Cloud VoIP: All the Stats, Facts, and Data You'll Ever Need to Know

Have you heard about cloud VoIP on the grapevine?

Odds are that you have. And not just once.

After all, it’s a $30 billion industry that’s set to grow an impressive 15% per year until 2025. If we had to describe it with a single phrase, we’d say, “it’s a big deal for organizations of all sizes.”

But what is it? And why is it so important? And is it right for me?

Great questions. Does this graphic help?

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Absolutely not, right?

We thought so. Descriptions of VoIP cloud services are often overly techy and confusing, especially if you don’t have any experience with these systems.

Luckily for you, you don’t need to understand any of this stuff.

So in the name of simplicity and better comms, we’ve compiled this guide on cloud VoIP, where you’ll learn everything an end-user needs to know (and nothing more).

Before we start, here’s a cheeky sneak preview of today’s post:

1. What is cloud VoIP?
2. Five fun facts about cloud based VoIP
3. The benefits of a VoIP cloud service
4. Five handy purchasing tips
5. The top five service providers
6. Cloud VoIP FAQs

Let’s get going.

What is Cloud VoIP?

To really answer this question, we need to break the expression “cloud VoIP” into two parts.

First, what is the cloud?

Answer: The cloud has nothing to do with the fluffy things in the sky. It’s simply a word that refers to software and services that are hosted via a third-party’s servers instead of locally. You access these programs via the internet, usually in the form of a web browser.

Second, what is VoIP?

Answer: VoIP (Voice over Internet Protocol) is a technology that allows you to place voice calls over the internet instead of relying on traditional phone lines.

Now, if we bring it together, we can say:

Cloud VoIP (a.k.a. hosted VoIP) is a software solution that enables people to make calls over the internet without owning, hosting, and maintaining any hardware and software.

You can make calls through a VoIP softphone (a software app that lets you dial from any device connected to the internet), a VoIP hardphone (literally a VoIP-enabled phone on your desk), or a combination of the two.

They also come with a wealth of other features that go beyond simply making voice calls, including:

• Voicemail
• Call forwarding
• SMS (including automation)
• Caller ID
• Video calling
• Conference calling
• Call analytics

Are you satisfied with our answer?

Yes — move on to the next section; it’s going to be a blast.

No — spend five more minutes learning about VoIP here, but promise to rush back.

Five Fun Facts About Cloud Based VoIP

1. VoIP Technology Is a Lot Older Than You Might Think

How old do you think VoIP is?

10? 20? 30?

Guess again, it’s actually 48 years old (as of 2021).

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Yup, the first one-sided VoIP call was made way back in 1973, and we only had to wait an extra year for the first two-way call to take place in 1974.

Then what took it so long to break into the mainstream?

VoIP had to wait for the internet to catch up.

Those early calls relied on a super-advanced (for the times) US military research network called ARPANET, and that type of technology wasn’t available to the public for decades.

VoIP took off when high-speed internet connections became commonplace in the 2000s.

Extra fun fact: the first cloud based VoIP service for businesses was founded in 1995.

2. VoIP Calls Were Once Funded by Intrusive Adverts

Believe it or not, early commercial VoIP calls played ads before, after, and during calls.

For realz, player?

You bet your bottom dollar.

In the 1990s, when commercial VoIP was just getting started, the technology was so expensive that providers needed to use adverts as an alternative source of cash flow.

It was a bit like a 90s version of YouTube. Listen to some ads, make some calls.

But fortunately for us, VoIP calls started falling, and this intrusive business model fell into the only place it deserved, oblivion.

3. There Are Two Types of Cloud Based VoIP Numbers

Did you know that there are two main types of VoIP numbers?

Well, it’s true.

We can separate VoIP phone numbers into:

• Fixed — linked to a physical address
• Non fixed — not linked to a physical address

Non-fixed numbers are more commonly used because they’re cheaper, easier to obtain, and more flexible. They used to be less secure, but tech advancements have leveled the playing field.

However, many companies still stick with fixed numbers because they’re the best solution for connecting an existing PBX system to VoIP via SIP trunking.

4. You Can’t Tell the Difference Between VoIP and Traditional Calls

In the past, people could quickly tell the difference between a traditional copper line and a VoIP-powered connection. VoIP calls were plagued by:

• Poor audio quality
• Choppy conversations with missing words
• Dropped calls
• Annoying adverts

But that was because of slow, unstable internet connections — luckily a thing of the past for 99% of businesses.

And that means, nowadays, it’s impossible to distinguish between a cloud based VoIP service and a traditional phone line.

What’s more, if you’re faced with a choppy line today, the culprit is far more likely to be a copper connection as VoIP has surpassed its master in terms of call quality and reliability.

5. You Don’t Actually Need a Phone To Make a VoIP Call

We’ve alluded to this one in our definition of the term “cloud VoIP.” Remember?

You probably do because it’s worth remembering.

You can make phone calls from your phone using a VoIP softphone that doesn’t even remotely utilize your phone’s built-in calling capabilities. Mindblowing.

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It works because the VoIP softphone is simply an internet-connected app that uses the web to place the call.

This has the added benefit of allowing you to download and use the app on many other devices, including:

• Physical VoIP phones
• Computers
• Smartphones
• Tablets
• Smart TVs
• Smartwatches

Sooner or later, we hope to be adding smart fridges to this list.

The Five Benefits of a VoIP Cloud Service

Alrighty then, enough with the VoIP facts.

We’ve had our fun, but now it’s time to get serious and focus on the business benefits of implementing cloud VoIP.

Let’s start by skimming through this ridiculously good infographic from the friendly folks at Fastmetrics:

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And now let’s combine this graphic’s key points with our extensive VoIP knowledge in this ultimate summary table of cloud based VoIP’s five most important benefits:

Are you convinced by cloud based VoIP yet?

We’ll go out on a ledge (not a very small one, of that we’re sure) and say yes.

And you know what that means — you’re ready to look for cloud VoIP solutions that’ll turn these benefits from words into reality.

Here’s how you should go about doing it:

Five Tips for Picking the Best Cloud VoIP Service

1. Think Carefully About Pricing, Features, and All-in-One Solutions

Don’t fall into this mistake:

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It could cost your business much more than you’d be saving on your VoIP provider.

And while price deserves to be one of our biggest concerns, it shouldn’t be the only thing swaying our decision. No matter how tight (or wide) our budgets are.

If you go for a premium product, you might overpay for features you don’t need, and if you go for a budget product, you might miss out on ones that would simplify your workday.

So rather than taking a price-first approach, we advise you to focus on what really matters — your business process and the VoIP features that would best support them.

This is what we’d do if we were in your shoes:

1. Review our processes and speak to the end-users
2. Make a requirements list for the cloud based VoIP solution
3. Research products that fit both our budget and our requirements list
4. Make a shortlist of top contenders
5. Check customer stories
6. Trial a few providers
7. Sign up for a service

Give it a go; we promise it’ll work.

Pro tip 1: Don’t forget about bundles or all-in-one VoIP software that helps lower your costs and reduce billing complexity by combining several programs into one.

2. A Mobile App Is Necessary Regardless of Your Business Type

It’s 2021, and people use smartphones all the time.

And no, that’s not just a figure of speech.

People literally use them for an incredible 5.4 hours every single day.

And guess what? Like it or not, they’ll use them for work and dialing their customers, so you need to get with the times and give your staff a VoIP application they can use on any device.

This will allow them to use VoIP whenever and wherever they desire, saving you on expensive mobile phone bills and making their lives easier.

Pro tip 2: take advantage of “find me/follow me” call forwarding to receive incoming phone calls across all your VoIP-enabled devices.

3. Check (and Upgrade) Your Bandwidth Before Switching to VoIP

VoIP needs high-quality bandwidth, so if you don’t have enough, your VoIP system’s performance will suffer.

There’s no amount of complaining to your service provider that’ll fix it.

It’s as simple as that.

But what can you do to ensure that’ll never be you?

Check for the following things before you sign up for cloud VoIP service:

1. Your connection is free from too much jitter and latency.
2. You have two internet circuits, one for VoIP-only traffic and one for everything else.
3. You have an internet provider that delivers enough upstream bandwidth — a minimum of 180Kbps for voice-only and 1.8Mbps for voice and video together.
4. Your firewall is not inadvertently slowing you down as it scans for threats.

When you’ve sorted all four points, you’ll be ready for a problem-free VoIP calling experience.

4. Pick a Provider That Offers More Than Just VoIP Calling

Remember all the nifty features we listed a few hundred words back in the VoIP benefits table?

You know, things like:

• SMS texting
• Automation
• Video conferencing
• Voicemail
• Caller ID
• Local numbers
• Toll-free numbers
• Integrations with other business software

Well, make sure they aren’t just theoretical benefits by picking a VoIP provider that empowers your team with all these and more in their package.

But be careful not to overpay for things you don’t need — but we’re not worried; we’ve been over this already.

5. Consider Whether or Not You Need Calling Groups

Whether or not I need what?

Calling groups (a.k.a. call groups or ring groups).

It’s a call center concept where you route inbound calls into a group of agents that share the same skill, department, or experience to improve customer experience.

For example, you could place all your CRM sales staff in the “CRM sales” group.

Your cloud based VoIP provider would then route any sales calls about CRMs into this predefined calling group to reduce waiting times and the need to transfer them manually.

It looks like this:

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Just look at how happy that customer is!

And that smile is the reason many business call centers utilize this strategy to:

• Reduce transfer and resolution times (two of the most significant areas of customer dissatisfaction according to Zendesk)
• Maximize agent productivity
• Manage call overflow more effectively

It’s pretty helpful stuff, but it’s not for everyone — double-check you need it before forking over any extra $$ for it!

The Top Five VoIP Cloud Service Providers

Drumroll, please.

🥁🥁🥁🥁🥁🥁🥁🥁🥁🥁🥁🥁🥁🥁🥁🥁🥁🥁🥁🥁🥁🥁🥁🥁🥁🥁🥁🥁🥁🥁🥁🥁

Thank you.

It’s time to put the five tips you’ve just learned to good use and have a look at the best of the best when it comes to cloud VoIP.

We suggest you pop these links open and take a 5-minute look around these five providers’ websites while all this handy information is still fresh in your mind.

Five Cloud VoIP FAQs

1. Is VoIP a Good Idea?

It’s a slam dunk.

Cloud VoIP is a reliable technology that saves you money, improves call quality, and gives your employees the freedom to take calls from anywhere in the world.

What’s not to like?

2. What Are the Disadvantages of VoIP?

You got us there with your fast thinking — great way to turn our rhetorical question around.

So let’s be fully impartial and share the three things we don’t like about VoIP:

1. No internet = no VoIP (but who doesn’t have a decent connection these days?)
2. Potential security breaches (a risk if you use a poor provider without high-level encryption)
3. Emergency services can’t always pinpoint 911 calls to a location

They don’t sound too bad, right?

That’s because they’re not, and the advantages of VoIP outweigh them a thousand to one.

P.S. Click here to scroll back up to our discussion of the benefits of a cloud based VoIP service if Google has somehow linked you straight to this question.

3. Is Cloud PBX a Type of VoIP?

Yes.

Cloud PBX, or hosted PBX or cloud VoIP, is a type of internet-based phone system, which relies on a third-party service provider to host the PBX (Private Branch Exchange) offsite.

It is the opposite of using an on-premises PBX and connecting to the internet via SIP trunking.

Jump to the next FAQ to find out how it works.

4. How Does Cloud-Based VoIP Work?

We need to get a tiny bit technical to answer this one, but we’ll do our best to keep it simple.

Cloud VoIP works by breaking your voice down into data packets, compressing them, and transmitting them via the internet to your VoIP service provider. Here, the packets pass through your provider’s cloud-based PBX and get routed to your recipient.

This illustration of a cloud-based VoIP system (remember that cloud = hosted for the intents and purposes of an end-user) should help cement the concept:

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5. Is Cloud VoIP a SaaS?

Yes, absolutely.

Service providers use the SaaS (Software as a Service) model to make it as easy as possible for you to go from signing up to making VoIP calls.

They also handle the software’s infrastructure and platform, so you don’t need to worry about maintenance and updates.

It’s a perfect model for VoIP-enabling small and medium-sized businesses. Still, large companies are also joining the cloud VoIP train to reduce costs and free up their IT teams from having to constantly maintain their on-premises PBXs.

Final Thoughts on Cloud VoIP

To sum everything up in one short sentence, we can say that:

Cloud VoIP is the 21st-century solution for flawless business communication.

We could end our post here.

But since we feel you’d benefit from one last run through the main points we raised about cloud VoIP, we’ve made this little table as an ultra-fast way to refresh your memory:

Now we’re good. We can end this article with an inspirational call-to-action:

Go out there and source your team a cloud VoIP system that’ll transform every single call you make into a crystal-clear conversation that costs pennies (or even less).

P.S. When you’re researching potential candidates, don’t forget to check out Ringy’s extra features because our solution is much more than just a cloud VoIP softphone. Our bundle approach might end up saving you quite a few bucks at year-end!