10 Key Differences between a Physical Phone and a Virtual Cloud Phone: Which one should you choose?

Telephony used to be merely telephones and telephone numbers at one time. Things have changed since then. In today’s world, telephones are no longer simply boxes for incoming and outgoing calls. Today’s telephone systems (VoIP phones/virtual cloud phones) are more advanced and come with an array of additional functions than their predecessors (physical phones/POTS).

POTS (Plain old telephone service) vs. VoIP (Voice over internet protocol) is one of the most widely discussed topics in the telecom industry today. Therefore, this article aims to make a comparison of both telephone systems based on several factors.

Even though these two telephone systems each have benefits, and they may be suitable depending on your organization’s needs, using a VoIP phone is often less expensive than using a traditional analogue phone. Nonetheless, it is important to know the difference between them and what they each deliver at an enterprise level.

Before understanding the key differences between the types of phone, namely a physical phone and a virtual cloud phone, it is essential to understand more about the operating system on which each telephony operates. 

Since virtual cloud phone falls under VoIP telephony and physical phone under POTS, this article will examine the key characteristics of each of these systems before identifying the key differences between the phones:

Voice over Internet Protocol (VoIP)

VoIP refers to voice over internet protocol, a technology that transmits voice data over the internet. This phone service allows users to make voice calls ‘virtually’ through the internet rather than using traditional phone lines or landlines.

In the VoIP service, your voice is converted into a digital signal transmitted over the internet.  When you make a regular phone call, the signal is converted to a telephone signal upon reaching the destination.

Using VoIP, you can communicate directly from a computer, a special VoIP phone, or an ordinary phone connected to a special adapter. Moreover, you can also access the internet and use VoIP service wirelessly in airports, parks, and cafes with wireless access points.

Because VoIP calls require internet access, the internet connection must be stable with enough bandwidth. To meet this requirement, it is essential to have a broadband (high-speed internet) connection.

Cable modems and high-speed services such as DSL and local area networks can be used for this purpose. Many VoIP services support computer or VoIP phone usage, while other services are compatible with traditional phones connected to a VoIP adapter.

You can also buy special VoIP phones that can plug directly into your broadband connection and function largely like a traditional phone. When using a phone with a VoIP adapter, you’ll be able to dial as you always have, and you may also hear a dial tone from your service provider.

Benefits of Virtual Cloud Phones

1.     An all-in-one location

Since virtual cloud phone systems can integrate with different business applications, such as CRM, email, etc., they offer greater versatility. This increases overall productivity by enabling businesses to manage all their processes from one place. For instance, CRM systems can display customer data whenever a customer calls your virtual phone number. To unleash this feature, however, you to integrate CRM software on your cloud telephony system.

2.     Direct cost savings

Since virtual cloud phone only requires a good internet connection to operate, businesses can save massive initial costs in the name of business phones and PBX hardware. This is because the onsite installation of a PBX can range from a minimum of 500 to 2000 dollars per user.

Also, virtual cloud phone doesn’t require extra capital investment for the installation of copper wires. That money can easily be saved with the installation of a cloud phone.

3.     Scalable system

VoIP offers a great deal of scalability, and the system allows you to easily expand or reduce the size of your business. The use of traditional analog phone signals becomes increasingly expensive as a business grows as it requires capital costs for installing the infrastructure, maintenance costs, and operational expenditures.

In contrast, a virtual cloud phone does not require your business to incur additional equipment expenses or call volume-related expenditures as it grows. Virtual cloud phone systems like KrispCall are offering number sharing features to an unlimited group of agents. So it won’t require much time, effort, or capital investment to convert your solopreneur business into a large call center.

4.     Highly advanced business features

Virtual cloud phone consists of multiple features such as instant messaging, IVR, customized greeting messages, voicemail transcription, etc. These features enhance the ability of a business to communicate with each other and their customers at ease.

5.     Flexibility

Virtual cloud phone offers the same level of versatility and mobility as mobile phones, if not more. There is no need for employees to be physically present in their offices to receive calls or access the system. The VoIP protocol can be used with softphones, hard phones, or video conferencing equipment.

It is primarily because virtual cloud phones are directly associated with the users and not with physical locations. By incorporating such features, employees can remain productive regardless of where they are working.

Plain Old Telephone System (POTS)

The old telephone system (POTS), also known as an ordinary telephone system, is a voice-grade telephone system that transmits analog signals over copper loops. We all grew up with phone line technology in our homes, and it’s exactly what it sounds like: copper wires hanging overhead carrying our voices from one place to another.

Originally, POTS networks were developed to facilitate voice communication over copper cable networks that crossed continents and countries. From the 1880s to the present, it has been the standard voice-grade telephone system used in homes and businesses worldwide. In reality, the POTS we’re familiar with is an improvement over the phone system invented by Alexander Graham Bell.

In all this time between its creation and now, very few changes have been made to the POTS system. Copper phone lines operate even today by creating a dedicated circuit between two points of transmission. Although the operator no longer connects the two parties manually, the automated switching operates similarly.

Benefits of Physical Phones

1.     Well established technology

A fair amount of modification has been made to Alexander Graham Bell’s analog telephone technology since it was first introduced. It is a well-established concept supported by a well-established technology platform and a worldwide network of wires connecting even the most remote locations.

Even though analog end-points may not always be relevant, the technology is understood well, and for now, it is regarded as a preferred method of communication even in commercial settings.

2.     Powerless Operation

One of the biggest advantages of physical phones over a virtual cloud phone is that the handset continues to function even if power is lost. This is because the carrier provides the power directly to the landline rather than to the end-user. However, VoIP-enabled devices such as laptops, mobile phones, etc., will not work if the power is out for an extended period as they will be completely drained out of battery.

This means that your building will still be able to use the telephone line even if the power goes out in a storm or under any other circumstances, which is particularly helpful in an e911 emergency.

3.     Simple to use

In terms of installation, POTS devices or physical phones are very simple because this two-wire telephone service does not present any complexity. Moreover, the phone handsets are extremely simple to operate.

However, this is because it lacks many of the features offered by newer Internet-based voice communication technologies.

Virtual Cloud Phones Vs. Physical Phones (POTS)

Although POTS offers unique advantages, it is swiftly losing market share to modern technologies like virtual cloud phones that work on the internet. However, comparing the two modes of communication from a technological standpoint may not be entirely fair.

Virtual cloud phones have a huge head start because it was designed to integrate business applications that, almost without exception, operate over the Internet. Nevertheless, physical phones were built at a time when the supporting infrastructure was not as advanced.

Now that you have a good understanding of virtual cloud phones and physical phones, let’s examine some of the key differences between the features provided by them:

FeatureVirtual Cloud PhonesPhysical Phones (POTS)
Voice TransferTransmits voice signals from one place to another by converting input voice signals into digital signals.Transmits voice signals from one place to another by converting input voice signals into electrical signals.
ConnectivityNo need for existing infrastructure Utilizes the same packet-switching technology as Internet services No need for specialists in infrastructure support.Uses its dedicated infrastructure Uses circuit switching technology Specialists needed in infrastructure support
CapacityUsing and releasing bandwidth as needed. Upgrades usually involve updating software and adding extra bandwidth to the existing network.After the call is established, bandwidth is reserved until the call is finished. In general, upgrades require purchasing more lines and more hardware. Such an upgrade can be  very complex and costly.
BandwidthCommunication between two devices usually requires 10 kbps in each direction.Communication between two devices usually requires 64 kbps in each direction.
AdaptabilityIn case of a power outage, calls will either be forwarded to a pre-determined alternate device (such as a cell phone), or they will go to voicemail.Power outages won’t affect the system except for cordless handsets
Call management featuresNo additional cost is required for using the call management features such as call waiting, call forwarding, etc.An additional cost is required for using the call management features such as call waiting, call forwarding, etc.
Emergency CallingEmergency service can’t trace your emergency call.Emergency services can trace your emergency call.
Remote ExtensionThe remote extension is easily available.A remote extension isn’t easily available as it needs its own dedicated line.
Multimedia TransferIt supports all multimedia transfers such as audio, video, images, etc.It doesn’t support multimedia transfer at all.
PricingPricing is independent of time and distance. Fee VoIP to VoIP calls. Businesses can save up to 60% each month.Pricing is dependent on time and distance. No free PSTN to PSTN calls. Local calls are usually cheap, whereas international costs are very high.

Physical Phone and a Virtual Cloud Phone: Which one should you choose?

New technologies can seem complicated to users, and this is one of the reasons why some businesses are reluctant to adopt virtual cloud phones. Traditional physical phones may seem easier to use than virtual cloud phone, but it certainly has some learning curve attached to it. Virtual cloud phones, however, support business growth and expansion more than traditional physical phones. Additionally, newer technologies such as VoIP are phasing out older systems, making it more difficult to upgrade or procure spare parts.

Lastly, organizations are increasingly adopting virtual cloud phones over traditional physical phone lines as they operate at a comparatively low cost. This comparison of virtual cloud phone and physical phone (POTS) we provided hopefully helped you make an informed decision. So make a wise choice understanding the budget, business requirements, security, and reliability yo