VoIP (Voice over Internet Protocol) Solutions Becoming More Popular for Small Business Phone Systems.

virtual phone system

A new report by VoIP software analysis company, Software Advice  surveyed over 350 businesses and found that although small businesses still rely on both landlines and mobile phones, small businesses are shifting towards virtual phone systems. This report surveyed over 350 businesses with annual revenues of $190 million or less during 2013-2014 – the goal of the report was to try to determine pain points and reasons for purchasing a new small business phone system.

  • More than half of potential buyers were investing in business VoIP service for the first time.
  • Scalability and reliability were the primary concerns when evaluating new phone systems.
  • A vast majority wanted a hosted solution, not an on-premise IP-P­BX.
Traditional PSTN and mobile connections going to the wayside

The research concluded that 31% of small businesses were still using a landline and 13% relied exclusively on their mobile phones as their main source of business communications. Over half of buyers (57%) asked said that they were looking to invest in a VoIP service for the first time.

Reliability and scalability important factor

17% of the sample noted lack of reliability as the largest issue with their current business phone system. Issues with connectivity and dropped calls were frequent problems for the surveyed buyers. Other buyers noted that their system’s maximum capacity was not large enough to accommodate company growth – about 15%.

Top reasons for new purchases

15% of those businesses surveyed said that a system with a lower price was important, 14% said that increased functionality was another major incentive to switch to VoIP.

Support was a major pain point for many buyers. One buyer noted that every time he needed to make changes to the system, he had to call someone else to do it.

Surprisingly for telecom professionals, improved call quality was not a major concern. Only a few buyers reported audio quality issues such as “static.” This finding is congruent with the results of a recent survey conducted on public concerns about VoIP, which found that only 10% of consumers were worried about call quality with VoIP services.

Cloud-based systems popular with small businesses

The reliability and support concerns that were uncovered create a high level of interest in hosted (web-based) solutions. None of the small business owners that were surveyed wanted to purchase an on-premise IP-PBX. 77% of the sample wanted a web-based solution, while 23% did not have a preference. This suggests that many small businesses do not have the IT staff necessary to maintain an on-premise system. Buyers like this tend to prefer a hosted solution that maintains itself and also grants administrative and user access through an internet browser.

Most desired applications – Auto Attendant at the top

Most buyers surveyed wanted private branch exchange (PBX) functionality from their phone systems—and those who did not specify this preference probably wanted a PBX without knowing the word for it, since PBX functionality is the backbone of a small business phone system.

After the need for extensions and directories, an auto attendant was easily the most in-demand application among the buyers surveyed. The popularity of the auto attendant stems from its ability to make any small business sound like a larger enterprise – for example, a local pet store. One business owner noted that he wants an auto attendant to give the appearance that his company is larger than it really is.

Voicemail-to-email and number portability also important

The death of voicemail has been proclaimed for nearly a decade now but more buyers (28%) requested this feature than any other. Also, 9% of buyers expressed a high level of interest in caller ID and 7% in voicemail-to-email functionality. Another very popular feature is number portability (7%). A number of buyers insisted that keeping their original number was a requirement. Not having number portability was a deal breaker for many small-business owners.


Even though many still rely on landlines or mobile phones, the data shows that small businesses are shifting toward VoIP solutions. These buyers are interested in solutions that are scalable and reliable. They want to add users easily and inexpensively as their business grows. Few buyers surveyed have an IT background, so effective technical support and reliability is very important. Small-business owners are interested in unified communications solutions that offer features such as voicemail-to-email. Since 13% of surveyed buyers are reliant on their mobile phones for business communications, small-business owners are interested in remote access and control of their phone systems. As VoIP technology continues to advance, it will become easier for small businesses to integrate voice calling, video conferencing, email, voicemail and chat using technologies that were formerly restricted. If you are interested in VoIP as your small business phone system then contact InfoStructure today to find out how your business phone system can be upgraded to a hosted PBX at an affordable price.