What is VoIP? Save money by placing telephone calls over the Internet

Issue May 2009

by John A. Stone, co-founder
TCG Network Services
[e-mail jstone]

Voice over IP explained
By now, you may have heard about Voice-over-Internet Protocol (VoIP). But if you are like many lawyers, you still are not clear on what it could mean for your practice. Knowing the facts can help you make an educated business decision about this technology.

VoIP defined
Voice-over-Internet Protocol essentially transmits conversation into data. VoIP services convert your voice into a digital signal that can travel over a data network, like an e-mail you send. VoIP is incorporated directly into your business’ data network using your network cables and becomes a seamless part of your infrastructure. It is a telephony standard that has proven to be extremely cost efficient as well as powerfully productive.

So what do you need to know about VoIP?

Here to stay
The most important thing to know is that VoIP has hit Main Street and is no longer considered an emerging technology, but an established standard. Telephone system technology is now run by servers, not screwdrivers, as IT professionals play an ever-increasing role in its implementation. The overwhelming majority of new business telephone systems are VoIP-based.

Cost reductions
VoIP offers considerable cost savings in long-distance charges since calls are made over the Internet, especially for firms with multiple offices or significant long-distance calling.

Other cost savings come from the scalability of VoIP technology. Traditional phone systems require users to pay for any changes or upgrades they may need; for example, adding extensions when people are hired or changing extensions during reorganizations. With VoIP, the system is software-based and can be upgraded and changed to fit your needs easily. In fact, 90 percent of changes can be made by an office administrator with a click of the mouse or remotely by your vendor.

Since these systems are software-driven, investments in this technology are protected from obsolescence as new and custom features can be added easily to address needed functionality.
VoIP technology also adds business tools and enhances existing ones, providing more efficiency with business operations and leveraging your current technology investment.

Regardless of how VoIP is used, it lowers a firm’s total phone bill and its total cost of ownership by leveraging your existing technology investments like Internet, e-mail and even cell phones.

Continuity of business
Business interruptions can adversely affect the ongoing operations of any organization. Inclement weather, illness, security issues and other factors can all prevent access to your phone system and your clients. But with VoIP, just because your building closes doesn’t mean your business has to.
Productivity and continuity are maximized with VoIP, as users can receive all e-mails and handle live calls regardless of their physical location. Back-up and disaster recovery features ensure that important voicemail, data and programming are not lost in the event of a catastrophe.

Unified communications
VoIP allows users to have voice, e-mail, text, fax, chat and calendaring all in one place — wherever you are. By converging all of these communications tools, businesses are maximizing productivity, client service and client confidentiality.

VoIP delivers complete accessibility to contacts regardless of a caller’s location. When clients call, they can find you and have more options than simply leaving a message. Calls can be forwarded or screened seamlessly. Users can create a private message for a designated caller.

Powerful audio conferencing ability allows for easy scheduling, status checks on participants and more productive sessions. Presence management provides tighter collaboration between peers.
The ability to record calls and retain call records is a straightforward process, allowing firms to enhance operations and accountability and avoid potential legal and professional pitfalls.

Implementation options
The far-reaching advantages of VoIP are compelling businesses of all sizes to rapidly embrace this technology. While researching and evaluating the many product and service options available, key decisions related to the organization’s business drivers, corporate culture and company policies need to be made.

During this process, perhaps the most important choice that management will face is whether to own or rent. There are clear advantages and downsides to both an on-premise (in-house) solution and an off-premise (hosted) model.

Hosted VoIP has lower start-up costs and then a monthly fee for each phone or user connected to the host. Other than phones and a special router, the system resides and is managed off site. This type of service runs exclusively over your Internet connection, helping reduce costs associated with land lines. The most popular productivity features are widely available with hosted solutions, but they are limited to the host’s feature set and generally cannot be changed. Hosted VoIP is a fixed monthly service provided on an annual contract basis, much like a traditional phone company.

In-house VoIP involves a capital purchase or lease, yet ongoing recurring costs are minimal. Businesses can utilize one or a combination of connections, including Internet, copper or digital lines. Features abound in these systems and additional functionality can be added through regular software updates. In general, companies have much more control over how the system works on a daily basis. In-house VoIP is a corporate asset that becomes part of your network.

VoIP technology has become mainstream, bringing the same tools that Fortune 500 companies use to small and medium-sized businesses. Regardless of the size of your organization, VoIP technology is now accessible, scalable and affordable.


Lawyers Journal regularly runs Mind Your Own Business, a column devoted to answering management questions that come up in day-to-day practice for solo and small-firm practitioners.