Even in this age of omnichannel communications, every business needs a decent phone service. Many customers still like to get in touch this way—and with modern cloud-based systems, you’re not restricted to making and taking calls on desk phones.

The best business phone services give you flexibility by combining voice with video and messaging channels to improve customer experiences and collaboration between team members.

In this post, we’ll tell you everything business owners should know about the different types of phone service and their benefits—and present a rundown of the best systems.

A business phone service is a multi-line telephone system used in a business environment. Apart from the ability to make and receive phone calls, it typically comes with call management features to help companies streamline their workflows and offer professional customer support.

These might include essentials such as call forwarding and call waiting, or advanced features like call recording, call routing, and caller ID. Modern business phone providers offer virtual and VoIP phone services that operate in the cloud and are integrated into a unified communications platform with video conferencing, SMS, and team messaging.

Some business phone services also come with an integrated contact center, plus analytics so that you can track call duration, hold times, wait times, and overall usage.

You’re probably aware that there are two main types of business phone systems, but let’s take a closer look at how they work.

Virtual phone system

Also known as a virtual PBX or cloud PBX, this type of system operates in the cloud instead of on physical equipment in your office. (PBX stands for Private Branch Exchange, which is a private telephone network used within a company or organization.)

You don’t need to install or maintain a server or have wiring installed for each phone line. The only hardware you need are desk phones and/or computers and mobile devices—in many cases, employees can use their own. Your business phone service provider owns the software, which you lease via subscription, and takes care of maintenance and updates.

On-premise phone system

This is the traditional type of PBX system, with a server installed on your premises and physical phone lines coming in. Back in the day, it would have run on analog lines, but today an on-prem system can support VoIP (voice over internet protocol), where calls are made using the internet, just like a virtual system does.

The downside is the high upfront installation cost, plus the fact that you ideally need IT staff to maintain the equipment. And if you want to add extra users, you’d have to ask the phone company to install new landlines.

Again, this depends on what you want the system to do for your business. Larger companies with more employees will need more advanced settings, while smaller firms might want to start with the essentials and scale as they grow. However, there are some key aspects that all businesses should look for:

1. Features
2. Pricing
3. Reliability
4. Support

Let’s look at each in more detail:

1. Essential features every small business phone service should have

The array of features offered by different vendors can be pretty overwhelming. You must choose the right ones for your business needs—does the system have enough functionality? Can you add more features as you grow? It’s good to involve all the employees using the system and ask them which features would make their lives easier.

Here are some examples of essential features

Auto-attendants

Sometimes referred to as a virtual receptionist, an auto-attendant is an automated tool that answers inbound calls to your business phone number when there is no one available to take the call.You can program it with custom greetings that inform callers of your opening hours, direct them to other departments, or invite them to leave a voicemail. The benefit is that the auto-attendant can work 24/7, offering a professional welcome for every call.

Multiple phone lines

As we mentioned earlier, virtual phone systems eliminate the need for physical wiring, which makes it much easier to get set up and to add extra users when you need to. The other advantage is that you can use just one business number, no matter how many devices, extensions, or locations you have. And you can manage multiple lines with handy features like call routing, forwarding, and ring groups.

Call routing

Call routing is essential for a busy office or call center. An intelligent routing systemensures that incoming calls always get to the right person or department—based on agent availability, idle time, specialist skills, or the round-robin method. Smart routing improves productivity and customer satisfaction, reduces call queues and increases the likelihood of first-contact resolution, even when you’re facing a high call volume.

Support for mobile devices

Your phone service needs to work smoothly on mobile devices. It gives everyone more flexibility, and you can operate a BYOD model if desired. Just make sure that the mobile app has the same features as the desktop apps, and ensure everyone has access to the same tools and documents for team collaboration.

High call quality

This is absolutely essential, not just for a professional appearance but for workforce efficiency and customer satisfaction. If calls regularly drop out, then customers and staff will become frustrated, while participants can miss key details of conversations. When the audio (and video) quality is clear, there’s no risk of repetition or miscommunication. Choose a system that gives you top quality calls to anywhere in the world, on any device.

UCaaS integration

When you look into VoIP or cloud-based phone solutions, you’ll see that many of them are integrated with a UCaaS platform—standing for unified communications as a service. But what exactly does that mean?

What is unified communications?

It’s when all your communications tools—voice, video, text messaging, group chat, online faxing—are brought together in one package and accessed from one central interface. The concept streamlines workflows and boosts productivity because you don’t have to toggle between a bunch of separate apps. UCaaS often includes dedicated contact center modules and typically integrates with your other business apps.

Essential components of a unified communications system

i) Business VoIP

VoIP stands for Voice over Internet Protocol, which basically means that phone calls (and other communications) are transmitted via an internet connection instead of the copper wires used for traditional landlines. The technology turns audio signals into digital “packets” so they can be sent and received over an IP network. Business VoIP is usually cloud-based and gives you the flexibility to operate from anywhere, with cheaper calling than traditional systems.

ii) Video conferencing

Video meetings are a key part of unified comms. It’s easy for everyone to be seen and heard, and you can share visual material and even collaborate on documents in real-time. Video is also ideal for live training sessions, webinars, and even 1:1 calls. You can get more from a conversation when the participants can see each other, and it helps you get to know colleagues in other locations.

iii) Team messaging

Team messaging (also known as group chat) is also great for collaboration, especially for remote teams who can’t just call out ideas or questions across the office. Because all group members can view and reply to every message in a neat thread, it’s easier to keep everyone on the same page. You can share files and images within the thread, and set up different groups for different teams.

iv) SMS

SMS text messaging is just as useful for business as it is for chatting with friends outside of work. Recipients can instantly see the notification and respond equally quickly. SMS is also good for sending bulk messages to customers, such as reminders, updates, and offers.\

2. Pricing considerations when choosing small business phone systems

Pricing is an important factor whatever the size and budget of your business. You need to investigate potential providers carefully, to make sure their pricing is transparent and there are no hidden extras that will end up costing more than you anticipated.

You’ll want to ensure that your chosen system is going to be affordable on a long-term basis and that it gives you a good return on your investment. Check whether the pricing structure is easy to understand. Are there several pricing bands to choose from? Is the fee based on the number of users? Is there a discount for paying annually rather than monthly? Do you have to pay for any add-on services?

Here are some pricing concerns to take into consideration:

a) How much does a business phone line cost per month? Does the provider offer plans that are good value for money? Value for money means different things to different businesses, as it depends which features and capabilities are necessary for you to do your job. Make a list of wants and needs, then compare the price plans of different providers. Look at the cost of business lines for a traditional phone service, but also check out the subscription model of cloud vendors. Do they set the price by the number of users or extensions, or is it a flat rate?

b) What are the initial deployment costs? The cost of deployment largely depends on whether you opt for an on-premises system or a cloud-hosted PBX, but there are some other costs to consider.

• Hardware (VoIP phones/Business phones) - If you’re intending to run a physical office, you’ll probably need desk phones. You can buy specialist IP phones designed to carry VoIP calls, but it’s also possible to use your existing traditional phones with VoIP adapters—or to use computers and mobile devices as “softphones” with headsets and mics. 8x8 has a range of equipment to suit various budgets. For an on-premises system, you’ll have to install and maintain your own servers, which can prove expensive. You also need physical phone lines, including extra ones when you add a new employee. Cloud PBX removes the need for any of that.
• Software - Again, the software cost depends on what type of system you choose. With a virtual version, the software is owned by the vendor and housed in the cloud. You just download an app to your device, the cost of which is covered by your monthly fee—as are any upgrades, which are rolled out automatically. With on-prem, you could decide to buy your own software, but you’d need an IT team to maintain it.
• Installation - As we’ve mentioned, an on-premises PBX requires servers to be installed at your office—you’ll definitely need help for this, whether it’s your company’s own IT department or external experts. Analog phones need to be wired in by the phone company, whereas VoIP business phones only have to be plugged in.
• With cloud-based systems you can download the apps in minutes, but if you own the software, it has to be installed on each device. Configuring it to your preferences should be simple, but check that your vendor offers onboarding or support should you need it.

3. Ways to ensure your provider’s reliability

It’s crucial that your phone system is reliable. Your business needs to look professional at all times, and that’s not possible if you’re constantly experiencing dropped calls or patchy audio! When researching communications solutions, look at the provider’s SLAs for uptime, call quality, and the security of your data.

Here are some tips to ensure your provider’s reliability:

• Check customer reviews - It’s always good practice to learn about other users’ experiences with a provider—and online reviews give you information on everything from call quality to customer support. How easy was the system to set up and use? Did they require training or IT assistance to customize the features? Were there any issues with billing? Check out genuine reviews rather than just testimonials from the vendors’ own websites.
• Review their SLA - Checking the vendor’s SLA (service level agreement) is essential, as it gives you a good idea of what kind of service to expect—and what will happen if the provider fails to deliver. You need guarantees for uptime and call quality, so that you can run your business with confidence. 8x8 has a 99.999% uptime SLA, and the system is designed with no single point of failure, multiple redundancy and rerouting capabilities.

4. Factors to consider when choosing a business phone system that can support your business needs

Even with the most reliable of providers, it’s still good to have the reassurance that great customer support is there if you need it. Pay attention to the terms and conditions, as they may vary between pricing tiers. Are you covered around the clock, and in different time zones? Which channels are available? Is there an extra charge for priority support? It’s also worth checking whether the vendor offers onboarding and training to get everyone up to speed.

Here are some factors to consider:

• Business size - Virtual phone systems are capable of supporting any type and size of business, but there are some further considerations that will inform your choice of provider. Some of the prices will hinge on the number of users and extensions you need, so make a list of everyone that needs access to the system.
• It’s also worth thinking about the future­—are you planning to expand, taking on more employees or doing a lot more international calling? The good thing is that cloud VoIP phone systems are highly scalable and enable you to go remote, so there’s no need for large expensive premises even if you employ more people.
• Compatible devices - We’ve already discussed the use of IP phones or analog phones with VoIP adapters, both of which are compatible with a virtual phone system. If you’re planning to use softphones rather than desk phones, you’ll need to think about whether your computers and mobile devices are sufficiently up-to-date for the software apps. It’s best to look for mobile and desktop apps that run on all operating systems. Plus, it’s worth considering headsets and mics for video or audio conferencing.
• App integrations - It’s important to have plenty of integrations so that you can use familiar tools with no time wasted in switching back and forth between them. As well as benefiting from increased productivity, you can build a scalable tech stack and introduce new apps as you grow your business. Several business phone systems integrate with Microsoft Teams, Google Workspace, and CRM apps.

8x8 is a virtual phone system with everything your business needs to communicate and collaborate—all in one place. As well as VoIP calls, the platform includes video, team messaging, business SMS, and contact center capability. But it’s a step up from unified communications— 8x8’s XCaaS, or eXperience Communications as a Service, is designed to give employees and customers the best experience.

To that end, there are advanced call management features such as auto-attendant, visual voicemail, and smart call routing, as well as built-in analytics and integrations with popular apps like Salesforce, Zendesk, and Slack. The affordable Essentials plan includes unlimited calling in the US and Canada, while superb call quality, security, and customer support are guaranteed.

1. Improves internal communication and collaboration

By having all your tools in one place, you’re giving your employees plenty of ways to communicate better. In the cloud, everyone can access the same system from wherever they are, which is ideal for collaboration between in-office or remote/hybrid teams. They can use the video conference feature with screen sharing and whiteboarding, share files in the group chat, or use SMS for a quick conversation. Faster communication leads to better productivity and fewer misunderstandings. And if your business plans to expand, it’s easy to stay in touch with colleagues in other locations.

2. Can be integrated with contact and call center technology

If you’re running a contact center, it makes total sense for it to be integrated with your business phone system. All the call management features that help your office run smoothly are super-handy for contact centers with a large volume of calls: smart routing, call queueing, voicemail, auto-attendants, IVR menus. But it’s not just about phone calls—customers should be able to contact you on the most convenient channel, and agents should have the means to answer all inquiries quickly and effectively.

With 8x8, the XCaaS concept is aimed at making life easier for agents and customers alike. The easy-to-use system with tools like call logs and automated dialing helps agents meet their targets and minimize stress, and enable customer feedback. There are also analytics to measure KPIs and spot opportunities for improvement.

Choosing a business phone service can be a daunting prospect, with so many providers on the market. We’ve narrowed down the options to show you six of the best:

1. 8x8

With HD voice and video calling, group chat, text messaging, and an integrated contact center, 8x8 has you covered for every type of business communication. Port your existing number for free, or choose a new one for your new system. You can buy business phones and equipment, too, although no hardware is needed to get started with the 8x8 app.

The XCaaS platform provides great user experiences, including advanced call management and real-time analytics and intelligence. Launch audio and video calls with a single click right from the chat thread, and customize your tech stack with integrations and APIs.

Security and compliance are paramount, with a two-factor authentication system and certification for HIPAA, GDPR, and FCC requirements. Don’t forget the 99.99% uptime SLA, with geo-redundancy ensuring ultimate reliability. All plans come with great support including a live chatbot, comprehensive online knowledge base, complete implementation services, and employee training.

Selected features:

• Voicemail transcription
• Instant screen sharing
• Personalized greetings
• 8x8 Work apps for iOS, Android, and web
• 24/7 expert support in 90 countries

2. RingCentral

RingCentral MVP is a unified communications platform with message, video, and phone. It’s simple to add and remove users and set up routing from the central console. On the downside, there are extra charges for international calling, with calls to countries outside the US and Canada charged per minute.

MVP is reasonably priced, with plans starting at $19.99 per user per month for Essentials. This covers up to 20 users, and gives you unlimited calls in the US and Canada, team messaging, and SMS/MMS. However, it’s still more expensive than 8x8’s basic plan—and doesn’t include video meetings or an auto-attendant.

Upgrade to Standard ($27.99 per user per month) for unlimited audio conferencing and e-fax, but only 100 video meeting participants (8x8’s second tier allows 500). The two higher-priced plans include analytics and advanced call handling, with discounts for more than 100 users.

Selected features:

• 100 toll-free minutes per month
• Automatic call recording
• 24/7 live chat and phone support
• Mobile apps for iOS and Android
• Contact center option

3. Grasshopper

Only available in the US and Canada, Grasshopper is aimed at small businesses that don’t require advanced features. That makes it simple to set up and use—just link your cell phone, then choose local or toll-free numbers or a vanity number for business calls.

You can set up greetings and after-hours messages, voicemail, and basic call routing. Features include business SMS, online fax, and 24/7 customer support, and you can add a virtual receptionist for an extra charge. If you miss a call, Grasshopper will automatically send an SMS message to say you’re unavailable.

All features are included in all plans, with prices depending on the number of extensions. The Solo plan ($29 per user per month) includes one number and three extensions. The Partner plan ($44 per month) seems expensive for just three phone numbers and six extensions.

• VoIP/Wi-Fi calling
• Virtual faxing
• Mobile and desktop apps
• Call transfers

4. Nextiva

Nextiva is an all-in-one platform that offers all the essential phone system features, but be aware that several of them—including text messages, conference calling, and voicemail transcription—are only available in higher tiers.

There are three pricing plans, but the cost will depend on the number of users. For example, the Essentials tier is $23.95 per user per month for 1-4 users, coming down to $17.95 if you have 100+ users. There’s also an a la carte option to build your own plan, and you can opt to add a contact center. The Essentials Plan includes 1:1 video calls, internet fax, and team messaging. There’s no SMS/MMS, and the only integrations are with Outlook and MS contacts. The Pro plan allows you to use the Nextiva app, although it doesn’t have advanced call management or call center capability, while international calling is limited to the US, Canada, and Puerto Rico. Remember, 8x8’s top tier has unlimited calling to 48 countries.

Selected features:

• Voicemail
• Call routing
• Apps for Android and iOS
• 24/7 phone and live chat assistance

5. Vonage

Like Nextiva, Vonage is a unified comms platform with three different plans, whose rates are based on the number of lines you need. All levels have unlimited calling, SMS and team messaging, but some features are only available as add-ons so the cost could soon mount up. These include toll-free numbers, and prioritized customer support.

The Mobile plan lets you make and receive calls from mobile phones and desktop computers, which suits businesses that don’t need physical office phones. It’s $19.99 per month per line for 1-4 lines, falling to $14.99 for 20-99 lines.

If you want additional features like call recording, visual voicemail, and CRM integration, you’ll need the Premium or Advanced plan. Premium allows calls from any device, starting at $24.99/month/line, while Advanced starts at $34.99. Both of these limit video meetings to 100 participants, as opposed to 500 with 8x8’s higher tiers. And neither includes unlimited international calling.

Selected features:

• Keep your existing number
• 20+ integrations
• Call monitoring
• Virtual receptionist
• 24/7 chat support

6. Ooma Office

Ooma is a phone system aimed at smaller businesses. It’s easy to set up and customize, and to add extra users and devices. Both its plans include unlimited calling in the US, Canada, Mexico and Puerto Rico, one toll-free number, and low international rates.

The cheaper of the two plans, Ooma Office, has SMS messaging, audio conferencing, and a number of call management features like voicemail, ring groups, and call forwarding. It’s not a bad price at $19.95 per user per month, but doesn’t include video meetings like 8x8’s lowest tier.

The upgrade ($24.95 per user per month) is Ooma Office Pro, which adds video conferencing and voicemail transcription alongside call recording and a desktop app. The website has a handy rate calculator tool that estimates your taxes and fees based on location.

Selected features:

• Hold music
• Call transfer
• Call blocking
• Mobile app
• Virtual extensions

Whatever type or size of organization you’re running, the right business phone service will help you stay professional, boost efficiency, and keep employees and customers happy. As we’ve mentioned, there are plenty of vendors to choose from, all with pros and cons—so make sure you look carefully at their record on call quality, reliability, security, and customer support.

You won’t be surprised to hear us say that 8x8 is the standout choice, with its raft of advanced features at an affordable price. The HD voice and video quality, coupled with 99.999% uptime SLA and excellent support, gives you the confidence to expand your business—while the XCaaS concept ensures the best experience for everyone involved.

Are business phone systems secure?

Yes, the top VoIP providers are committed to keeping your data secure. It’s always a good idea to look closely at your vendor’s security protocols and compliance certification—for example, 8x8 offers end-to-end security and state-of-the-art data centers.

Can I upgrade my traditional landline phone system to a VoIP or web-hosted system?

Yes, you can convert your landline phone system to an online VoIP system, and even use your existing analog phones with a VoIP adapter. All the top business phone companies make it easy for you to keep the same business phone number when making the switch.

How long does deployment take?

It depends on the provider and your own business setup, but cloud phone systems are usually very fast to deploy. Once you’ve signed up for an account, just download the apps, customize your settings, plug in your IP phones or adapters, and you’re good to go. On-premises systems will take a while longer as you have to configure a server and install physical phone lines.