In the first article in this series, I discussed what converged networking looks like and told you that VoIP has the potential to offer you tremendous savings.  I’m sure you are very interested in this topic, so I’m covering it in an article all by itself.

There are many ways VoIP saves you money.  Here is a list of the money-saving items we will cover in this article:

1. long distance charges


2. setting up your own phone infrastructure between sites you own


3. leasing DIDs instead of phone lines


4. providing services directly to your employees


5. providing your own voicemail


6. reduction of conference call charges

These six items will directly save you money.  I will go over each of them in detail in this article.

As a bonus, I’m throwing in a little something extra.  It is an MS Excel spreadsheet that has the formulas worked out to show how much money you can save and how long it will take to get a return on the investment in VoIP equipment you will have to make. You can download the VoIP Savings Calculator Spreadsheet by clicking on this link.  You might want to fill in the spreadsheet with statistics for your company as you read.

For purposes of this article, I’m assuming you are a small company that has a few employees.  Don’t feel like you are left out if you are a home user or a business that is too small to afford the equipment you need to put in your own phone infrastructure.  In a later article, I will tell you about companies that lease service on their VoIP infrastructure.  You may not save quite as much, but you can still save big money by leasing service from these companies.

I know this particular article will generate a lot of questions.  I will do my best to answer any questions emailed to me by creating an article from those questions.  I cannot send personal responses to everyone.  If VoIP looks like the correct route for you to take, please hire a local VoIP consultant.  I will provide references in this article and later articles that have pointers to qualified consultants.

Long Distance Charges

Long distance is the number one area where you can save money.  The national average for long distance services in the US is 5¢ per minute.  You can search and find many companies on the internet that are willing to offer you much lower rates.  I use a rate of 1.7¢ per minute because it seems to be the going retail rate for SIP minutes between points in the US at the time this article was written.  I will do a later article comparing services available from SIP long distance providers that will cover this and other subjects in more detail.

Site to Site Long Distance

Some companies have multiple locations with employees in each location.  If you find yourself in this situation, you are probably tired of having to pay long distance charges between your sites.  You might even have to rent a PBX for each site.  This is an area where VoIP can really help out.  If you decide to deliver your voice calls over the Internet, you can drop your long distance charges to nothing.  This is true even if your locations are in different countries. 

Leasing DIDs Instead of Phone Lines

I guess I first need to explain what a DID is.  DID stands for Directed Inward Dialing.  This is an old phone company term that was used to indicate numbers that were routed through the internal networks of large companies that could afford to install their own equipment.  This was a way for people who could afford to lease their own lines to save money by using their own private infrastructure to distribute calls within or between sites they own.

DIDs become important to any company that wants to cut back on the number of phone lines they lease from the local phone company.  By leasing a DID (normally from your SIP long distance provider), you can have calls terminate at your provider, who will forward these calls to you across the internet.  You can have any number of lines you would like, so long as your Internet connection can handle the traffic load.

DIDs cost a small fraction – normally less than 10% - of what it costs to lease a phone line.  This makes DID leasing exceptionally attractive.  For this article, I am using $7.00 per month per DID, because that currently seems to be the going rate.

Providing Services Directly to Your Employees

As I mentioned above, it is possible for companies to lease service on their VoIP phone equipment to others.  It probably won’t be practical for your business to do this, but it should be practical to provide phone service to your own employees.  I will make a couple of assumptions here:

• You are paying for broadband internet access for your remote employees


• You are paying for your remote employees to have a voice line in their home office

If these assumptions are correct in your case, you can save money by eliminating the voice lines in your employees’ homes and replacing them with VoIP lines connected to your equipment.  Even if you don’t provide broadband access to your employees currently, you might want to consider it.  In many cases, it is much cheaper to buy broadband internet access than to buy a phone.

Providing Your Own Voicemail

Most VoIP Telephony systems have some provision for providing voice mail.  You need voice mail for your employees.  Since this is included as a free feature, it will save you some money.  Most phone companies charge around $9.95 per voicemail box.

Providing Your Own Conference Calling

Conference calling is another big area where you can save money with VoIP.  By installing your own conference server, you can convert the approximately 20¢ per minute you are paying for conference calling now to the 1.7¢ per minute you would pay for service from your VoIP long distance provider.  You would have to lease additional DIDs to allow you to have sufficient capacity for you conference calls, but with such a large difference in costs you will still save a lot of money.

Case Study:  ACME Widgets

It is impossible for me to tailor this article for every person’s particular needs.  Because of this I am going to create a completely fictitious company, called ACME Widgets, which will be used for this article. 

Here are the statistics for ACME Widgets:

Here is the VoIP Savings Calculator Spreadsheet I filled out for ACME Widgets:

As you can see from this example, it is easy for the owner of ACME Widgets to decide to purchase VoIP equipment and services because it will take less than 5 months to get a return on investment.

Summary

It is very easy to save a lot of money on your telephone charges by making the switch to VoIP.  The most cost savings is realized by purchasing and operating your own equipment.  For smaller businesses or those that do not have time to study and implement a large project, it is possible to lease time from VoIP service providers. 

Additional References

The VoIP Wikipedia
Asterisk Wiki Listing of Consultants
SIP Express Router Consultants