Tallying the costs of traditional phone service is like adding up the cost of sending your kid through college. There just doesn’t seem to be an end in sight to the charges. As if the access line costs and recurring carrier service charges weren’t enough, you must deal with other monthly costs and regula- tory fees. These payments, which go to various government entities rather than to your LEC, are based on a percentage of each line’s monthly access cost. Examples include the Federal line surcharge and the 911 fee.
It may seem like these monthly charges are nominal but, just like the national debt, they really add up. Just dig out your last phone bill and take a look at the total cost. Depending on the location of your telephone lines (that is, which LATA applies), these regulated fees typically total about 4 to 7 percent of your total monthly access costs. A medium-size company with twenty loca- tions, call centers at each location, and lots of calls across the United States racks up a monthly carrier services bill of approximately $500,000. This com- pany would be looking at add-on monthly recurring costs of approximately
$20,000 to $35,000. That annualizes out to $240,000 to $420,000. Final costs depend on the LATAs involved and the specific types of access lines. But
these are add-on costs that do not need to be counted in a VoIP network; they largely go away.
If you convert to VoIP, you’re still charged regulatory fees for your dedicated network lines, but you already pay these costs to support your computer data network. You do not have to pay them again because VoIP calls are car- ried on your computer network. There are no additional regulatory costs for running VoIP telephony over your computer network. And with your tele- phony carrier services needs now being supported by your computer net- work lines, you can drastically reduce or eliminate the number and types of
lines your company needs to support the POTS-PSTN way of doing telephony.
Finally, we come to the calling features, such as voice mail, call waiting, and call forwarding. The LEC charges for features à la carte, and if you’ve ever ordered à la carte in a restaurant, you know it costs more. This is because you pay for each individual feature (item) separately. For example, call for- warding might be a $5 per month per line charge on top of all the other charges you pay.
Your LEC may be able to bundle features and leverage your company’s total monthly usage minutes for all your lines to offer you calling features at a lower cost. Be careful if the carrier asks you to commit to a more lengthy term to achieve cost reductions; in the end, they may cost you more!
Most companies with their own internal telephone system provide their own calling features. With pure POTS and Centrex line models, calling-feature costs can have a big effect on your company’s monthly telephone bill. Remember that features are priced based on each line. If your company has hundreds of lines, the overall cost for all features for all lines can be astronomical. For example, adding voice mail ($8), call forwarding ($5), and conference call ($4) features to two hundred lines would cost your company an additional $3400 each month. Wouldn’t you rather hire additional employees or install a large- screen TV in the break room with that money? As you may have surmised by now, VoIP comes with all the features of the POTS world, plus many new and exciting ones.
It may seem like these monthly charges are nominal but, just like the national debt, they really add up. Just dig out your last phone bill and take a look at the total cost. Depending on the location of your telephone lines (that is, which LATA applies), these regulated fees typically total about 4 to 7 percent of your total monthly access costs. A medium-size company with twenty loca- tions, call centers at each location, and lots of calls across the United States racks up a monthly carrier services bill of approximately $500,000. This com- pany would be looking at add-on monthly recurring costs of approximately
$20,000 to $35,000. That annualizes out to $240,000 to $420,000. Final costs depend on the LATAs involved and the specific types of access lines. But
these are add-on costs that do not need to be counted in a VoIP network; they largely go away.
If you convert to VoIP, you’re still charged regulatory fees for your dedicated network lines, but you already pay these costs to support your computer data network. You do not have to pay them again because VoIP calls are car- ried on your computer network. There are no additional regulatory costs for running VoIP telephony over your computer network. And with your tele- phony carrier services needs now being supported by your computer net- work lines, you can drastically reduce or eliminate the number and types of
lines your company needs to support the POTS-PSTN way of doing telephony.
Finally, we come to the calling features, such as voice mail, call waiting, and call forwarding. The LEC charges for features à la carte, and if you’ve ever ordered à la carte in a restaurant, you know it costs more. This is because you pay for each individual feature (item) separately. For example, call for- warding might be a $5 per month per line charge on top of all the other charges you pay.
Your LEC may be able to bundle features and leverage your company’s total monthly usage minutes for all your lines to offer you calling features at a lower cost. Be careful if the carrier asks you to commit to a more lengthy term to achieve cost reductions; in the end, they may cost you more!
Most companies with their own internal telephone system provide their own calling features. With pure POTS and Centrex line models, calling-feature costs can have a big effect on your company’s monthly telephone bill. Remember that features are priced based on each line. If your company has hundreds of lines, the overall cost for all features for all lines can be astronomical. For example, adding voice mail ($8), call forwarding ($5), and conference call ($4) features to two hundred lines would cost your company an additional $3400 each month. Wouldn’t you rather hire additional employees or install a large- screen TV in the break room with that money? As you may have surmised by now, VoIP comes with all the features of the POTS world, plus many new and exciting ones.
The bottom line? With VoIP, you can reduce your monthly recurring charges by as much as 95 percent — and that’s a lot of money in anyone’s book!
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