Traditional Phone System: How It Works, When It Makes Sense & How Much It Costs

Traditional phone systems were established in the late 1800s and have remained mostly unchanged since that time. A traditional phone system work by sending electrical pulses on copper wires to transport audio from one phone to another.

Analog phones rely largely on their actual copper wire network, which is difficult and costly to maintain.  The telephone service provider or carrier may only offer a few basic features such as caller ID, voicemail, and call-waiting with analog systems.

As a small to medium-sized firm, you’re probably approached by several phone providers about various phone technologies. How can you cut through the clutter to discover the best service provider for your needs?

This article will provide a brief review of classic phone networks, their costs, and their advantages.

What Is A Traditional Phone System?

‘Legacy system’ is another term for a conventional phone system. It is powered by a physical box (“brain”) at the company’s headquarters that is wired to each phone. 

The number of users and the number of outside lines necessary to conduct outgoing calls determine the cost of these premise-based devices. 

These systems also require the use of several cards, based on the number of users and telephone lines. Companies with multiple locations necessitate the use of multiple “brain boxes.” If the business expands after the original purchase, a specialist must manually upgrade the hardware to accommodate new users.

Private Branch Exchanges (PBX) were developed to allow businesses to conduct internal conversations between employees without utilizing the public telephone network. These systems make use of analog telephone wires.  In most situations, a PBX entails a physical rack of hardware and phone lines on your company’s premises.

How Do Traditional Phone Systems Work?

Phone lines or lines are other terms for a traditional phone system. Without real cables, these lines cannot accept outgoing or incoming calls, which is why any office that uses phone services must have the appropriate cords. 

Landline phones, on the other hand, can be semi-cordless–the handset is wireless, but the phone base has cables. The wireless handset or receiver can only be used within a limited distance from the phone base. 

Although mobile phones and other contemporary communication services are more popular than landlines, these devices remain one of the world’s best technologies, because high-quality phones continue to function properly after decades of use.

Listed below are the benefits of a traditional phone system.

Benefits Of Traditional Phone Systems

1. No Bandwidth Requirements

According to an online study of the global digital population, there were 4.66 billion active internet users globally in January 2021, accounting for 59.5 percent of the global population. 92.6 percent (4.32 billion) of this total used mobile devices to access the internet. 

About 5% of the world’s population, or 16 million individuals, does not have access to the internet. 

Digital phone service for a small workplace requires 100 Kbps per line, which may be more bandwidth than is available. High bandwidth used to be more expensive in terms of the equipment required for analog electronic data transfer, therefore costs for all data transmission methods were based on bandwidth needs.  To save money, no more bandwidth was purchased than was necessary for any specific application.

Since analog phones operate from a physical structure (copper wires), there is no need to worry about internet access or the amount of bandwidth.

2. Availability

Landline phones offer the advantage of time. Prior to the invention of the telephone, it was impossible to converse by voice across any distance. 

The invention of the landline telephone in 1876, along with the telegraph a few decades earlier, transformed communications, paving the way for the sophisticated computers we carry in our wallets and purses today. 

The telephone is considered one of the significant inventions that helped improve living standards.  The inflation-adjusted GDP per person rose from US$1,200 in 1870 (in today’s dollars) to more than $10,000 per person today.

Telecommunications infrastructure was constructed by telephone corporations for reach rather than speed, however. It works for voice calls alone.

3. Superior Reliability

Even in the case of a calamity or power loss, analog phones can continue to function. For this reason, firms that rely significantly on communication still use an analog system. 

Landline phones are excellent at what they are designed to do: place and receive calls. A landline phone can connect you to other numbers at nearly any time and under almost any conditions, as long as it is physically linked to the network.

4. Call Quality

Although wireless and VoIP infrastructure has advanced significantly in recent years, consistent call quality remains a key problem for wireless callers worldwide. 

Even today, when cell phone use has become widespread, the great call quality on analog phones makes landlines a very appealing option.

Although cell phone coverage is typically dependable in most metropolitan areas and suburbs, it might be lost in more rural or mountainous locations.

5. Legacy Equipment Integrations

Some legacy devices, such as outdated alarm systems, require analog telephone connections to work correctly.

While adapters can alleviate this problem, they are not always the ideal option because they might interfere with the equipment’s vital information transfers.

Analog telephones are the preferred option if preserving legacy equipment is a priority.

6. Recording System

The absence of aliasing distortion and quantization noise; the broad dynamic range; and performance in overload circumstances are all advantages of an analog recording system. Meanwhile, digital systems offer higher audio recording quality and are easier to integrate with personal computers and software programs.

One downside of using landlines rather than VoIP is the inability to use CRM. As a result, you may have to do it manually when it comes to recording and tracking business calls. Alternatively, you will require different tools for your phone system to multitask.

Traditional Phone Systems: Infrastructure Needs

Most traditional phone systems have a limit to the number of phones they can support before needing to add more ports by purchasing more of the same equipment. When you require more call capacity, you’re back to the same dilemma of needing to acquire more costly, obsolete, and featureless equipment.

If you are not adding more staff to your company, but rather more customers, growing call traffic may be a problem for you and your old phone system. 

Inadequate incoming and outgoing phone lines cause a busy signal, which leads to hang-ups and, eventually, lost money. Again, the only way to fix this problem with a standard phone system is to add ports.

The ideal PBX phone system for your company may be heavily influenced by your present infrastructure. Consider the following:

• Do you have an in-house IT department?
• Are they familiar with telecommunication principles such as SIP trunking?
• What telecom solution are you currently using?
• What legacy systems must be integrated with your new telephone solution?
• Do you work from a single office or a network of offices?

The good news is that your company is growing. The bad news is that when this happens, many organizations outgrow their infrastructure and require a system capable of handling increased call traffic, extensions, and data passing across the network. 

With a typical system, adding additional office locations may be a headache because new building locations necessitate the purchase of new equipment.

Traditional Phone Systems: One time/Monthly Costs

Use of the phone lines will be charged to you monthly by your phone system provider. 

The cost of an analog phone system is determined by the size of the business and the additional services desired. Business owners must consider both setup and maintenance expenses, which vary based on the number of employees and the type of system used.

According to research from 2017, these expenses average around $7,600 per year. Individual handsets cost approximately $200 apiece.  Keep that in mind if you want to expand your workforce.

Traditional phone systems can only be used with dedicated phones and cannot be accessed remotely via an app, so you’ll also need to purchase desk phones for your staff.

Each phone hardware may cost up to $250 (US), while phone systems can cost up to $1,000 (US). Consider how many VoIP lines you could have with that kind of money!

However, the aforementioned expenses only cover basic and conventional phone line setups. Other services, such as call queue, call transfer, intercom, and so on, maybe necessary if your company sends and receives calls. 

In addition, you may need to set up a Private Branch Exchange, which is an in-house and private telephone network (PBX). Because repairs and alterations may need the assistance of professionals, this option is likely to cost you thousands of dollars.

Traditional Phone Systems: Limitations

1. Mobility

Unlike VoIP, which uses the Internet and the cloud to relay calls, landline systems assign unique numbers to each phone line or mobile phone. As a result, people who are on the go will be unable to accept calls outside of their offices. 

Additionally, if you relocate your office to another state, you will need to obtain a new landline phone number because phone service system suppliers vary by location. However, with the internet, wherever you move or transfer, you may use the same cloud or VoIP service provider.

2. Upgrades

Another issue with old telephone networks is the cumbersome nature of updating.

Aside from the issue of needing to pay a premium for each update or add-on, updating your system is impossible without the assistance of a specialist. Even simply changing phone settings necessitates a technician site visit from your telephone provider.

Each caller must have a personal phone line, which means that specialists must manually go through each piece of your equipment. When you decide to upgrade your system, you must also manually update the product features.

This would not have been important when analog phone systems were the main form of telephone communication.  At that time, it was included in the deal. However, with the advent of more efficient UC systems, there is no need for most organizations to stick with a traditional solution.

3. Costs

One of the primary reasons traditional methods are losing favor is because they are no longer financially viable.

Monthly service rates for a standard phone system might be relatively cheap at times, however, the promise of lower monthly payments can be appealing (especially for small and mid-size enterprises). However, sometimes along the way, the total cost of ownership exceeds expectations.

An analog system might still be a viable short-term option for your company. Even so, it is not the same as installing a landline phone in your home: instead, you will need to invest in a multi-line phone system, which will allow your business to simultaneously handle numerous calls.

4. Features

Obviously, as with any hardware, there is always the possibility of a hardware failure due to physical damage. Some hardware components are so fragile that even if they are inadvertently dropped, they will fail.

Another logical reason your business may want an update is that your old traditional phone system lacks the functions you require to keep up with your company’s demands or the competition. 

In sum, a traditional phone system is made up of obsolete technology that is highly expensive to operate and does not provide contemporary capabilities such as mobility. 

These old phone systems are often not IP-based and rely on traditional phone lines (connected to the phone provider). Experts argue that legacy phone networks cannot be maintained indefinitely because networking technology is becoming obsolete and carriers are not investing in it to keep it viable.

Traditional Phone Systems: Alternatives

While there are some similarities between landlines and VoIP services, several differences lead many businesses to prefer the latter over the former. The most obvious examples are the prices of VoIP services and the flexibility they may offer.

Businesses have depended on the telephone for many years as a primary mode of communication. Phone systems are used to communicate with consumers, workers, and clients.

VoIP, on the other hand, has become the principal mode of communication for the majority of enterprises. It is even believed to be the speech communication of the future because of the tremendous benefits that come with this technology. 

VoIP is accountable for scalable and secure methods of communicating and surviving today’s corporate requirements. You will also get access to extra features such as voicemail, virtual meetings, call recording, and voice bots for handling client queries.

Furthermore, when using a cloud phone system, toll-free lines usually have lower per-minute rates than traditional telecom providers.

For small businesses wishing to expand, VoIPs are a better alternative. Investing in expensive equipment is not necessary. VOIP providers provide a variety of plans to suit the needs of various company sizes. 

With only one easy connection, you may have five IP lines instead of three. Another option allows you to assign a single IP address to many phone lines in your company.

For many organizations, the cost of VoIP vs. landline is the most important consideration when selecting between analog and VoIP phone systems.  VoIP calls are much less expensive than landline services, and many of the extra features are completely free to use. 

Installing gear and software is also less expensive for VoIP than it is for setting up traditional lines, so there is no costly upfront investment. In addition to being inexpensive to install, it is also simple to set up. It’s a straightforward upgrade that will create little interruption for time-pressed organizations in the midst of growing.

The Bottom Line

To summarize, VoIP systems provide more and more complex services for modernized enterprises than traditional phone lines. That is why, to fully appreciate its benefits, you must first grasp the fundamentals of a VoIP system, including how it operates, its features, and its distinctions from traditional phone systems.

Furthermore, having a thorough understanding of the VoIP system allows you to determine how it may best benefit your company.

For most other enterprises, VoIP is expected to eat up the majority of the phone industry’s market share for the foreseeable future.  Investing in VoIP technology can help you keep up with the fast-paced technological sector.

Also, with this solution, your phone system can expand with your company. You will not be required to make the initial infrastructure expenditure, allowing you to reallocate your budget to other essential company activities.

Both methods offer significant advantages, but you must choose which system is best for you, your budget, and your business needs. Failure to do so may cause your major corporate efforts to lag, hurting your bottom line. Nobody but your rivals want to see that, so don’t give them any enjoyment.