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VoIP vs. UCaaS: What’s the Difference?

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With the rise of remote working, more and more organizations are trading legacy communication channels for internet-based tools that keep employees connected, no matter where they are. 

VoIP and unified communications (UCaaS) are two of the technologies that have changed the way workforces communicate—but what exactly do they do, and how are they different?

In our UCaaS vs VoIP comparison, we’ll explore the similarities and differences, and find out how the tech helps your business get ready for the future.

What is the difference between UCaaS and VoIP?

Although people sometimes use the terms interchangeably, UCaaS and VoIP are two distinct types of technology that can be used together.

The key difference between VoIP and UCaaS is that VoIP provides voice calls and advanced calling features, while UCaaS combines multiple communication channels (including VoIP-based ones) in a single platform. There are several similarities, though.

Both solutions are internet-based, and typically paid for via monthly or annual subscription. Both are user-friendly, easy to set up, and designed to reduce operating costs and improve productivity. And both facilitate remote work by enabling teams to communicate from anywhere.

What is Voice over IP (VoIP)?

Voice over Internet Protocol (VoIP) was first introduced in 1996 as a way to reduce the cost of long-distance phone calls. It connects your phone service over IP networks instead of a landline, which is more cost-effective than having both internet service and a phone line separately. 

VoIP works by turning analog voice signals into digital “packets” for transfer, and reassembling them again at the other end so that the recipient can hear your voice. Transferring information over IP is faster and enables better quality calls. 

And, since VoIP uses the internet for calling, you can make calls directly from a phone, computer, or app. This is more flexible and scalable for large organizations that need a streamlined solution for conference calls anywhere, anytime.

VoIP features include:

  • Simultaneous ring: Calls show up on your desk phone and mobile device in case you’re out of the office
  • Call forwarding: Sends calls from the destination phone to any mobile phone in the system and quickly passes callers to the right contact
  • IVR menus and call routing: Directs inbound calls to the most suitable agent or department and reduces wait times for callers
  • Call logs and call recording: Helps you keep track of customer interactions
  • Call analytics: Helps you to understand how your phone lines are being used

All of these features make VoIP a necessity for organizations that need clear phone communication channels. But how does it stack up in the battle of VoIP vs UCaaS?

What is Unified Communications as a Service (UCaaS)?

Since the early days of VoIP, communications technology has further evolved with the introduction of Unified Communications as a Service (UCaaS). UCaaS integrates VoIP and a host of other communications features such as team messaging and video conferencing into one platform. 

Besides an advanced phone system built on VoIP, you get a completely unified digital workflow that lives in the cloud and is accessible to users on any device. Anyone can effortlessly switch between communication channels—mostly with just a single click. 

The platform also acts as a hub for all workplace collaborations. Users can access all of their messages, calls, and files on any connected device, launch and join meetings, form groups, and even indicate presence status (available, do not disturb, offline).

As you can imagine, there are plenty of UCaaS use cases. For example, a marketing team in the middle of a complicated messaging discussion can quickly switch to a video call without leaving the platform. Just a single click and they’re ready to start a face-to-face interaction. 

Because UCaaS lives in the cloud, it also supports third-party app integrations with tools such as Google Workspace, Salesforce, and Microsoft 365. Workers can personalize their tools to accommodate their specific tasks. 

For example, marketing personnel who work in the Salesforce app can integrate it with RingCentral, allowing them to make video calls—and do a lot more, too—from within Salesforce.

Why is UCaaS relevant today?

UCaaS facilitates deeper communication and collaboration—with less technology. In today’s increasingly-remote work culture, this is especially important to driving business success.

Globally, the number of people working from home all or most of the time was 10% in 2019, but had risen to 28% by 2023. The COVID-19 pandemic was a huge driver of this change, but the trend continued as businesses and employees realized the possibilities of the remote and hybrid model. Now, 98% of workers want to work remotely at least some of the time.

But because the pandemic threw organizations into remote work faster than anyone could have  expected, most weren’t prepared. They adopted digital solutions on an ad hoc basis, which meant  separate apps for team messaging, video conferencing, and VoIP. 

All of which your employees waste time switching between.  See: Your Employees Are Being Overwhelmed by Technology. Here’s Why It Matters.

UCaaS helps solve this problem by combining your communications  apps into a single platform. When employees need to send a message, join a meeting, or call a colleague, they can simply use the same app. No need to run multiple tools just to accomplish one task.

UCaaS in action: Streamlining communication

 By centralizing features like voice calls, video conferencing, instant messaging, and file sharing into a single, user-friendly interface, UCaaS reduces app fatigue and streamlines workflows. This fosters better collaboration and keeps teams on the same page, regardless of location.

UCaaS providers like RingCentral offer robust solutions with a wide range of features, making them ideal for businesses of all sizes.

Alongside the UCaaS features we already mentioned, you’ll get SMS messaging, e-faxing, and workforce management—and you can even engage with customers on social media.

UCaaS vs VoIP: Which one is right for your organization?

VoIP is a must-have for every modern organization. But is it enough? For organizations that conduct most business over the phone, possibly. Companies that run on leaner operations may not need the bells and whistles of a full UCaaS solution—at least, not yet. 

But as your business grows, UCaaS enables the deeper levels of communication and collaboration necessary to drive success. The future of work is remote, and dispersed teams must have the right tools to facilitate teamwork. 

What about the price of VoIP compared to UCaaS? Well, it’s true that UCaaS might cost you a little more, but you’ll be getting a lot for your money—and cutting costs through efficiency. Just make sure you do the research on UCaaS pricing and find a provider with fair and transparent billing.

The final word on UCaaS vs VoIP: a digital phone system will transform your business. But if you streamline all your communications with a UCaaS solution, you can ensure that employees have everything they need to work together, now and in the future.

View a demo of RingCentral’s UCaaS solution today to learn more.

Originally published Jun 15, 2024, updated Jul 03, 2024

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