Hosted VoIP Service: Is It Right for My Business?

When it comes to business, there are some things that never change. And the need for effective, reliable communication is one of them. While the form of communication itself looks completely different now than it did 100 years ago, businesses still rely today on constant communication, especially over the phone. (Despite what some millennials will tell you.)

Telecommunications has changed drastically over the years, but it still plays a vital role in business operations. Voice over Internet Protocol (VoIP) is “a modern technology that lets you make phone calls over Local Area Networks (LANs) or the internet.” VoIP has becoming increasingly more popular in recent years, but the technology behind VoIP has been around since the 1970s.

History of VoIP

Voice over IP made an early mark on the business sector in 1995 with the first widely available Internet phone. Since then, corporations have steadily adopted VoIP as a replacement for traditional landline phone service. VoIP works by transmitting voice calls via small data packets from one IP address to another, which differs from traditional telephone services that rely on cables or signals transmitted to towers.

Early VoIP solutions were managed by on-site equipment at each user’s location. Similar to how your business’s internet relies on an on-site modem and wireless router, hardware was installed in a server room or phone closest to provide VoIP services at a specific location. Now, hosted VoIP solutions offer the same benefits at a lower cost and with a simpler solution. VoIP hardware is hosted at the location of the service provider instead of at each user’s location. This newer twist on the service can provide major benefits to businesses that haven’t always been an option with VoIP.

Is Hosted VoIP Right for My Business?

When VoIP first became popular, it brought with it many issues to telephone communications that users weren’t used to facing. Slow connection speeds and poor sound quality caused many users to abandon the service early on; however, as technology has improved, so has VoIP, and now more than 60% of voice calls are made over VoIP.

Today, the cost savings alone of VoIP services compared to traditional telephone services make it seem like a no-brainer to use VoIP. But as with any business service, there are pros and cons to VoIP services. Every business has different needs, so whether VoIP is a good fit for you depends on how the pros and cons affect your business.

Pros of Hosted VoIP

Simpler setup and management: Whether you’re considering a jump from your traditional landline setup or from an on-location VoIP service, a major benefit to hosted VoIP is the quick setup. VoIP uses the same wiring as your internet, so there’s no need for a technician to run extra cables to support the service (which can sometimes take weeks to accomplish). Hosted VoIP can be up and running within a day.

Guaranteed 24/7 support: As with any business service, hosted VoIP services can function unexpectedly from time to time. However, choosing a hosted VoIP provider who offers 24/7 support (a common inclusion in most service packages) is a huge benefit.

Wide variety of add-on services: Whether your business could benefit from voicemail-to-email transcripts, automated call distribution, AI-powered interactive voice response, or other premium features, hosted VoIP is expandable based on your needs.

Mobility: Hosted VoIP calls can be taken on computers, cell phones, office phones, tablets, and other devices, which means you can be reached wherever you are.

Scalability: Adding and managing phone lines with hosted VoIP is very simple. Gone are the days of long installation times for new phone lines. Hosted VoIP users can be added/removed with a few clicks.

Cost savings: This is maybe the biggest selling point of VoIP services. The average business saves 40% on telephony expenses by switching to VoIP.

Security: Traditional on-site VoIP services are highly susceptible to hackers due to the service’s reliance on your internet connection and therefore the security of that connection. Hosted VoIP services rely on the security of your service provider, which virtually removes this concern altogether. As long as your service provider undergoes regular third-party security audits on their systems, you can trust your hosted VoIP calls are completely secure.

Cons of Hosted VoIP

Internet bandwidth requires: Hosted VoIP services require a stronger, higher speed internet connection, which can increase the cost of your internet services. Slower connections can cause internet users to experience slow load times when VoIP phones are in use. However, as long as your internet service provides enough bandwidth for simultaneous usage, this shouldn’t be a problem.

Dependability on internet connection: As is the case with bandwidth, this issue is inherent to any type of VoIP. Because VoIP relies on a stable internet connection, a loss of connection means loss of phone service. However, most service providers now offer call routing to voicemail or cell phones so that outages don’t result in missed calls.

No location tracking for emergency calls: Because of the way VoIP works, emergency services like 911 aren’t able to track the location of calls. This most likely won’t affect your day-to-day operations, but it’s a good thing to keep in mind.


At the end of the day, committing to a hosted VoIP service plan is a big decision. While the pros and cons are always worth considering, for many business owners, there are other factors to consider. If you’re interested in hosted VoIP, reach out to us today. We’d be happy to talk you through whether hosted VoIP is a good fit for your business and help you choose a reliable service provider.