Cloud Phone System

Cloud Telephony Costs: Everything You Need to Know

Cloud telephony enables businesses to:

  • Scale up or down their communication needs
  • Optimize their communication expenses
  • Improve productivity
  • Enhance customer experience while staying within their budget

However, businesses must also understand the costs associated with the same before opting for a pricing plan, such as the:

  • Subscription fees
  • Per-minute charges,
  • Hardware costs,
  • Hidden expenses, etc.

Let’s take a deeper look into these costs associated with cloud telephony in the sections below.

Introduction to Cloud Telephony 

A cloud phone system (or Cloud PBX) is an Internet-based VoIP (Voice over Internet Protocol) telephone system. It’s also referred to as a VoIP-based hosted PBX system.

In simple words, such a phone system is hosted in the cloud rather than in your office, which is why small and large businesses, call centers, and customer service departments can all benefit from it.

While phone systems have conventionally been housed in on-premises infra, cloud phone systems contribute towards reducing capital investment, allowing any size business to benefit from the features of an enterprise-grade phone system.

Key features of Cloud Telephony 

The following are some of the most valuable features of cloud telephony:

  • Auto-Attendant

This allows your caller to speak with the team assigned to them.

  • Inbound Call Forwarding

Inbound calls are forwarded based on predefined criteria with the help of this call-forwarding feature.

  • Advanced Interactive Voice Response (IVR)

A more conversational approach to automated customer service is Advanced Interactive Voice Response (IVR) which allows your customers to deal with your business without the presence of a live agent.

  • Video Conferencing and Screen Sharing

For productive remote meetings, you can use video conferencing and screen sharing.

  • Toll-Free Numbers

Toll-free numbers allow customers to contact you from landlines without having to incur additional toll charges.

  • Local Numbers

You can establish a local presence wherever you want by using local numbers unique to that location, which lets you set up operations in foreign countries as well.

  • Call Recording

Calls are securely and reliably recorded to ensure a seamless and excellent service.

Furthermore, sales and customer support agents who work remotely can easily remain connected within a standard network, which allows for seamless communication.

It makes it easier for team members to communicate while working remotely.

Factors Affecting Cloud Telephony Costs

Let’s take a look at the five most prominent factors that affect VoIP pricing:

  • The Number of Users

The subscription fees and per-minute charges or the VoIP phone price a business incurs will always be directly proportional to the number of users it has.

  • Features And Functionality Needed

When a business requires features such as the ones below, it will incur high costs:

  1. Virtual phone numbers
  2. IVR systems
  3. Call routing
  4. Call recording
  • Call Volume and Duration

Businesses cannot hope to maintain a low cost VoIP environment when calls last for long periods.

  • Geographic Location

The location of the business and its customers can also affect VoIP pricing. International calls, for example, can be more expensive than local calls, and so on.

  • Integration With Other Systems

If a business needs to integrate its cloud telephony with other systems, it will need to pay additional costs.

Cloud Telephony Costs Based on Usage Types

Cloud telephony costs can typically be broken down into several usage types, on the basis of which businesses can explore ways to optimize the associated costs:

  • Setup And Installation Fees

These are one-time costs associated with setting up and installing the cloud telephony system. They can differ from vendor to vendor and are based on the complexity of the system.

  • Monthly Subscription Fees

These are recurring fees that businesses pay to use the cloud telephony service. This fee varies based on the number of users and the features in the subscription.

  • Usage-Based Fees

It is charged based on system usage, such as per-minute charges for calls or fees for text messages sent or received. The cost can vary based on the usage volume.

  • Additional fees

It may apply to certain types of usage (international calls, premium features, etc.) that are not included in the standard subscription, along with the vendor and the location of the call.

Comparison Of Cloud Telephony Costs with Traditional Phone Systems

While comparing cloud telephony costs with traditional phone systems, consider the following factors:

  • Infrastructure Cost Savings

Traditional phone systems require significant infrastructure costs — hardware, software, and maintenance.

On the contrary, cloud telephony requires minimal upfront investment in infrastructure, as the service is hosted and maintained by the provider.

  • Usage Costs Savings

With traditional phone systems, businesses are charged for every call and may face additional charges for long-distance or international calls.

In contrast, cloud telephony providers typically offer unlimited calling plans based on usage, which can result in significant savings on VoIP pricing.

  • Upfront and Ongoing Cost Savings

Cloud telephony providers also charge a fixed monthly fee, which makes it easier for businesses to budget and plan for their communication expenses, unlike traditional phone systems that can have unpredictable costs.

  • Scalability and Flexibility Benefits

With cloud telephony, businesses can easily add or remove users, features, and services as needed with minimal cost or disruption. This makes it easy to scale communication needs without incurring significant additional costs.

Traditional phone systems can be expensive to scale, as you’ll need additional infrastructure for that.

Ways to Reduce Cloud Telephony Costs

Now, businesses can also reduce their VoIP pricing costs by following these tips:

Evaluating And Optimizing Usage Patterns

It’s important to analyze usage patterns and adjust service plans and features accordingly. For example, if your call volume is low, you would do well to downgrade to a less expensive plan or remove unnecessary features.

Selecting The Right Plan and Provider

You should also research different cloud telephony providers to find the most suitable and cost-effective option. You should compare their:

  • Pricing
  • Features
  • Customer reviews

Negotiating With Providers for Discounts or Better Rates

Some providers may offer discounts or better rates for longer-term contracts or bulk usage. It’s worth negotiating with providers to see if there are any cost-saving options available.

Regularly Reviewing and Adjusting Usage and Features

Regularly reviewing usage patterns and adjusting service plans and features accordingly can help you optimize costs. For example, if a feature is not being used, you may consider removing it to reduce costs.

Cloud Phone Service Pricing

Depending on the features and number of lines your company requires, cloud phone service pricing is impacted by the number of:

  • Phones you need
  • Calls you need to make, etc.

The pricing typically ranges from $20 to $150 per line.

Moreover, you can get a lower per-user price if you sign up for a longer period, such as between 36 to 60 months. This means that if you prefer to pay annually rather than monthly, you may be eligible for additional savings. 

Now, choosing a cloud-based phone provider can be difficult, which is why you must research thoroughly.

For example, JustCall is a leading cloud phone system, trusted by sales and customer service teams at 6,000 businesses worldwide.

It offers a long list of advanced (and affordable) features.

You can learn more about JustCall pricing here.

justcall-ai-product-pricing

You could also schedule a free demo today and find out how JustCall can empower your sales and support teams to perform at peak and achieve ten times the result.

To Conclude

The pandemic taught us to work virtually, which is why cloud system telephony is in more demand than ever, with business owners looking to adapt to the remote work model.

However, it is also important to keep the big picture in mind as you continue investigating the costs of cloud-based telephony.

Additionally, understanding the factors that affect cloud telephony costs and ways to reduce them is vital to optimizing your spending and getting the best ROI.

Thus, you should follow the tips outlined above and carefully evaluate the needs of your business, since it is possible to choose a cloud telephony solution that strikes the right balance between cost and functionality.

FAQs on Cloud Telephony

What Is Cloud Telephony?

The term “cloud telephony” refers to the use of the Internet to make phone calls in a business. It is software that runs on a third-party service provider’s servers.

Do Cloud-Based Phone Systems Work Fine?

The quality of your cloud telephony service will depend upon the kind of internet service you have in your organization.

If I Lose the Internet Connection, Will Cloud Telephony Still Work?

Cloud telephony comes with the feature of call forwarding. So, you may still receive the calls on your handset if there’s no internet connection.

What Is the Usual Cost of Cloud Telephony?

Cloud phone services pricing typically ranges from $20 to $150 per user per month, though these costs can vary depending upon the features you select.

Does This Work for Remote Teams and Workers?

Yes. Cloud telephony is a better option for remote workers and teams to remain in touch with each other.

With a foundational role at Saas Labs, Anand has been a key player in establishing the Product Management function and spearheading the launch of our Conversation Intelligence solution. His expertise in AI innovation guides both the strategic direction of the products and a team committed to excellence.

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