Several layers of costs exist whenever you make a phone call due to regula- tions and the categories of carrier service. All five categories combine to form the bulk of the monthly recurring charges for customers (both residen- tial and corporate) under the existing PSTN model of telephony.
Carrier service companies do just about anything to keep their corporate customers using their services. They try to make a strong business case for your company to stick with them. If you’re unaware of the different rate cate- gories, your company’s total number of access lines, and how each category and line relates to your company’s particular telephony needs, it can cost you big bucks each and every month.
Your carrier may try to reduce your per-minute rates across the board. In the case of intrastate calling, they may offer flat rates that are not metered and charged by the minute. However, the carrier wants some kind of commitment from your company in return. The commitment can usually take one of two forms.
The first form is a volume-of-minutes plan. In this form of the plan, your com- pany, including all the locations connected through the carrier’s network, agree to use a specific, aggregate number of minutes on their carrier network. In this form, they always specify a term within which the minutes must be used, such as ten million minutes per month or per year. Read the small print regarding what penalties may apply if the company fails to meet the volume- minute quota in a given month or year.
The other form may relate to the total number of calls made irrespective of the total aggregate volume of minutes across your company’s enterprise. You can see this form when the company already has a flat-rate charging plan in place. For example, instead of paying metered charges for local, intralata or intrastate calls, a company might have a flat rate such as $.05 or $.06 per call. The recurring minutes or total usage minutes become secondary as a cost factor — with flat rates, the number of instances of placing calls are used to figure your carrier service usage bill.
It’s also possible to have a plan that combines both minute-volume and flat- rate plans into a sort of hybrid plan. The larger your company and the more locations in different states, the more you’ll need a thorough analysis to achieve the optimal plan if your company’s telephony needs are to be satis- fied by a POTS-PSTN carrier.
The biggest pitch that carriers use to get your signature on a multiyear ser- vice contract is to promise you deep discounts based on your company’s overall calling volume in minutes. For example, if your company does several millions of intralata minutes per month across all your company’s locations and you’re paying an average of $.07 per minute, the carrier’s account repre- sentative might offer you a new deal that reduces your intralata costs to $.05 or $.06 per minute.
After you’re using millions of minutes, a $.01 change in the rate translates into a lot of money. For instance, one million minutes at $.01 per minute equals $10,000 of cost to your company in one month. That kind of savings would sound swell — if you didn’t know that under a VoIP network plan you would have little or no charges for intralata carrier services. In a VoIP net- work, all on-net traffic would cost $0, and any calls that must go into the POTS-PSTN network would be reduced to local calls.
Your carrier account rep won’t want to tell you about the penalty if your com- pany fails to meet the volume commitment in any given month. The penalty could be an even higher per-minute rate than you had before the new deal or an increase in the term of your contract by one month for every month that you fail to meet the minimum.
If your company must stay on the POTS-PSTN carrier network, I suggest that you consider evaluating VoIP, if only for a few telephones or one small local area network at one of your site locations. If you already have the LAN run- ning, your cost will be minimal. Let your POTS-PSTN carrier account rep know that that you’re looking at VoIP, and see how fast it gets him or her to come around with a new deal that seriously reduces your monthly carrier charges. But don’t sign a long-term deal; as soon as you complete your VoIP testing, you’ll want to put much of your company’s telephony on VoIP.
Carrier service companies do just about anything to keep their corporate customers using their services. They try to make a strong business case for your company to stick with them. If you’re unaware of the different rate cate- gories, your company’s total number of access lines, and how each category and line relates to your company’s particular telephony needs, it can cost you big bucks each and every month.
Your carrier may try to reduce your per-minute rates across the board. In the case of intrastate calling, they may offer flat rates that are not metered and charged by the minute. However, the carrier wants some kind of commitment from your company in return. The commitment can usually take one of two forms.
The first form is a volume-of-minutes plan. In this form of the plan, your com- pany, including all the locations connected through the carrier’s network, agree to use a specific, aggregate number of minutes on their carrier network. In this form, they always specify a term within which the minutes must be used, such as ten million minutes per month or per year. Read the small print regarding what penalties may apply if the company fails to meet the volume- minute quota in a given month or year.
The other form may relate to the total number of calls made irrespective of the total aggregate volume of minutes across your company’s enterprise. You can see this form when the company already has a flat-rate charging plan in place. For example, instead of paying metered charges for local, intralata or intrastate calls, a company might have a flat rate such as $.05 or $.06 per call. The recurring minutes or total usage minutes become secondary as a cost factor — with flat rates, the number of instances of placing calls are used to figure your carrier service usage bill.
It’s also possible to have a plan that combines both minute-volume and flat- rate plans into a sort of hybrid plan. The larger your company and the more locations in different states, the more you’ll need a thorough analysis to achieve the optimal plan if your company’s telephony needs are to be satis- fied by a POTS-PSTN carrier.
The biggest pitch that carriers use to get your signature on a multiyear ser- vice contract is to promise you deep discounts based on your company’s overall calling volume in minutes. For example, if your company does several millions of intralata minutes per month across all your company’s locations and you’re paying an average of $.07 per minute, the carrier’s account repre- sentative might offer you a new deal that reduces your intralata costs to $.05 or $.06 per minute.
After you’re using millions of minutes, a $.01 change in the rate translates into a lot of money. For instance, one million minutes at $.01 per minute equals $10,000 of cost to your company in one month. That kind of savings would sound swell — if you didn’t know that under a VoIP network plan you would have little or no charges for intralata carrier services. In a VoIP net- work, all on-net traffic would cost $0, and any calls that must go into the POTS-PSTN network would be reduced to local calls.
Your carrier account rep won’t want to tell you about the penalty if your com- pany fails to meet the volume commitment in any given month. The penalty could be an even higher per-minute rate than you had before the new deal or an increase in the term of your contract by one month for every month that you fail to meet the minimum.
If your company must stay on the POTS-PSTN carrier network, I suggest that you consider evaluating VoIP, if only for a few telephones or one small local area network at one of your site locations. If you already have the LAN run- ning, your cost will be minimal. Let your POTS-PSTN carrier account rep know that that you’re looking at VoIP, and see how fast it gets him or her to come around with a new deal that seriously reduces your monthly carrier charges. But don’t sign a long-term deal; as soon as you complete your VoIP testing, you’ll want to put much of your company’s telephony on VoIP.
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