There are many reasons to support providing Hosted VoIP services. Here are five of the most compelling:

1. VoIP is Sticky

Telephony in general is sticky (once they have made a decision, customers tend to stick with it) by nature. VoIP adds an additional level of stickiness by offering customizable applications. If customers are leery of switching their voice provider, imagine how much more leery they are going to be when they have custom-built applications that match their business's needs.

2. VoIP Provides Additional Revenue Streams

 

Changes in the telecom market have mirrored those that happened in the transportation sector during the late 19th and early 20th centuries. Then, railroads had a monopoly on transport, owned the transport routes, and charged for simply providing movement of goods. However, with the advent of trucking and improved highways, that monopoly was lost; Railroad companies could no longer compete simply by being able to offer transport. Instead, they had to compete based on value-added services.

The same trend is happening in the telecom industry today. Originally, competition was limited and telecoms could bring in revenue simply by charging for the ability to place a call. With the advent of the Internet, however, the charge for a call is essentially heading towards zero. Given this erosion of profit margins, companies have to compete based on value-added services in order to remain viable.

3. If You Don't, You Will Be Out Of Business Within 5 Years

Simply put, IP telephony can deliver significantly more advanced features than traditional telephony, at an equivalent or lower cost. Consider telephony provider for businesses was able to offer long distance service for calls from Mexico to the US for 5 cents a minute, compared with the 30-50 cents that traditional providers were charging. Because the costs of IP telephony are lower than traditional POTS, service providers offering hosted VoIP services gain an immediate advantage over existing competition. Looked at another way, companies that continue to charge 30-50 cents for that long distance call are going to face unexpected competition.

4. Phone Service And Applications Are Migrating Towards Being IP-Based

 

This migration impacts those service providers already in the business and those outside of it. If you are already in the business, you absolutely need to switch to remain competitive. If, on the other hand, you are new to the marketplace, you have a unique opportunity to use this transition period to become a significant player down the road.

5. The Integration Of Voice And Applications Is Getting Easier

This trend heralds a boom in application development in the near future. Establishing a customer base now will enable service providers to leverage these upcoming applications as they hit the market.