growing your business.

Cloud-based phone services are usually hosted services. As such, the host addresses software malfunctions and hardware maintenance. All you have to secure are a stable internet connection and working IP phones — now, just focus on your business.

Cloud-based phone services aim to streamline your business process and make you more accessible to your customers. Secure your internet connection and take advantage of the cloud anywhere you go.

Come to Lingo for cloud-based phone services. We provide IP-based call center services for small and medium businesses. Contact us today for more information.