Cloud Telephony: What It Is and How Does It Work?

 According to the Eurostat survey, 56% of large enterprises use cloud services, while only 25% of small and medium-sized enterprises use cloud services. 

Cloud telephony is one of the best communication systems allowing businesses to manage voice services over the Internet rather than traditional on-premises systems. 

This shift has been required by the increased business need to have cost-effective, scalable, flexible communication tools that enhance efficiency in operations and improve customer interactions.

In this article, we’ll explore the fundamentals of cloud telephony, including its advantages and disadvantages and how it works. Let’s get started!

What is Cloud Telephony?

Cloud telephony, also known as a VoIP-hosted PBX solution, is a system that uses the Internet to handle phone calls. It allows you to move your business telephone services to the cloud.

This system grows with you to make business communication easy with cloud telephony. It is also cost-effective for team building, hiring remote employees, and opening new branches.
Cloud telephony is a part of unified communication as a service (UCaaS). It integrates communication tools, allows online phone calls, and connects them to video meetings, messaging, and CRM systems.

How Does Cloud Telephony Work?

Cloud telephony works by making and receiving phone calls over the Internet rather than traditional phone lines. When you make a call, your VoIP provider handles call routing. Your voice is converted into digital data packets and sent to the person you are calling through the Internet.

Instead of using traditional phone lines, you will connect VoIP phones to your current network. You can also use a softphone, which is an application that runs on your computer, tablet, or smartphone. This allows you to make calls through a simple interface that connects you quickly.

Your phone system can be managed through an online dashboard because cloud telephony is hosted online. Using a single, user-friendly platform, you can add new users, manage your phone numbers, and set up call-forwarding functionality.

What are the Advantages of Cloud Telephony?

Cloud telephony refers to voice communication services provided over the Internet rather than traditional phone lines. This technology is very popular because it has many advantages over traditional phone systems. Here are the following advantages of cloud telephony:

1. Easy and Fast Setup

Cloud telephony is easy and quick to set up. It requires large amounts of equipment and complex installation times. And cloud solutions can be operational regarding days and hours. There is no need to wait for a

 technician or deal with telephone installation. Everything will be managed by your cloud telephony provider. You will get virtual phone numbers and a user-friendly dashboard for managing calls and settings.

2. Lower costs for Your Phone System

For your business, cloud telephony can be the best result in saving a lot of money. Many businesses report saving up to 65% on phone bills compared to traditional phone systems. Cloud phone systems eliminate costs related to hardware maintenance, limited calling minutes, and paying for separate services such as SMS. Everything is included in a single package.

You can use devices such as laptops instead of purchasing the new mobile phones to save money. This is the best choice for the startup and also small businesses analyzing the cost.

3. Flexibility and Easy Scaling

With cloud phone systems, your business can grow without worrying about your phone system. Unlike traditional PBX, where adding a new employee means installing new phone lines and paying extra costs, cloud telephony lets you add or remove users instantly with just a few clicks.

This has allowed businesses to handle times of growth and seasonal changes smoothly. A hosted PBX answers your needs by allowing you to rise up or down without delay and extra cost and by ensuring that customer service remains just as smooth during your business’s growth.

4. Mobility for Remote Work

People are changing the way they work, and it has become very common for employees to work from home. This trend is perfectly fitted to cloud telephony. In other words, your workers can do their job using their company’s phone lines from anywhere in the world if only they have access to the Internet. 

This means that individuals will be able to easily answer calls, listen to voicemail, and manage call routing from any location. It is essential for companies to effectively communicate with remote workers, satellite offices, and various other places. 

5. Streamlined Communication

With cloud telephony, all your communication tools are brought together in one place. This means you don’t have to search through different systems or notes to find important information. When everything is organized in a single platform, you can quickly access what you need. 

It will also help you collaborate with team members, manage customer relationships, analyze data, and keep projects moving without interruptions. You can literally find everything in one place, which makes life so much easier.

6. Reliable and Resilience

Being available to your customers is essential and one of the issues that can harm your reputation is a problem with the phone system. The majority of cloud telephony solutions guarantee 99.999% uptime, making sure that you will be able to stay connected even in the event of a power outage or other issues. 

Cloud systems also include backup features. If there is a disruption, such as low-quality or lost calls, you have options for continuing communication. Being reliable is less important than creating and maintaining a trusting relationship with your customers.

What are the Disadvantages of Cloud Telephony?

Cloud-based phone systems have many benefits, but it is also important to consider the disadvantages. Understanding these challenges will help you decide if this is the best choice for your company. Here are the following disadvantages of cloud telephony:

I. Dependence on Internet Connection

Cloud telephony faces significant challenges due to its reliance on a strong internet connection. If your internet fails or slows, your phone service may suffer. This can result in dropped calls, poor sound quality, or complete outages. 

This can be a major problem for businesses that depend on clear and reliable communication. If your team is in an area with poor internet access, it may result in frustration and missed opportunities. 

II. Limited Control Over Service

Cloud telephony is a service managed by another company. This means you have less control over the system than with traditional phone systems that you operate internally. If there are updates, changes, or problems with the service, you have to depend on the provider to fix them. This can cause delays in problem resolution, and you may not have control over how features are updated or changed.

II. Security Concerns

When you use cloud telephony, your sensitive information is stored online. While many providers implement strong security measures, there is always the risk of hacking or cyber-attacks. If there is a hacking attempt, sensitive customer or business information may be compromised. 

Businesses have to make sure that the cloud telephony provider they choose has strong security procedures set up to protect their data. This is especially important for businesses that handle sensitive information or operate in regulated industries.

IV. Ongoing Costs

Although cloud telephony can save you money over traditional systems, there are still ongoing costs to consider. Many providers offer monthly subscription plans, and these fees can accumulate over time. 

Depending on the features you select, your costs may rise significantly as your company grows or if you need to add more users. Understanding the pricing structure of the service you choose is essential to avoiding unexpected expenses in the future.

V. Potential Learning Curve

Employees who are used to traditional phone systems may need some training to transition to cloud telephony. There may be new features and interfaces to learn, resulting in a temporary drop in productivity as employees change to the new system. 

While most cloud telephony solutions are designed to be easy to use, some team members may find the transition difficult.  To make sure that everyone is comfortable with the new system, sufficient training and support must be provided during the transition period.

VI. Quality of Service May Differ

The quality of your cloud telephony service will differ according to your internet speed and the provider you select. If your internet connection is slow, you may notice poor call quality or problems in conversations. 

Furthermore, not all providers provide the same quality of service. Some may have more strong features or provide better support than others by influencing your overall experience. Researching different providers and reading reviews can help you find one that meets your requirements.

VII. Limited Emergency Services

Using traditional phone lines makes it easier to reach emergency services. Things can get more complicated with the cloud telephony. For example, “If you call emergency services from a cloud phone, your location may not always be properly reported.”

This can cause problems in receiving help in critical situations. Businesses have to make sure that their cloud telephony service is capable of handling emergency calls and that their employees understand how to use it in such situations.

VIII. Vendor Lock-in

It can be difficult to switch cloud telephony providers once you’ve decided on one. Many providers have unique features and systems that may not be easily transferred to another service. 

This can lead to vendor lock-in, where you feel trapped with a single provider even if their service no longer meets your requirements. Before performing a cloud telephony solution, we should consider how easy it will be to switch providers in the future.

Cloud telephony vs. traditional PBX: Key Difference

Here’s a key difference between cloud telephony vs. traditional PBX in a table format:

Final Words

Cloud telephony simplifies, including its cloud calling capabilities, costs less, and makes business communication more flexible. It keeps teams connected while working remotely or at the office.

It is simple to set up, grows in a team with your business, and integrates easily with other tools. However, it will require a very good internet connection to show all of its capabilities. This is how 

Cloud telephony can help your business achieve more effective communication, cost savings, and a prepared for the future mindset.

FAQs

What is the traditional telephone system an example of?

The traditional telephone system is an example of a Public Switched Telephone Network (PSTN) that uses circuit-switching technology to make calls.

What is an example of a telephony?

An example of telephony is using a landline or mobile phone to make voice calls or using VoIP services like Skype.

How does VoIP differ from traditional phone service?

VoIP sends voice over the internet through packet-switching, whereas traditional phone service uses circuit-switching over dedicated lines.

Can I move my VoIP phone anywhere?

Yes, you can move your VoIP phone anywhere with an internet connection, but you may need to modify the settings.

Can I use a traditional phone for VoIP?

Yes, you can use a traditional phone with a VoIP adapter to connect to the internet.