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VoIP Softphones

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Introduction to VoIP Softphones

A VoIP softphone is a software program that enables making phone calls over the internet using VoIP (Voice over Internet Protocol) technology. Softphones allow connecting a headset to a computer or mobile device to place and receive calls rather than using a traditional hardware desk phone.

Definition of VoIP Softphone

Like a regular phone, a VoIP softphone provides a means to dial numbers and communicate bilaterally over a network. However, instead of using circuit switched telephone lines, a softphone sends and receives call data as packets over an IP network. This allows routing calls over the internet rather than a conventional public switched telephone network (PSTN).

To use a softphone, the device running the software must have a broadband internet connection enabled by technologies like cable, DSL, fiber optic, or WiFi. A microphone and speakers built into the device facilitate the voice call. For best quality, a USB headset can be connected.

Leading providers of VoIP softphones include RingCentral, Nextiva, 8×8, Ooma, and OnSIP. These solutions integrate calling capabilities into desktop and mobile operating systems.

Evolution from Traditional Landline Phones to Internet-Based Calling

The introduction of VoIP technology in the mid-1990s enabled converting analog voice signals into digital data for transmission over packet switched networks. This paved the way for internet-powered phone services.

In the 2000s, high speed home and office broadband along with improving call quality allowed consumer VoIP services like Vonage and Skype to gain adoption. Subsequently, businesses began to adopt on-premise VoIP private branch exchanges (PBX) that linked IP phones over local area networks.

With the proliferation of mobile devices and WiFi connectivity, softphones emerged as a convenient way to equip laptops and smartphones with a business phone identity. This enabled mobility and remote working capabilities not possible with desktop IP phones alone.

Today, softphones have become an essential component of unified communications for businesses. They integrate seamlessly with VoIP phone systems to extend connectivity anywhere with an internet signal.

Explanation of Different Types of Softphones

There are several categories of softphones:

VoIP Softphones: These are softphones designed exclusively to connect a PC, smartphone or tablet to a business VoIP phone system over the internet. They are preconfigured to register to a company’s VoIP platform and come with a business phone number. examples include RingCentral app, Nextiva mobile app, 8×8 Work app.

SIP Softphones: These softphone apps use SIP (session initiation protocol) to handle VoIP call signaling and can be used with any SIP-based VoIP service or SIP account. They provide more universal compatibility across different types of VoIP systems. Popular SIP softphones include Bria Solo and Acrobits Groundwire.

WiFi VoIP Softphones: These integrate into devices’ native WiFi calling and dialing to route calls over WiFi networks. For example, an iPhone or Android device could use a WiFi VoIP softphone instead of cell minutes when connected to WiFi. Some examples are Line2 and Talkatone mobile apps.

Features of VoIP Softphones

VoIP softphones contain a suite of essential calling capabilities on par with dedicated VoIP desk phones. They also provide distinct advantages related to their software-based delivery.

Comparison with Traditional Landline Phones

Like a regular landline phone, softphones enable:

  • Making and receiving calls by dialing phone numbers
  • Call hold, transfer, forwarding, conferencing
  • Visual voicemail and reading of voicemail transcripts
  • Do not disturb mode and call blocking
  • Outbound caller ID configuration
  • Speakerphone and mute modes
  • Integration of contacts/address books
  • Keypad for dialing extensions and navigating auto attendants

However, softphones deliver these features over the internet rather than a local telephone network. This enables global connectivity and extended capabilities.

Flexibility and Mobility

Softphones provide excellent flexibility for businesses to equip personnel across multiple locations and devices:

  • Mobility to use calling features on smartphones, laptops, and tablets from anywhere
  • Remotely control desk phone line from mobile or home office
  • Single number identity across mobile and desk phone
  • No need to install physical desk hardware at new sites
  • Scale to new employees quickly by just assigning softphone licenses

Cost-Effectiveness

With softphones being software-based, they avoid the cost of deploying physical IP desk phones. There is no need for phone wiring within offices either. Calls traverse the internet, avoiding per-minute long distance charges levied by telecoms.

Ongoing costs are limited to softphone application fees or bundled licenses. This runs far less than maintaining and upgrading hardware IP phone inventory.

Integration of Various Calling Features

Softphones integrate neatly with cloud VoIP platforms to enable accessing a robust suite of calling features:

  • Auto attendants and interactive voice menus
  • Smart call routing to employees, queues or auto attendants
  • Custom on-hold music and greetings
  • Voicemail to email for convenient message access
  • Call analytics for tracking effectiveness
  • CRM integrations for call data and screen pops
  • Video calling and screen sharing

Benefits of VoIP Softphones

VoIP softphones confer significant advantages to businesses when it comes to improving communications, operations, and the bottom line.

Enhanced Communication for Businesses

Softphones enhance internal collaboration within organizations by keeping employees seamlessly connected regardless of device or location. They facilitate quicker coordination via voice calls or chat messages versus email chains. Video softphones further improve interactive collaboration.

Externally, mobility allows sales teams, executives and support agents to connect reliably with customers from anywhere via their business identity. This provides a competitive edge.

Global Connectivity

Softphones enable assigning business phone numbers from virtually any country to mobile devices. For global companies with distributed teams, this facilitates low cost international calling and consistent branding.

Scalability and Flexibility

Cloud VoIP platforms integrated with softphone apps can scale up or down easily to adapt to organizational changes. There is no need to install new desk hardware or cable offices when opening new sites.

Employees can also access business phone communication tools from home offices and shared workspaces with only their laptop or mobile device, increasing flexibility. IT administration is centralized rather than distributed.

Cost Savings

Softphones eliminate spending on physical IP phone handsets and wired infrastructure. They bundle software PBX capabilities with no hardware. Calls are routed over the internet, bypassing conventional call charges.

Ongoing costs are predictable based on the number of softphone licenses. This is far more affordable than maintaining an inventory of desk phones and PBX hardware.

Market Trends and Analysis

The VoIP softphone market has witnessed steady growth fueled by the demand for mobile-first, flexible software solutions for business communications.

Growth of the VoIP Softphones Market

The global market for VoIP softphones is predicted to grow at a CAGR of close to 11% from 2019 to 2024, approaching a value of USD 5 billion according to analysts such as ReportLinker.

Key factors driving growth include the proliferation of mobile devices, adoption of BYOD policies in enterprises, and rising remote working trends which increase reliance on softphones. Demand is strong across North America, Europe, and Asia Pacific.

Major Players and Market Share

RingCentral holds the highest market share in the VoIP softphone segment. Other top providers include Nextiva, 8×8, Vonage, LogMeIn, Microsoft, and Dialpad.

Established vendors are maintaining dominance through high quality apps, strategic partnerships, and bundled UCaaS offerings. However, new entrants are driving innovation around mobile-centric features and integrations.

Regional Analysis and Market Size

North America accounts for the largest regional share of the VoIP softphones market driven by a high density of multinational corporations headquartered there. Europe follows closely. Asia Pacific represents the fastest growth given expanding enterprises.

In terms of revenue, the North American VoIP softphones market already exceeds USD 1 billion in value and will likely double in scale over the next five years. Europe’s market sits around USD 850 million currently. Asia Pacific should surpass USD 700 million by 2024.

Pricing and Competitive Landscape

Most providers do not sell softphones as standalone products. Instead, softphones are bundled as part of a unified communications or VoIP phone system plan. This simplifies pricing into a per user-per month model based on features.

Basic softphones start around $10/month. Advanced UC bundles with integrated video collaboration can range from $25 to $50+ per user monthly. Approximately 10% of UCaaS revenue is attributed specifically to inclusion of softphone capabilities according to analysts.

The market remains competitive. Switching costs for customers are low. This results in providers racing to maximize features and integrations that boost mobility, convenience, and ease of use across platforms. Commoditization pressures pricing down.

Technical Aspects of VoIP Softphones

There are some key technical considerations that enable VoIP softphones to deliver reliable, high quality calling over IP:

Energy Efficiency and Scheduling Schemes

VoIP softphones are designed to be battery friendly, especially on mobile devices. Efficient audio encoding minimizes processor and network bandwidth usage.

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