Businesses should examine all of the costs to doing business before considering switching to VOIP telephone service.

Small business owners face lots of challenges. Many of those challenges seem to center around staying on top of the latest technology and keeping costs in check. While any cost-cutting idea is worth considering, owners must consider more than just the bottom line when making decisions for their businesses.

Take telephone service, for example. Hosted IP Telephony, also known as Voice Over IP service, is growing in popularity. But VOIP telephone service raises several issues business owners need to consider.

Security: Because VOIP telephone service is Internet-based, it is open to the same security threats as the rest of the Internet, namely hackers and viruses.

Outages: VOIP phone services are also more susceptible to outages than traditional telephone services. An Internet outage or a power outage that shuts down the telephone system’s server also shuts down service. This comes into play especially during natural disasters and severe weather, when Internet and cellular services often get interrupted. Traditional wired telephones remain functional during a power outage, with the exception of wireless handsets.

Lost information: A VOIP call is broken down into data packets, like email and other Internet traffic, which are delivered to the receiving router and reassembled before being sent through the telephone. Service disruptions and high volumes of Internet traffic may result in packets being dropped or, in some cases, corrupted in transmission. The results can be choppy, garbled or even dropped portions of the conversation.

Don’t lose a powerful marketing tool

One critical component of a business telephone that needs careful consideration when evaluating VOIP services is on-hold messaging. On-hold messages are a valuable component of any company’s marketing platform. They keep callers engaged and on the line longer compared to silence when calls have to be placed on hold.

But a VOIP telephone system can present distinct drawbacks to strategic, creative on-hold marketing.

First, many Internet Service Providers will not allow files from third parties, like on-hold message providers, to be loaded onto a company’s VOIP network. If you currently have effective on-hold marketing in place on a traditional business telephone system, you could be forced to play generic on-hold music from your ISP if you migrate to VOIP without asking about on-hold messaging.

Second, those ISPs that will take a custom on-hold message require greater file compression, reducing the quality of the audio message. The current standard codec for VOIP audio is G729, which samples the audio at a rate of 8,000 times per second. By comparison, the G711 codec used for on-hold messaging on traditional phone systems samples the audio 64,000 times per second.