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Small Business Management Article

Internet Telephone and How to Determine Your Needs


Raymond D. Matkowsky

More and more companies are ditching their present telephone service for the Internet. It is much less expensive to place calls across the internet than through conventional landlines. If you have the right service details, voices are crystal clear. However, many times people do not know what they truly need. You could ask a supplier, but you can’t be certain that you will get the best possible advice. Each company is different, has different equipment, and different needs. One size does not fit all! You should give some thought to your needs prior to contacting a supplier.

Suppliers may want to sell you a package that includes what you want plus more and do so at a price cheaper than individual installations. Do not do so! I have witnessed too many of this type of situation go bad and eventually cost the customer much more money than originally planned for. In addition when you change several things at once and it doesn’t work out right, you do not know what is causing the problem. Sometimes problems will not manifest themselves until the coming weeks or months. Each system needs to be customized. Past supplier experience is no guarantee of a smooth installation.

Factors Affecting Your Internet Speed and Quality

There are many factors that could affect your Internet connection and subsequently your voice quality. Many of these factors are not under your control. You can only compensate for their possible effects.

Let us first look at the factors you may have some control over. With some you may have only limited control. Your internet speed is one such factor, but it may be heavily dependent on hardware such as your modem, router, wiring, bandwidth, the software you run, and the types of computers you use. All hardware should be optimized for the best performance or compensated for. For example, your router should be up to date with its firmware. Modems are occasionally updated by their manufactures. However, many of these updates are pushed through by the internet service provider (ISP). Much of the time neither you nor the modem manufacturer’s customer service representative can update the modem. You are therefore dependent on your ISP to keep you up to date.

What factors do you not have control over? There are many depending on your individual situation! The first is the distance between you and your ISP’s central office. It is not the overland distance. It is the distance of the wires. Wires can take several turns or be coiled. The length of wire used could be much greater than the overland distance. Other factors that could affect your speed and quality could be the ISP’s server, the ISP’s internet connection, connections made at all the nodes along the Internet, congestion, codecs in use (for compressing and decompressing data), data packet loss (normally occurring and intentional) and the number of users on the network. With respect to users, don’t forget if you have cable or fiber, it is not just you, but everyone using the network at the same time - internet, phone, television etc. In short, there are numerous factors that can affect the quality of your voice connection.

Data packet loss is one. Packet loss is always bad. In internet phone service it can cause jitter and gaps in received speech. Most internet protocols correct for up to 5% loss. You probably could tolerate about 6.2% loss. If you have a slow connection and a high packet loss beyond 6.2%, you will begin to see some impact on quality. Besides normal loss, ISPs intentionally drop packets to control the traffic along their network. It is the cheapest way to control this traffic. They assume your browser will correct for the loss. They do not assume that you may have a loss that is above what your browser can correct for.

A major concern is latency. Latency is measured in milliseconds (ms) and is the delay when a voice or data packet is transmitted and the moment it reaches its destination. With voice, this translates into delays and echo affecting the quality of your communication. A latency of 20 ms is normal. 150 ms is barely perceptible. With higher latencies quality starts to diminish. High latency may cause buffering problems which in turn causes voice interruptions.

Another major concern is bandwidth throttling. Bandwidth throttling is the intentional slowing of internet packets by ISPs. Data packet dropping is a common technique to control bandwidth usage among ISPs. As we have previously said, they do this to cut costs by regulating traffic on their network. During the time of “Net Neutrality” no ISP was allowed to slow any traffic. Some did so anyway. On June 11, 2018, this policy in the United States was repealed. There are no regulations governing throttling anymore.

Note that many ISPs now advertise “up to” speeds instead of a firm number. The old Russian proverb that was made famous by then President Ronald Reagan during nuclear disarmament talks is one that you should think about following when discussing internet bandwidth– “Trust, but verify.” You should check your speed regularly at different times of the day.

Purchasing higher bandwidths than the minimum you require can compensate for many of these problems but not for all. It is doubtful that everybody will have a problem with each factor, but you should be aware because one or more of them will crop up.

So, What Do You Need?

For our analysis we are going to assume a small business with five internet connected devices and two internet phone numbers. All of the units are used simultaneously. We recommend that the phones be located between the modem and your router. This way the phones will receive internet priority over other equipment.

Larger businesses may need three or more phones. You will probably want to have calls routed. There are phones systems designed for the internet and business use. Businesses have many options to choose from. You may be able to use your existing phones also. In either case, you would probably want a consultant to review your equipment, needs and then make setup recommendations.

From our experience, you would probably want a bandwidth of two megabits per second (Mbps) for each device or ten megabits (Mb) total in our example. Remember, anything connected to the internet (computers, laptops, tablets, cell phones, Wi Fi printers etc.) will take up bandwidth. Wi Fi applications will require slightly more bandwidth than wired devices. Also, you will need to make adjustments depending on your business. For example, if you are a radiologist sending pictures to other locations, you will need more bandwidth since x-rays utilize a great amount of data. One internet phone company recommends an upload and download speeds of at least 384 kilobits per second (0.375 Mbps) per phone. Our total would therefore be 10.75 Mbsp. Rounded off to the next higher level is 11 Mbps. Do not forget to allow for any future growth.

Due to bandwidth throttling, it is recommended by some Voice Over Internet (VoIP) companies that you multiply your final amount by 5 to 10 times. Ten times eleven is one hundred and ten megabits. Depending on the ISP, you would either have to buy a 150 or 200 Mb plan. Do not buy less than five times. If you do you may not be leaving yourself enough of a safety margin to compensate for the unexpected. ISPs will deny the possibility, but my own measurements indicate that bandwidth can slow down by as much as 50% at certain times of the day. This makes your 150 Mb stream actually a 75 Mb download. Upload would probably be less. This still gives you an adequate safety margin. Many ISPs have speed categories as low as 50 Mb. If this level of service is cut by 50%, you will have an effective speed of 25 Mb. This level is more than sufficient for everything except phone service. Even though voice uses less bandwidth than other internet functions, you still have the chance of spotty outcomes because voice is more perceptible.

I have also tested the ping (latency of one data packet) response of my system. At times the ping is above normal. Only once has it been above 150 ms. However, this does indicate a latency problem either in my equipment or somewhere in the internet network. It is difficult to tell where. All this proves, however, is that these factors can and do happen.

Phone service is very important to many businesses. You do not want to give customers a poor experience by having spotty service. You should not take the risk!

Some ISPs offer an integrated phone system along with their internet installation. As a general rule, I would prefer to keep my phone system a separate entity from my ISPs internet connection. If you have trouble with one, you will not have trouble with both. Furthermore for phone service, some ISPs require you to only lease their equipment. This leaves you with no choice in the matter and exorbitant leasing fees for equipment that is usually “old” technology that is not up to present day standards.

Fax Machines

It is very common for businesses to make extensive use of Fax machines. You should be alerted to a problem that exists with Faxing over the internet. Faxing over the internet is not 100% reliable some of the time. The same is true for optical fiber lines. The reason has to do with the fact that Fax machines were developed for regular copper landlines. Copper landlines are fairly lossless. As we have mentioned, dropped packets are common along the internet and also on fiber lines. Faxes are not resilient to dropped packets.

For those with optical fiber installations, the public is told that the changeover from copper is seamless. From the reports that I have seen and from neighbors, this is not completely true. Most problems that I have heard about relate to Fax machines that functioned properly when on a copper line and would not function properly on fiber. The data losses on fiber are greater than copper and highly dependent on installation.

You may not have a problem with occasional Faxing. However if your business is highly dependent on Faxes, it might be advantageous to keep a copper landline solely dedicated to your Fax machine.

What Is Best?

So what is best five or ten times or something in between? No one could answer that question but you. You don’t want to spend more money than you need to. The only way to be sure is to test. Start out low. Allow plenty of time to make a conclusion. If you need more speed, you usually can buy more. Of course an exception to this would be if you deem any additional costs worth the safety margin. Then by all means go for the higher bandwidth. Whatever you do, you will probably find the total cost of VoIP is much less than conventional telephone systems. Many times it could pay for itself in short order. Determine what is best for your company yourself.

If you have any further suggestions, do not keep it to yourself. Help your fellow readers!

If you have any questions, comments or suggestions drop me a line at

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