Opinion: Is cloud the answer for telephony?

Telephony was among the first communication platforms to be used and has been around for nearly 150 years. For most of this time, it existed as traditional hard-wired, exchange based technology.

Over the last 10 to 15 years a revolutionary change occurred with the advent of IP Telephony (IPT) using Internet technology coinciding with the popularity of other services such as the World Wide Web, streaming, and online. This is when the term Unified Communications was first coined, bringing together separate means of communication such as telephony, video, and chat. Arguably it was the first radical move in a long-established industry and such was the popularity of this shift that today predominantly only IP Telephony products are available.

Most providers of IP Telephony products supply similar products with differentiators such as reliability and features. It has been common for businesses to buy, install, and maintain them themselves as was the case with their predecessors, traditional Telephones.

Over the last three to five years with the popularity of the Cloud for IT systems, there has been another market shift- Cloud based telephony is now building momentum. This is a disruptive model for vendors involving a move from capital expenditure where systems are acquired to a subscription model where the service is paid for on a recurring basis.

Telephony can be a significant investment for companies but has a finite shelf life. Therefore the benefits for businesses using a cloud subscription model can be evident. It removes some of that long-term investment impact as a subscription should mean access to technology that keeps pace with innovation and developments.

There is a reduced need for skills to design, buy, build and maintain a system that is based in the cloud and therefore those services, in theory, can be more cost effective, due to economies of scale with the added benefit of increased security. In addition, cloud strategies are becoming the norm for many businesses and so there is almost an inevitability for most about contemplating the transition.

Cloud Telephony does have some downsides and companies should consider if ownership of their Telephony system is a better option than moving it to public cloud offerings from Microsoft, Google, and Amazon etc. If they are going to make such a move then businesses should consider which provider will give them what they need and how to switch. It should be kept in mind that the offerings of traditional Telephony vendors will be arguably more feature rich, having a longer provenance and history of reliability. If any of these are critical to your business then public Cloud services may not be the optimal fit.

For some sectors, telephony may be too important to trust to the cloud. Public cloud is only as good as the internet used to connect to it. If your organisation is transacting business over the phone then you may not consider public cloud to be mature or reliable enough to trust with your livelihood. In general, people don’t really think about telephones too much as we are all very familiar with them having existed on our desks for years. It is not until they don’t work that they suddenly become important. Whilst the internet is more stable than once it was, it is still not as reliable as on-premise systems and vendors will argue that their offerings can be more robust.

There are alternatives, such as hybrids which use a mixture of private cloud, public cloud, and on-premise equipment. Private cloud is more self-contained and reliable but it comes at a price premium compared to public services. On-site equipment does have its advantages – being able to monitor and fix the equipment yourself may provide control and peace of mind but it must be purchased, maintained and upgraded. This has capital, time and staffing costs. 

Other factors are also having a disruptive effect on the general shift away from telephony at home and work. People are not making as many telephone calls as they used to. Many of us use email, messaging and on-line services to communicate and transact business. Younger people coming into the workplace prefer other means of communication and often see speaking to someone as a last resort. These factors over the next 3 to 5 years will inevitably reduce the reliance on Telephony for most.

Cloud providers can prove to be very ‘sticky’ and so this is an additional consideration when choosing a provider. Ensure that it's clear how your service can not only be moved to the provider but also moved from and what penalties (if any) may be charged.

Telephony is a simple application but quality matters. The audibility and reliability aspects of public cloud services are improving but are still in their infancy. Companies should consider this before switching. The costs should be examined closely as a monthly or annual subscription charge can often look cost effective but charges can mount up when added services are included. Reviewing the overall cost and the possible benefits to a business can be complex and may require external expertise.

Cloud telephony and unified communications strategies will improve over time and in many ways the shift to using these services in the workplace is almost inevitable. But whilst there are choices and different solutions are available it is important that companies weigh up what it important to them and make an informed decision.

Do you believe the cloud is the answer for telephony? Share your thoughts in the comments.

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24 May 2017, 8:28 a.m.

Good article, it is worth noting that the cloud telephony market is fairly sophisticated (in the UK at least) and offers a wide range of options that span what IT would call CPE/private cloud/public cloud fairly seamlessly. The major IT cloud vendors you mention don't really figure as they lack the features that enterprise find essential, but telephony vendors offer services that are both feature rich are customised to the reliability/latency/security which is essential to voice. The include things like "public cloud" services with direct interconnect or VPLS to connectivity providers that provide the scale benefits of public cloud with the reliability of private cloud.