These days, it can be challenging for the average business owner to navigate the world of workplace communications. New technological innovations are appearing every day, and even telephony jargon has seemingly become complicated. When exploring business phone systems, chances are you’ve seen acronyms like POTS, PSTN, and VoIP. While it’s tempting to skim over this alphabet soup of letters, it’s better to learn what these terms mean and how they could affect your business.

You’re investing in a business telephone system, and it’s important to know exactly what you’re getting yourself into. Knowing the difference between these systems will help you make the best decisions for your business and set yourself up for success and growth. Before long, you’ll be an expert on POTS vs PSTN vs VoIP — from phone call quality to cost. So, let’s dive in and learn all about the differences between these three phone systems.

POTS vs PSTN vs VoIP: Defining the terms

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Let’s start with the basics and define the acronyms themselves.

What is POTS?

POTS stands for “plain old telephone service,” and is based on Alexander Graham Bell’s proprietary phone system The acronym descended from its predecessor, “post office telephone service,” due to the fact that all calls used to need routing through the post office. It’s one of the oldest phone technologies around.

POTS communication makes use of copper wires that were originally strung along telephone lines. Later, wires were laid underground. In order to place a call, POTS converts your voice data into electrical analog impulses. Your call then has to travel along copper wires to reach its intended recipient, and these wires are connected by central control rooms at the local, national, and international levels.

What is PSTN?

The public switched telephone network (PSTN) is a term used interchangeably with POTS. But more specifically, PSTN refers to the network of telephony itself (including switching equipment, cables, connection lines, etc.), while POTS is a voice service that works using PSTN infrastructure. They’re two peas in a pod, though technically PSTN can make use of technologies other than wires. For our purposes, we’ll keep things simple and use POTS and PSTN interchangeably.

What is VoIP?

Voice over Internet Protocol, or VoIP, revolutionized the telephony market when it was developed in 1995. Rather than using copper wire transmissions, VoIP phones transmit data packets over the internet between IP addresses — no wires or physical connections required. Even though VoIP is only a few decades old, it’s already changed the world of telecommunications for the better.

POTS vs PSTN vs VoIP: The major differences between them

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When you use POTS/PSTN to place a call, your call needs to pass through several switches to reach the intended recipient. As a result, there may be delays during long-distance calls or (at the very least) lapses in call quality. Copper wires are known for distorting sound, compromising your call quality and your business’s professionalism. Not to mention, the outdated nature of the technology doesn’t allow for the transmission of multimedia files, like images or videos.

POTS systems are so cost-ineffective and difficult to maintain they’re being phased out worldwide. That’s right — before long, traditional landlines will become certifiable antiques. The Federal Communications Commissions (FCC), which governs all things telecommunications in the United States, has issued an order declaring that all POTS lines in the U.S. must be replaced with an alternative, such as VoIP, by August 2022.

How VoIP helps your business thrive

Out with the old and in with the new. This phrase is especially relevant when it comes to technology and, in particular, the switch from POTS/PSTN to VoIP. In addition to being expensive and difficult to maintain, POTS/PSTN limits the scalability of your business, making it difficult to compete in today’s marketplace.

Who wants to pay for new hardware every time you hire an employee or open a new location? One of the biggest advantages of VoIP vs POTS is VoIP runs on the same hardware that powers internet data centers your business already uses for your website and other online infrastructure. That means to make calls over VoIP, you only need a mobile phone (or other device — voip headsets are optional) with internet access to get started. PSTN systems, on the other hand, require much more equipment and a much longer setup time.

Everything’s in one place with VoIP: the cloud. That means your phone system is in one central (virtual) location but still always accessible, no matter where you are on the planet. POTS systems tie you and your employees to a physical location. Business doesn’t just happen in a central office anymore. You need a phone system that’s as flexible as your work.

Plus, with VoIP, you’ll have access to advanced features that will amp up your productivity and customer service — something POTS/PSTN can’t provide.

Feature comparison: VoIP vs PSTN 

When you see the features of VoIP and PSTN compared side-by-side, it’s a no-brainer. VoIP systems win every time. Its unrivaled flexibility means that your business communications will run more smoothly than ever before, and your team can enjoy the benefits of remote work without the logistical nightmare of a desk phone. Take a look for yourself.

PSTNVoIP
Wireless capabilityX
Third-party integrationsX
Voicemail to text availableX
Call forwarding available
Caller ID available
Call waiting
Do Not Disturb availableX
SMS and MMS availableX
Shared phone numbers availableX
Auto-replies and snippets availableX
Interactive voice response  availableX

Costs of PSTN vs VoIP

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You can access basic business call features (like voicemail and caller ID) through a PSTN system, but you might have to pay extra for each feature. This means charges can soar over time as you incorporate new hardware and calling features to expand your business.

With VoIP, however, service is affordable and scalable, and basic call features are usually included in base subscription plans.

Some VoIP providers may charge setup fees or inflate their prices when billing companies with smaller teams. But with OpenPhone, plans start at only $10 per user per month, no matter how small or large your team is. We also don’t charge any setup fees, and each user gets a free phone number.

Call quality of POTS vs VoIP

When VoIP technology was first introduced, there was a lot of concern over call quality. Those concerns were fair at the time in the mid-1990s. Users with poor internet bandwidth, often using old dial-up internet service, experienced shaky connections and dropped calls. Today, high-speed, broadband internet service is so widely accessible that VoIP call quality is among the best in the world. VoIP calls achieve a crisp, clear sound quality without any of the noise interference of POTS line copper wires. 

If you’re worried about the strength of your internet connection, it’s worth performing a simple VoIP speed test to be certain your network can handle VoIP.

How to switch from POTS to VoIP

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Ready to close the chapter on POTS and make the leap into the 21st century? Making the switch from POTS to a VoIP provider like OpenPhone has never been simpler. Just perform the following steps:

  1. Plan for the switch: At this stage, you’ll run a VoIP speed test to ensure your broadband is up to the task. Then, you can prepare to cut ties with your existing phone service and begin to transition away from hardware that won’t be compatible with your new cloud-based business model, including desk phones, fax machines, and any other workplace devices. Make note of any existing phone numbers you’ll want to keep so that you can port them to your new service.
  2. Adapt your network infrastructure: When you choose VoIP, you can do away with all the hardware that made your old phone system run. However, you may want to replace your routers or upgrade your WiFi service in preparation for the transition. With virtual softphones from OpenPhone, you can access your entire VoIP system via the internet-enabled devices you already have, like your mobile phone, laptop, or desktop computer, making it crucial to have a reliable internet connection.
  3. Choose a VoIP provider and get set up: Explore different VoIP providers, focusing on things like international calling and texting rates, customer service, feature availability, and more. OpenPhone’s VoIP system is ideal for a growing business looking for a phone system that can scale alongside them. Then, set up your VoIP system and program your user preferences. Get your team trained up and ready to go, which shouldn’t take long since modern VoIP systems pretty much look and feel like the cellular phone apps you’re already used to.
  4. Get to calling: VoIP setup is a snap, and you should be ready to get to work in no time. You can begin making and receiving calls from your cell phone, desktop, or any other supported internet-enabled device.

Set up your business VoIP system today with OpenPhone

POTS vs PSTN vs VoIP: OpenPhone mobile and desktop apps

Now that you know the ins and outs of POTS vs PSTN vs VOIP, there’s only one thing to do: Ditch your clunky landline for a VoIP business phone system with sophisticated features. Once you’ve freed yourself from the outdated infrastructure of POTS/PSTN, your company will have the tools it needs to work efficiently anywhere, anytime.

Sign up for your free trial today with OpenPhone to see firsthand the flexibility a VoIP business phone system can offer.

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Author

By day, Celita is a Florida-based freelance writer specializing in technology, marketing, sustainability, and a plethora of other topics. Nothing makes her happier than reading and writing well-researched content. By night, Celita can be found developing her talents, which include her black belt in karate, her fluent Italian, and her knack for vegan cooking.

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