IP vs Digital Phones

A communication system is the heart of success for any business, no matter the type or size of the company. Telephones are the essential bridges for communication between you and your clients. The company has to make sure that their executives are easily available or accessible to the customers whenever required.

Today, there are normally two communication choices available to choose from. One is the IP phone system and the other is digital phones.

IP Business Phones

IP phones are phones that send voice data over the Internet. IP phones are also referred to as VoIP system (Voice over Internet Protocol). It is basically a combination of hardware and software that enables voice communication to take place over the Internet network. The voice is transmitted in the form of data packets using IP rather than traditional transmission techniques that use PSTN circuits.

Digital Business Phones

Digital business phones are the traditional type of phone system that makes calls through the phone line or PSTN. PSTN is the wired phone system over which telephone calls are made. This type of phone relies on circuit switching. To make a call from one phone to another, the call is routed through a number of switches operating at various locations.

Comparison Between IP Phones and Digital Phones

Cost Factors

Initial installation cost of IP phones might be higher compared to digital phones. But, in the long run, IP phones save a good amount of money. Because the communication medium is the Internet, the call rates are generally lower or sometimes free – as decided by the data plan you choose. To switch to IP phone network, some additional hardware is required.

Installation cost of digital phones is lower compared to IP phones but the call rates are on the higher side. The call rates in digital phones are roughly 40% higher for local and long distance calls and up to 90% more on international calls. Again, in terms of running costs, digital end devices consume a little more power. IP phones end devices mostly get power from the Ethernet connection. Although some costs are incurred for installation, network and other functionalities, IP phones save a lot in running costs and thus have a better return on investment.

Portability Option

IP phones are more portable compared to digital phones. IP phones can be moved from one table to another without affecting the connection or the extension number. Even if the office is shifted to a different place, simply plugging the power and Ethernet cable will start up the system with same number and extensions. All you need an Internet connection. In case of digital phone system, shifting is not possible without the help of the phone service provider.

Management and Maintenance

Remote access is possible in IP-based phones and hence technical issues can be solved without the service provider being physically present at the site. With digital phones, it is mandatory for the service personnel to visit the site first and then rectify the issues that have occurred.


In case of IP phones, the bandwidth is shared between phones and computers in the office. As a result, the system may get slow and affect the performance. So, if the Internet connectivity fails, the phones will not work. Digital phones have advantage over IP phones as separate lines are provided for them and therefore remain unaffected with problems in the Internet. However, precautions are available for IP phone systems such as back-up Internet connections.

Choosing between IP and Digital Business Phone System

Choosing your business phone system depends on the need and specification of the company. If a large number of phone calls are made and you have a well-equipped network infrastructure, it is beneficial to go for the IP phone system.

About PhoneAM

PhoneAmerica Corporation is a leading supplier of advanced telecommunication systems for small and large business environments. A total service company, PhoneAmerica serves as a single point of contact for today’s growing communication needs, offering a wide range of telephone equipment, wiring, surveillance systems, telephone cost accounting systems, and voice processing systems.

Please call (800) 836-3601 for a free evaluation of your current system and the system you will need to carry your business into the FUTURE.

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