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ISDN vs VoIP: what’s the best business phone system?

BT Openreach endorses VoIP phone systems as replacements for the PSTN and ISDN services that will be switched off by 2025. According to the telecommunications provider, these legacy telephony solutions can no longer support the communication needs of companies today.

Thus, BT Openreach encourages companies to turn digital business phone systems that are cost-efficient, scalable and multi-functional. Unsurprisingly, not everyone is immediately accepting of such a significant change. Some business owners are anxious that switching from PSTN or ISDN to VoIP might cost them a lot of money and trouble. 

If you’re still unsure how migrating to VoIP benefits your business, here’s an in-depth comparison of the two business phone systems to help you understand their differences.

ISDN Phone Systems

ISDN or Integrated Service Digital Network is a telephone-based network system that operates by a circuit switch or dedicated line. Unlike PSTN that transmits data analogue, ISDN does so over a digital line. Some internet networks run on ISDN when options like DSL aren’t available in the area.

Advantages of ISDN


1. Multi-Functional

ISDN offers multiple digital services operating through the same copper wire, from audio and video calls to internet connectivity. This means you can connect different devices to the line, including fax machines, credit card readers and even electronic point of sale (EPOS) machines.

2. Higher Data Transfer Rate

Each ISDN line can provide a bandwidth of 128 Kbps both for upload and download, enabling you to make or take video calls. ISDN also experiences very little data loss, if any, during transmission since it’s a routine switched network. This makes ISDN connections much stable compared to PSTN.

3. Better Quality

Because they run on digital lines, ISDN connections provide better speeds and higher call quality than traditional PSTN networks.

Disadvantages of ISDN


1. Costly

Calls are more expensive on ISDN compared to digital telephony. Landline calls tend to cost higher because there is a limited number of phone lines and users. You have to pay line rental for each line your firm uses. BT’s small business line rental fees range from £22 to £29 a month, depending on how many lines you need.

2. Inflexibility

ISDN networks are tied to geographical area codes. If you have to relocate your office, it might take weeks to have your landline and numbers changed or transferred.

3. Relies on Hardware

One of the most significant downsides of ISDN phone systems is their reliance on hardware. This makes ISDN challenging to set up and even more so to upgrade since you’ll have to purchase more equipment to give your network the additional capacity you want.

This reliance on hardware also makes your ISDN system prone to equipment breakdowns, which could result in network downtime.

4. Outdated

Lastly, ISDN phone systems are outdated. The technology has a confirmed end-of-life period, which means businesses have no choice but to switch to a VoIP network.

VoIP Phone Systems

VoIP or Voice-Over-Internet protocol routes your calls over the internet instead of traditional phone lines. Also called IP telephony, VoIP takes many forms, from hosted PBX, cloud VoIP and on-premise VoIP. These three options have mostly similar functions; the only difference is in the hardware and management of the system.

Advantages of VoIP


1. Cost-Efficient

VoIP offers many benefits, but one of its most attractive advantages is the lower costs. With a VoIP phone, you won’t have to pay monthly line rental fees. The price you’ll pay your provider includes all the services you need – from audio and video calls, international calls to mobile app integration and network management.

Switching to VoIP can give you cost savings between 30 to 50 per cent, depending on your company size and what system you were using before.

2. Scalable

Unlike ISDN networks that are tied down to hardware, VoIP technology resides in the cloud. You won’t have to purchase additional phone lines or cable modems since the cloud can give you all the space you need. You can quickly increase your capacity or scale your operations.

3. Accessibility

VoIP lets you make calls from anywhere using any device, as long as it’s connected to the network. This is incredibly helpful if you’re managing a mobile workforce. VoIP enables your teams to keep in touch with each other and access and send files no matter where they are.

4. Additional Features

Most VoIP providers offer telephony as part of a communications service package, meaning it’ll come with other functions. VoIP telephony’s most common features are CRM integration, advanced call routing, and cheap international calls.

Switching to VoIP also presents the opportunity to implement a unified communications solution, integrating all your communications tools and platforms into one interface for easy use.

Disadvantages of VoIP


1. Internet Connection Requirement

Your VoIP phone system is only as good as your internet connection. So make sure you have enough bandwidth to support all the digital services you need.

2. Cyber Attacks

VoIP networks are vulnerable to cyberattacks since they reside in the cloud. Look for a VoIP provider that also offers excellent security measures to keep your data protected from attacks.

3. Latency

The most common problem with VoIP networks is latency or delayed audio and video. This may be due to a poor internet connection or an inadequate router. Ask your VoIP provider if you need to upgrade either of these to improve your call quality.

Why should businesses use a VOIP service?

To summarise, businesses should migrate to VoIP services not only because of the ISDN switch-off but because of the advantages they’ll be able to enjoy. Seize the opportunity to analyse your company’s communications strategies and see how you can fill in the gaps in your efficiency.

Your goal here should be to future-proof your business. This means giving your people the tools and platforms they need to perform at their best.

If you want to learn more about VoIP phone systems, visit the Gamma blog. For enquiries about business communications solutions, please fill out our contact form.