Top Communications on a Budget
How you present yourself to your customers is the single most
important factor in your business' success. In the old days, your
primary contact with customers would have been through your retail
storefront, or second-hand, through your reputation with other
customers. Today, telecommunication plays an increasingly important
role in reaching new prospects, and in converting those prospects
into paying customers.
Computing and telecommunication technology has advanced at an
amazing pace in the past decade. New technologies make it possible
to communicate in ways that were not practical even 10 years ago.
What's more, rapidly declining prices for technology products make
it possible for budget-conscious small businesses to use them.
Sophisticated communication systems are no longer the exclusive
domain of the world's richest corporations.
Communication is no longer as simple as it used to be. Where the
telephone was once the primary mode of electronic communication,
customers can now reach you in many different ways. Likewise, you
can also communicate internally using many different media, each of
which has its unique benefits and weaknesses. This article will give
you an overview of what's available, how and where to use it, and
who to contact for more information.
Voice: long live the telephone
In the early days of the internet boom, many people were claiming
that the worldwide web would kill the telephone, much like the
computer was supposed to eliminate the need for paper. In fact, the
reverse has been true. Just as the explosive growth of e-mail has
fueled the laser print/laser printer paper industrial complex, the
growth of online shopping has generated more, not fewer, customer
phone calls. The telephone was, and still is, the most important
While the web is a great medium for publishing information, a web
site is not a person who can answer a customer's questions. It can
make many transactions, such as configuring and pricing a product,
much more efficient. But there are often situations where the
customer wants to talk to a human being. This is especially true of
higher-priced items: the customer will likely want to do his or her
tire kicking online. Typically, when he does call—with specific
questions—he is close to making a final decision.
A phone system is probably one of the most important purchases a
customer-oriented business will make. Its job is to enable you to
communicate efficiently by phone, both within the office, and with
your customers. A bad phone system repels customers; a good system
makes it appear as though each customer has a direct line to the
Phone systems, especially those with features like voice mail and
ACD (call queuing), used to be terribly overpriced. Thanks to the
convergence of computing and telecom technology, prices have
declined dramatically, while features and performance have increased
by leaps and bounds. This is especially true in the small office
market, a niche that had been largely ignored by the major telecom
equipment vendors until recently.
These new systems for the small office/home office environment
can be divided into three basic categories:
(including PC-based phone systems), and LAN-based phone systems.
Intercom (KSU-less) systems
Some of the most exciting developments in the past year have been in
low-cost intercom systems for offices with 12 or fewer people. While
there are a few very large corporations, the vast majority of
businesses have 10 or fewer people. Yet, this market was largely
ignored by phone system vendors until the past few years. New KSU-less
systems enable even the smallest office to enjoy sophisticated
features like intercom calling/paging, voice mail, cordless
communication, and more. Unlike big business phone systems, these
systems are priced very affordably, typically $100 to $200 per user.
The systems are designed to work with existing phone wiring, and are
The most exciting systems in this category are hybrid
corded/cordless systems that allow users to mix and match corded and
cordless telephones within the intercom systems. So, you can give
your office employees corded phones, while giving your shipping
clerks headset-ready cordless handsets to use back in the warehouse.
An outstanding example of this design is the
Panasonic 4-line cordless system. It's available at
HelloDirect.com; Hello Direct offers other KSU-less systems on
their web site as well.
Mini-PBXs are another exciting category, and a good fit for
companies that have more than 10 and less than 100 employees. These
systems provide a wide range of features, including voice mail,
automated attendant (robot receptionist), intercom features,
computer telephone integration, and (in some cases) automated call
distribution (call queuing for sales/customer support workgroups).
Mini-PBXs fall into 1 of 2 categories: self-contained appliances
and PC-based phone systems. Several companies make self-contained
systems that are easy to install and require minimal computer and
networking experience. These systems provide a basic set of features
that are sufficient for most small businesses, including: voice
mail, auto-attendant, intercom, and so forth. Two of the leading
vendors in this category are Bizfon and ESI. Bizfon, available at
Hello Direct and HelloDirect.com, makes a turnkey small office phone
system that handles up to 32 users. ESI makes a system called IVX
that expands to handle 100+ users. Bizfon's system is designed to be
self-installed. ESI's system is installed by an authorized dealer.
PC-based phone systems are an option for more technically astute
users. They have been around since the early 1990s, and have been
refined with the introduction of advanced systems such as Artisoft's
TeleVantage and AltiGen's AltiServ systems. These systems offer a
wider range of features and can be customized to meet the user's
exact requirements. For example, AltiGen's system makes it easy to
create elaborate IVR (auto-attendant) scripts that route callers to
different groups of people based on how they respond to telephone
prompts. These systems enable even small companies to handle sales
and customer service calls using a call center approach, where calls
are queued up and handed off to live reps in first come, first
LAN (IP)-based phone systems
If your company has installed a high-speed local area network (LAN)
for connecting your computers, you can use this same network as the
backbone for your office phone system. Most phone system vendors are
migrating toward this approach, and there are now several exciting
LAN-based phone systems on the market.
ESI, mentioned above, recently announced the release of a
LAN-based version of their award-winning IVX phone system. This
system uses a company's Ethernet data network to transport phone
calls. Thus, the phone and data cabling are merged. There is no
separate infrastructure to maintain.
When they were first introduced, LAN-based phone systems were
very experimental, had unpredictable audio quality, and did not
offer features that users of conventional phone systems took for
granted (such as one-button intercom calling). This has all changed
as phone system vendors have retooled the business phone systems to
use data networks as their backbone.
A number of companies, most of them relatively young, have led
this wave of development. Among the vendors to watch in this
category are: ESI (www.esi-tech.com),
Shoreline Communications (www.shoretel.com)
and Cisco (www.cisco.com). ESI
is especially interesting as they have retooled their award-winning
IVX phone system to use data networks to carry calls. They already
had a feature-rich system, and have simply migrated it to use
computer networks to carry calls.
Video: seeing is believing
Just as prices for computers and telephone service have plummeted,
so too have prices for videoconferencing systems. Once accessible
only to the richest companies, videoconferencing is now a commodity
For a time, people were predicting that video would be as
ubiquitous as the desktop telephone. That day has not arrived yet,
but video is cheap enough that it is becoming standard equipment in
meeting rooms around the world. The conference room is where
videoconferencing technology really shines. It makes it possible to
link people at remote sites, and to include people off site, such as
contractors. It's not the same as being there, but it is much better
than listening to a disembodied voice on one of Polycom's
Two of the leading vendors in this space are C-Phone (www.c-phone.com)
and Polycom (www.polycom.com).
Both companies offer turnkey videoconference terminals that work on
both ISDN and IP-based networks. You typically use the ISDN phone
line to call videophones outside your company, and use the IP
connection to call videophones or desktop PCs inside your company's
The quality of these systems has improved dramatically in the
past 5 years. It is now possible to send near-broadcast quality
video across a typical computer network. The days of watching
blurry, jerky video are long gone. As the quality has increased, the
prices have decreased dramatically. What used to be $20,000 systems
are now pushing the $2,000 price level. Desktop solutions, such as
Polycom's ViaVideo™ system, are now available for about $500.
Videoconferencing is a useful technology for any company in which
people travel extensively—between offices, say, or to meet with key
vendors. While they do not replace meetings entirely, they reduce
the need for travel dramatically. Because of this, they pay for
themselves very quickly when you consider the direct and indirect
costs of business travel.
Data: broadband for the masses
Not too long ago, 56 K was a "fast" internet connection. In fact,
just 10 years ago, the backbone of the National Science Foundation
Network (NSFNet), the precursor to today's internet, operated at
speeds ranging from 56 kilobits to a blistering 1.5 megabits. It's
hard to imagine that the backbone of the entire network ran at a
slower speed than a typical residential cable modem connection, and
that this explosive growth occurred in such a short time.
Today, most users in North America can get fast, always-on
internet connectivity for $200 per month or less, sometimes much
less. The beauty of the internet is that it can be overlaid onto any
2-way communication medium. Your computer does not care whether your
bits are being sent across a cable modem, digital subscriber line
(DSL), or some sort of wireless connection. This media-neutral
approach means that internet service providers can use different
technologies to provide access to different types of users. In
today's market, you have the following basic options: cable modem
service, DSL, fixed wireless, and satellite.
Cable internet access is currently the cheapest form of high-speed
internet service. It is available to several million home users, and
some commercial locations. Within the next 5 years, most cable TV
companies will offer some form of high-speed internet service.
The only drawback to cable internet service is the fact that it's
geared toward residential use. If you plan to host your own web site
in-house, or to enable outside users to access services via your
network, cable internet is not the best way to do this. Performance
is good, but highly variable. The good news is that cable internet
use tends to peak on the evenings and weekends, and tends to be
light during normal business hours. As a result, you should get very
good performance during normal work hours. Speeds typically range
from 200 kilobits to well in excess of 1 megabit, comparable to DSL
Digital Subscriber Line (DSL)
DSL is the phone companies' answer to cable internet access. Using
special modems, DSL can provide high-speed internet access via a
dedicated phone line (up to 6 megabits in some cases). Speeds
typically range from 300 kilobits to 1.5 megabits. The maximum speed
is related to your distance from the phone company central office
(CO) that serves your location. The closer you are to the CO, the
faster the DSL can run. Most users can get speeds up to 768
kilobits, which is more than enough for most uses.
DSL is better than cable access because the phone line is
dedicated to you. You are not sharing a conduit with numerous other
users, so performance tends to be less variable. There may, however,
be data bottlenecks upstream from the CO that you are connected to.
However, most DSL providers that focus on business customers provide
ample network capacity to avoid so-called brownouts where too many
users are competing for bandwidth.
DSL is somewhat more expensive than cable access, depending on
the class of service requested. DSL service for residential
customers ranges in price from about $40 per month to $200 per
month, depending primarily on connection speed. DSL service for
business customers ranges in price from about $100 per month to $400
per month. You can often get away with ordering residential service,
although you will need to order business class service if you want
to do things like host your web site on your own server, allow
outsiders to connect to machines on your network, etc. The main
problem with DSL is that it is not available in many areas,
especially in rural areas.
Fixed wireless is another option for users who cannot obtain cable
or DSL service in their locale. This technology is derived from the
wireless cable TV services developed in the 1980s. Users mount a
disk-like antenna on the side of their building. This antenna is
aimed at a repeater tower that serves users within several miles of
the centrally located transmitter.
Speeds and costs are comparable to DSL. The advantage of this
service is that it is not dependent on existing phone or cable TV
wiring. So, while it may not be economical for your phone company to
rewire your neighborhood for high-speed data service, you may be
able to find a wireless internet provider in your city. Sprint (www.sprint.com)
is in the process of rolling out this type of service in cities
throughout North America.
Finally, if all else fails, companies have begun offering high-speed
internet service via satellite. One company, StarBand (www.starband.com)
has developed an especially compelling offering. Their service,
available anywhere in the continental United States, offers download
speeds of 150-500 kilobits, comparable to residential DSL service.
Because the service is satellite-based, it is available even in
remote areas where terrestrial internet access is limited to slow
dialup connections. The service costs less than $70 per month, and
the equipment can be bought in conjunction with DirecTV satellite