VoIP Vs. UCaaS: Understanding The Differences


VoIP Vs. UCaaS


Brian Wallace, Founder & President, NowSourcing

Voice over internet protocol (VoIP) is a powerful communication alternative to traditional phone lines. In fact, businesses can save an average of 32 call minutes every day with VoIP, as well as save between 30% and 50% in total expenses on average. And, since VoIP is software-based, it can also work with software systems to facilitate multiple communications channels, most notably, Unified Communications-as-a-Service (UCaas) — a new type of VoIP-based business communications software. Not only does UCaaS offer advanced voice calling features, but it also facilitates a host of business communications, including text messaging, video chat, and screen sharing. 

What is VoIP?

VoIP is a digital telephone service that uses the internet and a headset to make and receive calls. Although VoIP can connect with desk phones and public switched telephone networks (PSTN), it’s not reliant on this hardware. Softphones with cloud-based software, Google Android smartphones, Windows Phones, and Apple iOS are all VoIP-compatible. In turn, easy communication is better facilitated. Not only does VoIP offer all the standard features of regular landlines (such as, voicemail, caller ID, call forwarding, and Do Not Disturb), but it goes further to also offer call logs, holds, recording, monitoring, and transcriptions, auto-attendants, number porting, and dial-in conferencing. Additionally, virtual phone numbers are also possible with VoIP, which allow businesses to either use a local number or memorable vanity phone number (1-800-YOURBUSINESS) to expand reach. It also offers remote call forwarding, which enables you to forward an incoming call to another preferred number. If the line is busy, this feature can help ensure the calling customer is automatically put through to an available operator on a different line. 

Nonetheless, that’s not to say traditional landlines don’t still have their place. Corded phones offer a level of reliability that makes them an attractive communication solution even in today’s digital world. Since landlines use a wire connection, you can rest assured your service will be consistent and not spotty. For businesses, a solid connection is vital to overall efficiency and ensuring customers can reach you when needed. Landlines also usually remain up even in extreme weather conditions, therefore helping your business avoid unnecessary downtime. 

What is UCaaS?

UCaaS improves productivity by 85%, boosts innovation by 82%, and facilitates decision making by 84%. In addition to voice, UCaaS offers a host of other channels, including video calls, which is particularly useful for remote teams. It also offers business chat solutions, a text-based communication method (similar to instant messaging) that lets team members share info and ideas instantly via a chat app. UCaaS also enables screen share: a conferencing tool that lets employees share their desktops/smartphone screens — which is particularly valuable during PowerPoint presentations or software demonstrations, for example. Moreover, UCaaS packages typically also offer useful project management tools to let managers assign employees work and monitor progress. 

UCaaS vs VoIP: what’s right for you?

VoIP and UCaaS are both effective at improving business communication. In fact, they’re typically paired together by many providers. RingCentral, for instance, combines VoIP and UCaaS features in all their plans. Nevertheless, VoIP alone does limit you to only voice calling, along with basic features like virtual numbers and caller ID. Alternatively, UCaaS typically integrates VoIP calling into its comprehensive communications solutions packages, allowing you to chat with employees before switching seamlessly to a call or video call with just a few quick pushes of a button. UCaaS does, however, usually demand an initial hardware investment, although it’s also often used by remote workers (34% of employees who started working from home in 2020 did so using UCaaS, an MIT study found). Nevertheless, if your business communication needs are relatively straightforward and you don’t need the collaboration features offered by UCaaS, VoIP will meet your needs for less money.  

It’s also worth noting both VoIP and UCaaS run on SIP (session initiation protocol). SIP is essentially a signalling protocol used to establish data connections between two or more participants. VoIP relies on SIP to establish and connect calls to PSTN networks, while UCaaS also heavily relies on it. Most UCaaS packages, for example, use SIP to open and close connections involved in file sharing, chat, or even sending tasks via workflow software. So, in turn, as VoIP and UCaaS are both SIP-reliant, they’re also often interconnected and you can ultimately benefit from a more comprehensive and stronger business communications strategy by opting for a provider offering both technologies. Again, however, if your business simply isn’t in need of UCaaS’s numerous collaboration features, a basic VoIP system will be a more affordable option.

VoIP and UCaaS are both powerful business communication solutions. By taking time to consider your requirements and weigh up your options, you can make the right choice for your business communication needs. 

Brian WallaceAbout the Author: Brian Wallace is the Founder and President of NowSourcing, an industry leading infographic design agency in Louisville, KY and Cincinnati, OH which works with companies ranging from startups to Fortune 500s. Brian runs #LinkedInLocal events, hosts the Next Action Podcast, and has been named a Google Small Business Adviser for 2016-present. Follow Brian Wallace on LinkedIn as well as Twitter.