Feature: Why, years after the hype, VoIP for businesses is hot again
Suddenly the time is right says Jamie Coombs, group professional services manager at Altodigital.
It’s not often that a technology gets a second wind so why is a solution that first entered Gartner’s Hype Cycle way back in 2006 suddenly taking off again as if it were the next big thing?
According to Gartner, although it first emerged in the mid-1990s, Voice over internet protocol (VoIP) only entered its ‘early majority’ phase of adoption in 2015. Yet, last year it was predicted that the global VoIP market would grow by a compound annual growth rate of over 9.7% until 2023. Away from the global stats and assessments, Altodigital itself is seeing a real upswing in demand, selling on average around 30% more seats per month than last year – and this figure looks set to rise.
Inevitably, the global economic downturn played its part in delaying widespread adoption but why the slow burn followed by resurgence now? The answer has much to do with the availability of fast, inexpensive broadband. Initially, only large enterprises could afford the high-speed connections required so late adopters of technology who tend to look for proven success with metrics to show any early hype has substance, shied away from its implementation. Although VoIP does work over the more traditional copper broadband, it will struggle with more than 20 users. However, the emergence of fibre-optic, super-fast broadband, now almost universally available, has brought more favourable rates.
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Researchers at IDC have now estimated that a VoIP system can deliver a 30% reduction in telephone related expense – Altodigital has witnessed its SMB customers cutting their phone bills by at least 25% following their migration to VoIP.
Now, even more so than in 2006, SMBs have very few avenues to explore when it comes to making these kinds of operational savings as many have become leaner and more streamlined, with cost-cutting opportunities few and far between.
Call costs over VoIP networks are significantly cheaper than traditional calls, largely because of the more recent reduction in data carriage costs, but also because hosted providers can often offer a bundle deal, inclusive of a large volume of calls. IP to IP calls can often be made free of charge and as VoIP adoption stops the need for traditional telephone infrastructure, there are no long-term hardware lease or maintenance charges.
Another major driver is the maturity of remote working. Smaller businesses have much to gain from the flexibility of mobile working by being able to work anywhere in the same way as they would if they were in an office. However, very small businesses often suffer from an image problem if key employees are unavailable to prospective customers when out of the office. Yet as VoIP enables them to use their landline number and diverts calls to a mobile phone, it means they can maintain the professional image needed if they wish to compete with larger organisations. It also means one number will reach multiple different offices or locations – ideal for a small service provider with a highly publicised number.
Alongside the flexibility comes the functionality that opens up many new cost-saving opportunities. Video conferencing via Skype and other features such as call recording can now be included within the VoIP bundle.
For example, businesses can now hold important weekly sales meetings through Skype and then look to only physically meet face-to face once a month. This not only saves on travel costs but on time usually taken up by journeys to attend the meeting which adds further resource back into the business.
Another feature highly popular with SMEs is VoIP’s reporting capability, which provides valuable data they may have only dreamed of having when using a conventional system, enabling more accurate budgeting and planning.
Even in our business lives we have become frustrated by restrictive and expensive long-term contracts once offered by traditional telecoms providers. However, such are the savings of VoIP that some providers will buy their customers out of existing leases and offer competitive bundles to save on costs.
Suddenly, it’s hard to imagine why any business wouldn’t want to migrate to VoIP.
Mambu and the UAE’s digital banking journey
Miljan Stamenkovic enjoys the dynamic and constantly evolving world of fintech banking. In his current role as General Manager for MENA for Mambu, Stamenkovic sees opportunity in abundance.
“When I joined Mambu with my team in 2019, we came with the fintech, entrepreneurial mindset and DNA to build and grow Mambu’s business in the MENA (Middle East and North Africa) region. Before 2019, the region used to remind me of a desert, at least in terms of cloud service providers and cloud adoption. But this past year has been a wave of progress.” In November 2020, Mambu opened a new office in Abu Dhabi Global Market, as the region has quickly become a key market for Mambu.
He explains, “There are data protection laws. There are cybersecurity regulations and most importantly, a variety of major tier one cloud service providers that are available. But what particularly excites me here at Mambu is the opportunity to rethink business models together with our clients and really bring them to life. This is where I saw a great fit with Mambu and its composable philosophy.”
Creating a neobank and challenger bank ecosystem has been his ultimate goal. “In my opinion, this actually creates a unique opportunity to partner with some of the best fintechs in the region and build the region’s first and true challenger and neobanks.”
Stamenkovic credits Mambu’s partnership with Banque Saudi Fransi (BSF) for the success that has driven the bank forward in the region. “When I think about all the challenger and neobanks that have grown massively over the past decade,there is one common denominator for all these new initiatives. I would say they really operate like a tech company rather than a bank. - BSF is leading this approach in Saudi Arabia.”
He continues, “This brings a competitive advantage for tech companies. These platforms are each managed individually but can be swapped in and out. And when put together, they actually form the backbone of a company's technology capability. This is why tech companies and banks like BSF actually can get products to the market a hundred times faster than their more incumbent peers.”
The implementation, he stresses, is an evolving process, where each component is trialled and checked and swapped in and out according to its effectiveness. But it’s down to the dynamism of the team on the project to initiate these changes. “As critical as technology is to digital transformation, the DNA of people working on these initiatives is the key to success. At BSF they have a true startup and entrepreneurial mentality.”
He explains that Mambu is helping BSF deliver an entire new banking experience while providing soft core banking services hosted, in this case in Saudi Arabia. “Mambu sits at the heart of BSF's new challenger bank and its technology stack. So, this actually enables BSF to take an entirely cloud native approach, having Mambu at the centre of its ‘Digital Engine’.”
Stamenkovic points out, “Mambu enables banking like a modern tech company. Banks used to be built to last, but today they need to be built to change. And that's what we're enabling here.”