The Small Business Phone
by Phillip A. Sherman for
The Arizona Business Gazette

Back in the days when Ma Bell reigned supreme, businesses only needed to make one phone call to handle all their telephone needs.

Of course, one source meant little choice in what office phones could do. "Black or beige phones?" was about the only choice given to businesses calling "The Telephone Company." Being a monopoly gave AT&T and its various subsidiaries a tremendous amount of power.

Luckily for businesses in America, things have changed. Today choices abound when it comes to the selection of a new telephone system for businesses. Manufacturers and vendors from every high-tech country in the world produce and distribute a wide variety of products well-suited to today’s business environment.

But with the abundance of choices come other challenges. With the integration of computers and telephones, many businesses are concerned with the choice between fully digital systems and analog systems. For most business, the choice is complicated by price and functionality considerations.

By understanding some of the differences between the two technologies, a business owner or manager can make an informed choice with a minimum of torment and confusion.

Analog Systems

Ever since Alexander Graham Bell spoke the first words over his new invention, analog systems have been with us. Put quite simply, analog systems keep your voice intact as it travels along telephone lines or wires, unlike a digital system, which changes your voice to a digital code.

If you could "see" your analog voice, it would look the same anywhere on that particular pair of wires, whereas on a digital system, it would look like a continuous stream of pulses. This technology has evolved over the years to provide a dependable format for modern telephone products.

Most of the telephone systems sold prior to 1988 were highly analog in nature. The exceptions were digital systems used by very large companies. Just like the modern computer, these analog systems have evolved into today’s modern electronic key systems with features that resemble the most sophisticated digital systems, without the added cost of digitizing speech.

Advantages

1. As a general rule, analog systems cost less than their digital counterparts. This is especially true of small systems, 16 phones or less, when the economy of scale doesn’t apply.
2. If your business utilizes fax machines, cordless phones or answering machines, which are mostly analog devices, you will find it easer to interface with your business telephone system if it is analog. Digital systems must use equipment called "analog adapters" to talk to analog devices. This can add hundreds, or even thousands of dollars to the cost of your system.
3. The analog systems of today provide most of the feature flexibility of digital systems.

Disadvantages

1. For the most part, analog systems cannot interface with some telephone company features such as Caller I.D. If your business needs this feature, better go digital. Also, as other sophisticated data services become available, your analog system may not be compatible without some modification.
2. If you need to send voice and data simultaneously over your business telephone system, an analog system will create enough problems to give the average business owner or manager migraines. For example, if your order entry department needs customer files to appear on the computer when that customer calls in, go digital.
3. As new feature packages become available from your system’s manufacturer, upgrading the system may be difficult because system features have almost always been built and are not removable or changeable. This depends more on the type of analog system than on the technology.

Digital Systems

Advances in computer technology have had a dramatic effect on business telephone systems. A fully digital telephone system is basically a computer that thinks it’s a telephone system.

Your voice is converted to a stream of digital pulses, much like that used by a computer. Since the format is basically the same, digital systems can communicate easier with computer systems.

Advantages

1. Like digital stereo and television, digital telephone systems offer high voice quality. This tends to be noticeable in buildings where noise is a problem or the building is old.
2. Since digital systems are, for the most part, computers, new and improved feature packages can be added. Most digital systems have provisions for adding new feature packages as they become available.
3. As the telephone operating companies offer more digital services such as Caller I.D., digital telephone systems will be able to interface with them. Also, if your company needs to link your computer system or it data to your telephone system, a fully digital system is the only way to go.

Disadvantages

1. Digital telephone systems are more expensive, usually between 20 to 30 percent higher than analog.
2. As easy as it is for analog systems to work in harmony with other types of office equipment, a digital system can offer expensive challenges when connecting to fax machines or standard single line phones. Usually, digital systems will require proprietary single line phones, which will be more expensive to purchase.
3. Some digital telephone systems "lock" you into one company’s line of products. For example, you may want to add voice mail in the future. Some manufacturers limit your choices to their technology and charge more than another product made to do the same job.

The best way to ensure that you get the right product for the money is to work with a telephone system vendor that understands and is willing to take the time to explain the workings of both types of products and how they differ.

In addition, make sure that your vendor understands the workings of your company, not companies similar to yours. Since it is you and not the vendor who is making the purchase decision, be sure that you understand why you are purchasing a particular product, whether analog or digital.

Remember, if in doubt, ask questions. Keep in mind your particular rate of growth when selecting your system. Nothing is worse than having to replace your entire system because you failed to project your company’s growth rate.

The right selection of a new telephone system can provide years of trouble-free service for you and your employees. And after all, isn’t that what choice is all about?

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© 2002 Telecom Advisors Group, Inc., all rights reserved.