Going mobile: Hosted VoIP extends PBX mobile functionality to the SMB
As smartphone capabilities, wireless bandwidth and VoIP services expand and take hold of the market, a slew of affordable unified communications options are emerging as the mobile phone becomes the office phone of choice for an increasingly mobile workforce. One of those options is the extension of PBX functionality--the voice calling, conferencing, and other features of a desk phone--to the mobile device.
The trend is growing: Last week 8x8 announced a lower-cost version of its Virtual Office Solo that includes a mobile application as part of its service, and recently, UC software provider Mitel highlighted an integrated IP voice application for mobile users. Other hosted VoIP service providers such as RingCentral are rolling out similar software-based services that allow customers to not just forward calls to their mobile phone, but actually deputize the mobile device as a full-featured office phone outside the office.
Big deal, some mobile users might say. But until recently, unless a company had an enterprise-level service that included a gateway to push office phone functions out to its employees' handsets (à la RIM), users were pretty much limited to forwarding their office phones to their mobile phones with no additional functions available.
Now, small to medium sized business (SMB) owners looking to cut costs by subscribing to a hosted VoIP service for their voice needs can also add to mobile devices the same calling features that the IP phone sitting on their desk has, enabling them to essentially take their office communications mobile.
PBX extension woes
"These offerings that extend PBX functionality have been around a few years now," says Stacy Crook, Senior Research Analyst at IDC. "We started following the market in 2006 and it seemed like something that was going to take off. The market has moved a bit more slowly than we expected, and I think there's a few reasons for that. There's definitely some challenges in deploying these systems."
Two factors held back the expansion of VoIP-to-mobile services, she says. First, the migration from legacy PBX to IP PBX has taken some time and "a significant portion of companies" don't have IP PBX infrastructure. Second, the mobile market in 2006 wasn't ready for rapid expansion.
In 2006, "executives had Blackberrys (but) the average person did not have a smartphone. You could use mobile PBX extension products on feature phones, but in order to take advantage of the cost savings that are offered from the dual-mode capabilities, you really need a WiFi capable device," Crook says. "Now it's pretty common for a new smartphone to have WiFi on it, but that wasn't necessarily the case until the past year or two. Obviously one of the key benefits to deploying this solution is cost savings, and one of the ways you can get cost savings is by using the WiFi to cell handoff capability. A number of pieces had to come into place in order for this solution to be deployed broadly in an organization."
Hosted VoIP finds a niche
RingCentral, which provides hosted VoIP to the SMB segment, offers a mobile extension as part of its all-inclusive subscription service. "With the app for iPhone, Blackberry and Android, users can see their voice and fax messages, extension dial from the company directory and even see their call log. So you can actually--you're starting to use your smartphone device as your primary business phone," said Senior Director of Marketing for RingCentral Nisha Ahluwalia.
Ahluwalia sees businesses, particularly single owner-employee small businesses, shifting toward a more mobile environment. "...a lot of our customers (are) seeing a blending between their cell phone and their desk phone. ... What we've found in the market is that with the explosion of mobile users and WiFi you have an incredible shift in the market of business workers, knowledge workers being more mobile, working out of the office, working from the road. You're seeing that trend in the industry," said Ahluwalia in an interview with FierceVoIP.
Disruption in the market looks to be a key point for smaller hosted VoIP providers, who operate in the shadow of bigger IP-based communications providers like Verizon that focus more on the large enterprise. Price is a key component: RingCentral's business subscription starts at $24.99 while its mobile-only subscription is $9.99.
VoIP provider 8x8 also sees a ripe opportunity to target the SMB mobile niche, particularly one-person operations. The company recently announced Virtual Office Solo, a one-user business VoIP service priced at $7.99 and offering many of its Virtual Office hosted VoIP capabilities.
Explains Debbie Jo Severin, CMO and VP of marketing for 8x8, "One day we were sitting around and said, hey we're targeting those seven million business customers out there that have business offices and multiple employees where a PBX function is really important, and we're offering these UC capabilities for mobility, but there's probably 13 million ‘solopreneurs' or home office (based) single employee businesses out there that are not always going to be single employees.
"Taking a lesson from Intuit who does a great job of going after the entrepreneur and startups, onto Quickbooks--we said, what can we do to be very disruptive in the market, offer a service that's very similar to our Virtual Office in terms of the core capabilities, the call functionality and telephone features, UC features and mobile features, but are serving just a one-person (office), and get them off of Skype and Vonage and over to 8x8? And therefore if they grow, they're a perfect candidate for our hosted PBX offering."
The providers' downloadable PBX extension apps for iPhone and Android devices provide a value-add for small business owners, many of whom have limited or no office space or spend much of their day on the road.
As demand for PBX extension to mobile devices continues to grow--IDC's Crook points out that 74.4 percent of the U.S. workforce in 2011 is mobile either all the time or for some part of the day--so will the number of VoIP providers offering a software-based service. "I think it takes time to build up the proper infrastructure, and perhaps that's why there aren't a breadth of hosted offerings in this market yet, but I certainly expect it to move that way. Every company wants to do that."
She also sees PBX extension gateways becoming integrated features of both on-premise and hosted IP PBXs, with pricing becoming more competitive. "This is still an emerging market and there's still a lot of business to be had. So I think that the vendors are going to make this as cost-effective as possible."