Repeater007, you do raise an interesting point. I am by no means a big fan of VOIP, but I do see that there are some benefits in using it. Granted, these benefits are more for a large office or corporate environment, but then these big businesses are the ones that are buying it. Most small businesses buying it are just trying to make themselves look like the the big boys. Here's my uneducated take on things and please, just take it for what its worth:
1. These entities already either pay for point-point data connections or MPLS infrastructures to handle their data traffic. This has been the norm since the 1960's. These very same connections can be used for inter-office voice calling if set up and managed properly; thus reducing the cost of long distance or dedicated circuits for voice traffic.
2. The supposed elimination of separate wiring networks for voice and data, although the jury is still out on that matter.
3. Corporate-level administration allows
less-than-fully educated Joe Schlotsky, the phone administrator, to manage the company's phone system from a central point. Phone doesn't work? They just overnight one to the site and let the guy with the manager pants (that don't fit) crawl under the desk and plug it in. There is no longer a need for technicians, dial-up connections, etc. for this purpose in their minds. If they build their private network properly, they might even eliminate the local telco from the equation. It's a fact of life that the local telcos cause many local service problems on their own without even trying. Customers jump at the opportunity to eliminate them from the loop, if possible.
I'm not necessarily buying these benefits yet myself either, but they are out there and someone is taking them into consideration.
4. The obvious huge tax savings. I think that's a big part of it. Think of the millions and millions of taxable long distance minutes for calls between offices that are gone. How about "far end hop-off" calls? There's a bunch of money being saved there in taxes alone and I'm guessing that it's billions of dollars. Think about companies with international offices alone. That's a lot of money being saved.
Still, even by adding up all of these benefits, there are so many more issues that find many people shaking their heads. VOIP offers many advantages, but the insane costs for hardware, software (including licensing), and the necessary infrastructure to support it still have a long way to go. Not to mention that most people marketing this equipment have no experience in the phone industry whatsoever. They see an IP phone as "just another client (their word for device) on the network". Anyone with half an ounce of sense knows better than that.
Of course, since almost all VOIP hardware is marketed by computer systems manufacturers, they are very accustomed to expecting their customers to pay annual licensing fees. That's been the norm with large computer networks for years, in fact it's even trickled down to end-user levels. Not so much with licensing fees, but the planned obsolescence of your program within a year or so. How many versions of Windows have you heard of, yet each time you bought (the right to use it), it was touted as the end-all of computer problems?
With traditional phone systems, you pay a few hundred bucks for each phone and you are done. Aside from paying for optional maintenance contracts, you use them until they die. Buy the same thing using VIOP architecture and you'll find yourself buying that same system over, over and over again with annual software licensing fees. Don't want to pay them? No problem......Your phones just stop working, or in a good case, they keep working but you can't dial any of the new area codes or exchanges that came up since your last license renewal. IP-based "systems" offer much more control over a business from outside parties, i.e: software manufacturers. They are legally there, they can legally cut you off and there's nothing you can do about it. You bought a license to use their software for a term. You never, ever own it and they can take it away from you, leaving you with a dumpster full of plastic things that look like phones. I know that there are some exceptions, but this is the norm from the "big three" VOIP players for sure.
Traditional (TDM) systems don't work that way. Once you buy them, you own them (unless you lease the system). You can use that system until it falls off the wall. You can sell it to someone else without registration or license transfer fees. Move it from Cleveland to Seattle: It will continue to work. If there are upgrades available, you can buy them from your dealer if you want. If you don't need or want them, you have the right to make that choice. If the phones don't work, or if you need more of them, you can buy more of them without paying annual "seat license fees". I could go on, but I think that you get my point.
Does an in-house system that's 100% IP make sense? Not to me, but what do I know? I have chosen to stick with what I know works for now, since it's really hard to convince a small business owner to spend 2-3 times the cost for a system with a handful of phones. Heck, I'd venture to say that about 80% of the features available on even the oldest phone systems never get used. Why pay more for a system that does the same, or even less?
Remember that VOIP is in it's third generation or "roll out". The first two times were miserable failures and the brunt of most VOIP jokes. It just didn't work, and to make matters worse, it didn't work for a second time. Part of the problem was, and still is, the fact that non-phone system equipment manufacturers are the ring leaders in pushing IP. They have a great idea, but they don't know what they are doing with it. "It should" isn't an acceptable term in the phone industry. The answer is yes, it works or no, it doesn't.
Sadly, most of the big telecom manufacturers are largely to blame for this split between industries. These companies sat back with the mindset of "letting the little kids play in the sand box" with them. None of the big boys started showing an interest in IP until about ten years ago. Hey, some of them still haven't taken it seriously. Now, they've let these little kids grow up and they are having to start flexing some muscle. Those "little kids" aren't so little anymore.
Like I said, the phone equipment manufacturers sat back and laughed at the new kids on the block, especially when they failed so miserably. Now that there's proof that IP can (key word: CAN) work, these very same manufacturers aren't laughing anymore. They are scrambling to come up with IP products and systems. Most are doing well with them, but many are not. They may have done themselves in by waiting for the proverbial "third strike" that never happened.
Same thing with the local service providers and long distance services. They are losing customers due to the potential flexibility of IP. As with manufacturers, some of these companies may be a day late and a dollar short. Many of them are trying to make up their lost revenue with their cellular markets, but even that's starting to be a gamble. Look at Sprint and Alltel for example.
It's probably going to take a fourth or even fifth generation roll out before VOIP is really a total solution for the typical end user. At least now that the real phone system manufacturers are taking it seriously, research and development will move at a faster pace. This will also help to drive down equipment costs. Then, and only then will VOIP to every desktop be a viable option, if not the norm.
If taxation of Internet traffic ever occurs, then that may (will) cause a major shock wave in VOIP. Not so much from a cost standpoint, but from the psychological impact standpoint. "Oooh...VIOP costs too much since you have to pay taxes to use it". It could happen, but probably not nearly as significantly as the insane amount of tax paid on a traditional copper phone line. Land line taxes have been somewhat gradual in hitting us over time, so we hardly noticed them for decades. With Internet taxation, it will be an instant shock in a big way.
In my area, we are paying about 30% in local, state and federal taxes for a land line. That's just for dial tone; forget about the calls we make. Since when is having a phone, or even a cell phone for that matter, considered a source of "sin tax" revenue? Apparently now.
In closing, I think that in time the VOIP concept will eventually catch on as prices drop. I don't think that it's going to happen quickly. Maybe over the next two decades or so.
Please deposit twenty five cents for the next three minutes...(pay phone humor for the younger ones).
