The Evolution from an Analog Business Phone System to a Hosted VoIP System

Telephones have come a long way in the few short decades since rotary dial phones — often in olive green or yellow — were mounted on everyone's walls, and every office used an analog business phone system.

An employee enjoys wireless devices that could not be used with an analog business phone system.
Cloud-based VoIP phone solutions liberate your office from the tyranny of an outdated analog business phone system.

The physical differences are obvious, and no one could confuse the phones of our grandparents' generation to the smartphones in our pockets. But technology isn't standing still. We are quickly moving toward the next iteration: the Internet of Things (IoT) revolution.

Communication technology is just one of the many types of technology revolutions that have occurred in recent history. It wasn't that long ago, in the grand scheme of things, that electricity replaced steam-driven machinery for mass production. Now, we can automate processes with new information technologies, such as using IoT sensors and robots to increase productivity and safety.

However, history will likely show that the transition from analog to cloud-hosted Voice over Internet Protocol (VoIP) was a pivotal shift that significantly impacted technology and communication. It's been more than just a shift in phone signals; it's changed how we share, transfer, and communicate data with each other. We are no longer tied down by phone cords or telephones, but have the freedom to communicate when, where, and how we want to. Our communications are now driven by our purpose — instead of our physical location.

VoIP is much less expensive than analog or digital because data is sent over the existing internet infrastructure, which reduces the cost of installing separate phone lines.

Transformation from an Analog Business Phone System to VoIP

When you make a call, you simply hear the voice on the other end of the line — regardless of how the call is transmitted. When a call was made with an analog phone, the voices were converted to electronic pulses, transmitted, and then turned back into human voices. Analog was eventually replaced by digital calling, which meant the voices were converted to binary, but the data was still sent over fixed telephone lines.

Over the past decade, communications have transitioned from fixed telephone lines to VoIP calling. Instead of telephone lines, the phone call is sent over the internet. Many businesses have shifted their business communications to VoIP, which means voice and data are all stored and transmitted on the same network.

Businesses still relying on analog phone service are often spending more money for fewer features. VoIP can be less expensive than analog or digital because data is sent over the existing internet infrastructure, which reduces the cost of installing separate phone lines. Also, VoIP phone features are efficiently hosted in the cloud, instead of residing on-premise at the business location. This can mean significant savings, especially in terms of setup fees, maintenance and monthly service charges.

This shift has had a dramatic effect on business because it changes the way communications happen and provides more flexible options for businesses. Employees can also use their hosted VoIP phone service remotely, whereever they're working on their smartphone, tablet or computer. Businesses can also scale easily with a hosted VoIP system — adding or reducing extensions, adding new features, and even expanding service to a new location — which can be accomplished virtually and quickly, without the need for a technician visit. With hosted VoIP, businesses are no longer limited to just voice calls; they can also send data, attachments, and video. Because businesses can now send faxes over VoIP without purchasing and maintaining a separate machine, this evolution has made standalone fax machines mostly irrelevant.

The Role of IoT Technology

During this same period, the internet of things (IoT) was born, which took communication to a new level. Using sensors, IoT devices can transmit data from a machine to a person. IoT devices range from simple tools, such as Nest Thermostats, to complex robotics used in manufacturing plants. Although smartphones were popular before the term IoT was used, many experts now consider smartphones to be IoT devices because they transmit data from machines to people, such as the apps that allow you to control your television from your office or turn on your front porch lights from your car.

While great strides have been made in the IoT revolution, there is still much further to go. Because IoT devices use hosted VoIP to send the data, the two types of communication are closely intertwined and their evolution is expected to follow similar paths. Experts predict that IoT uses will continue to grow, and more of our tasks — both personal and business — will be conducted using IoT devices.

Few will argue that an analog business phone system is a relic from the past, and it's easy to predict the attributes our future communications will embody — flexible, mobile, and scalable. If your business is still relying on traditional, wired communications, it's time to move into the future. Since your competitors and customers are already communicating through cloud-based communications, you may be even further behind when the next revolution arrives. It's time to get ready.

To learn more about cloud-based VoIP phone solutions, connect with a Vonage Business representative.

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