Hosted Voice

by Dave Michels

Hosted Voice is a fascinating space and it is just getting started. Hosted voice, enabled by VoIP, started around 2005. The most well known pioneer was Vonage – but that was more conceptual in that the were always consumer focused. Hosted voice generally refers to business oriented PBX features aimed at business accounts.

Over the past five years, that industry has more or less matured and played out. Hosted Voice service providers generally sell their services for about $30-$50/mo/user and offer a variety of PBX like services. It was fairly wild-west a few years ago as any fool could offer the service at any price – but alas the weaklings have been mostly weeded out.

That is what I am calling hosted 1.0. Largely voice centric selling basic VoIP features against largely obsolete incumbent phone systems.

We have learned in the past five years is hosted voice does indeed work. As a result, larger companies are getting interested – and that includes carriers, service providers, and CPE makers. We are starting to see consolidation and acquisitions by surprising players – including Comcast buying New Global Telecom (NGT), Cbeyond buying Aretta, and Google snatching SayNow.

We are also seeing the traditional CPE makers getting into the hosted space – both directly targeting service providers to buy/use their technology as well as directly establishing a new hosted offering (Mitel, SEN, Interactive Intelligence). This has significant ramifications.

Hosted 2.0 is going to be a different game. Hosted 2.0 is going to be much more around UC, aimed at larger companies, and using private networks. Hosted 2.0 is also known as UCaaS – and it invites yet more and bigger players. Microsoft’s Office365 has a hosted play, Skype is also surprisingly well positioned as is potentially Google if they decide to play. As with the case of CPE, I expect hosted voice to become more focused on a broader solution set, particularly around collaboration.

I have several projects underway and will be posting more about hosted voice. Such as this piece which is mostly hosted 1.0 aimed at SMB:

Hosted Solutions for SMB

It’s good to be a small business. That may be true for lots of reasons, but I am referring to the current telecom environment. The choices for telecommunications solutions have never been greater, more powerful, or so reasonably priced. It’s a buyers market too! VoIP technologies eliminate geographical limitations, so service providers across the country are vying for Main Street business. But selecting a provider isn’t simple – not only are they difficult to compare, but offer wildly different approaches to voice and unified communications.

Hosted voice services have been on the market for about eight years. The services basically run $30-$50/month/user and typically involve key features geared at SMB users. Most services offer unlimited calling in the US and Canada, voice mail, and a variety of advanced features available through a web portal. The providers generally do not include the actual bandwidth required – that is businesses will need to obtain quality, high-speed broadband separately in order to use a hosted voice service.

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