The Evolution of Business Telephony. Authored by Jon Arnold from J Arnold & Associates
"...new technologies can take years or decades to gain mass adoption."
In today’s digital world, where workers have a multitude of options for voice communication, it’s hard to imagine a time when desk phones were the hub of everything in the workplace. With the rise of switched telephony in the 1970s, the PBX became the de facto standard for enterprise voice communication, and remained that way until the Internet revolution.
Before PCs came along, there were no practical alternatives to telephony for real-time or near real-time communication, and with that, PBX vendors had a very lucrative business model. The Internet ushered in the age of digital communication - most notably email and VoIP - and that’s when things began to change.
Being packet-based instead of circuit-switched, VoIP enabled voice communication over data networks. Technology-wise, this meant that telephony no longer required a dedicated – and costly – voice network to support the PBX, and with that, phone systems were no longer the only way to do voice communication.
Independent of VoIP’s emergence, cellular telephony provided yet another option to desk phones. In theory, both innovations – VoIP and cell phones – should have marked an abrupt end to the PBX’s dominance (and its successor, the IP-PBX), but both are prime examples of how new technologies can take years or decades to gain mass adoption.
Both offered advantages the PBX could not counter, namely much lower cost telephony with VoIP, and the convenience of mobility with cellular. Conversely, both were hampered by immature technology that prevented them from providing business-grade quality. Before broadband became the norm, data networks lacked the throughput needed for real-time communication, making VoIP an inferior option to PBX.
Similarly, cellular networks were far less reliable than the PSTN, and along with the high cost of handsets, this form of voice was not suitable for business other than for emergencies. Combine this with the rock-solid quality and durability of the PBX, there was little reason for businesses to consider alternatives for something so critical to the business.
"Sometimes change is abrupt, and sometimes it’s gradual."
Sometimes change is abrupt, and sometimes it’s gradual. The latter is the case here, as the above-stated limitations of the new technologies took some time to evolve. While VoIP may not be fully on par with the PBX, the quality and reliability now is more than adequate for businesses, and is clearly the successor technology to the PSTN.
VoIP can, in fact, deliver a superior experience to legacy telephony, and with today’s technology, that is the reality. More importantly, for many years now, VoIP has become accepted for business use, and that represents the real break point for PBX being the standard for telephony. Given the durability of PBXs, they remain in widespread use, but are now primarily VoIP-based, and known as IP-PBX.
In this regard, VoIP has actually extended the PBX’s lifespan, but the technology also supports other forms of hardware-based telephony. PBX vendors – and others – have long been offering a wide-range of SIP-based phones that do not require a Capex-driven infrastructure. Today, telephony has become almost entirely software-based, meaning that the intelligence has shifted from the handsets to the VoIP platforms, and with that, the cost of endpoints has fallen dramatically.
Over time, PBXs will disappear as they finally reach end of life, but desk phones remain alive and well. The lower cost of VoIP-based telephony means that more businesses can afford to have the rich capabilities that only enterprises could previously afford with the PBX. Desk phones are no longer used as extensively as in the past – for many reasons – but they still have lots of utility, and are no longer out of the price range for smaller businesses.
Perhaps just as important, another big change was the ability of data networks to support voice communication. Once the challenges of routing real-time voice over these networks were solved (latency, jitter, etc.), new options opened up for businesses.
Early on, Skype was the first example of doing this at scale, and since then PC-based voice has taken over, and is arguably now the dominant mode in the workplace. This option takes several forms – softphones, click-to-call, webchat, and of course being core to all UCaaS platforms – and overall, represents another set of options for voice communication alongside the trusty desk phone.
Yet another big change is mobility. As wireless carriers evolved from 3G to 4G and now 5G, mobile broadband has turned smartphones into today’s hub for getting work done. The pandemic gave rise to hybrid work, and with landlines becoming a thing of the past, home-based workers now depend on their smartphones just as much for work as for their personal lives.
"...more businesses can afford to have the rich capabilities that only enterprises could previously afford..."
Along with telephony evolving from hardware to software, businesses have been migrating from on-premises solutions to the cloud. This shift applies across the board – not just telephony – and now most workplace applications are cloud-based. With digital transformation, voice has become another data application, and is now embedded in just about every cloud-based platform, most notably UCaaS, CCaaS, and CPaaS.
"...voice has become another data application..."
None of these technology shifts will change course any time soon, and it’s important to note that they move in lockstep with how workstyles are evolving. Digital natives now dominate the workforce, and their communications preferences differ from older generations. That said, multi-generational workforces are the norm, which means that IT leaders must support a wide range of technologies to keep everyone engaged.
All things considered, it’s fair to wonder if there’s any future for desk phones. With everything going to the cloud, is there any need for physical telephony infrastructure? In a mobile-centric world, what would compel anyone to use a desk phone? The death of the desk phone has long been debated, and these are all valid questions. However, telephony vendors are still posting strong shipment numbers, and new models keep coming to market.
If the future of telephony was dictated solely by technology evolution, the desk phone would have disappeared long ago. There are now plenty of business-grade options for voice, either telephony-based or otherwise. One could even argue that if desk phones were suddenly taken away, nobody would miss them.
"Voice is the most natural, human form of communication..."
Ultimately, the persistence of desk phones - and the need for telephony - lies in human nature rather than technology. Voice is the most natural, human form of communication, and for many scenarios, it’s the most effective. With so many scenarios for using voice, there are valid use cases for each mode, including desk phones. Not all workers are at a desk, but in most businesses, many of them are, and where voice is core to their workday, desk phones are often the best mode.
Whether doing internal or external calls, desk phones generally provide the best user experience. To name a few, the form factor is far more comfortable than a smartphone, the phones are always powered, audio quality is always good, no endpoints are overheating, conversations are private without the need for headsets or ear buds, and workers can easily multitask with their screens and whatever is on their desk.
In terms of modern workflows, IP-based phones integrate natively with PC-based UCaaS, and can facilitate handoffs to/from mobile devices when workers need to work away from where the desk phone is tethered. All told, there are still plenty of great use cases for desk phones, especially those with screens that support messaging and video.
For IT leaders, the main takeaway here is that desk phones should not be an either-or decision. Given the low cost for today’s desk phones, there is little downside to continuing having them, even if not extensively utilized. Just because desk phones aren’t used as much as before, doesn’t mean that voice – telephony or otherwise - is somehow less important now.
Both video and text-based communication are very much on the rise, but they will never displace voice-only communication. Rather, desk phones and telephony should be viewed as one of many communications options for the workplace, and by providing workers with a full set of tools, they can only be more productive.
"...the value of conventional telephony very much persists..."
The key is to let employees decide which mode is best for each workplace need, rather than have the PBX vendors control the narrative for voice communication, even when other options exist. For IT leaders considering whether to keep their telecom infrastructure in place – especially with so much cloud momentum – this bigger-picture perspective should make it clear that the value of conventional telephony very much persists, and that it should not be determined by the state of technology evolution alone.
As Principal of J Arnold & Associates, Jon is an independent research analyst providing thought leadership and go-to-market counsel with a focus on the business-level impact of disruptive communications technologies.
