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What is a softphone and how can it help your business?

Published on 25/07/2023 by Andrew Blair

Some SMEs in Australia are ditching their traditional desk phone system for a software-based one, but what is a softphone? Here’s why you might want to switch to softphones.

Employees using soft phone systems

Businesses have been using telephones for nearly 150 years. Despite the rise of email, instant messaging, social media, and automated chatbots, voice calling is still indispensable for millions of Australian small to midsize enterprises (SMEs) today.

But the technology behind phone calls is constantly evolving. Many companies have replaced their physical desk phone systems with softphones, which can offer more flexibility, and portability at a potentially lower cost.

This article discusses softphones, how they work, and how they differ from voice-over-IP (VoIP). We also explore the benefits of softphones for SMEs in Australia and ask what they should consider before investing in softphone software.

What is a softphone?

A softphone is a software tool that replicates the function of a telephone. The software can run on a desktop, laptop, tablet, or smartphone and allows you to call other phones— regular or soft. Unlike desk phones, softphone technology uses voice-over-IP (VoIP), meaning they send the audio over the internet, and require an internet connection to work compared to a regular phone call. 

Softphones can be used with the existing microphone and speakers that come with almost all modern digital devices. They also work with popular peripherals like bluetooth headsets, plug-in ‘call-centre’ style headsets, and earphones with in-line microphones that often come packaged with smartphones. It is also possible to get a handset that looks like a traditional phone to use with a softphone, if you prefer.

How does a softphone work?

Softphones work like regular phones, but often have extra features. The interface will be very familiar if you have ever made a call using a smartphone. Typically, the app will have a keypad to dial a number and buttons to begin and end a call.

Most also include features for saving contacts, speed dialling them, muting yourself or other callers, putting people on hold, transferring calls to other numbers, and holding conference calls with multiple people.

More advanced softphones integrate with other communications software like email, instant messaging, and videoconferencing, giving your business a range of communication options from one screen. These tools let you call someone (either using audio or video), send them messages or files during the call in a chat window, and share files so that anyone on the call can view and edit the same live document.

Is a softphone the same as VoIP?

While they don’t mean exactly the same thing, softphones and VoIP are closely related concepts. A softphone is an application that lets your device make calls. Voice over IP (VoIP) is a collective name for the technical protocols used to make voice calls over the internet. 

Softphones use VoIP to send audio between participants on a call, but SMEs usually don’t need to know the specifics of how the protocols work. Businesses deploying softphones often switch from a traditional phone system to VoIP, so the terms ‘softphone’ and ‘VoIP’ may often be heard together during this switchover period.

Why should SMEs use a softphone?

Softphones have several advantages for modern SMEs. They can help a business operate more flexibly, allowing employees more choice about where and when they work, without compromising on connectivity.

1. Portability

Employees can use a softphone on any device with an internet connection. This is especially useful for travelling, remote, or hybrid workers who may not be in the office. They can still make and receive calls from their work number, and use other business phone functionalities, like transferring calls and picking up voicemail, even when they’re not on site. SMEs can even use softphone software to run an entire virtual call centre.

Setting up a virtual call centre with softphones

If your business needs to handle incoming customer service calls or make lots of outbound sales calls, you may be thinking of setting up a call centre. Nowadays, this doesn’t have to be an office with rows of booths staffed by headset-clad agents. Many softphones include call centre features like call logging and monitoring, call transfers, ticketing, and call recording. People can work ‘at’ your call centre from home, which is a popular option with employees and can save your business money.

2. Any device, any phone number

Softphones allow employees to staff multiple phone lines using one device, or use the same number across devices. This can be useful if your business has a hotline or emergency contact number, for example. When an employee is on call, your business doesn’t need to give out the personal mobile number of whoever happens to be on duty that evening. Instead, you can ask them to use a softphone app on their device to which all incoming calls are routed.

3. Lower hardware costs

Most employees can use a softphone using the equipment they already have. Business laptops today are equipped with high-quality microphones and speakers, so they’re ideal for voice calls. Peripherals, if required, are not expensive either.

4. Go global without the costs

If you do a lot of business with overseas companies, you will know how much international calls can cost using traditional telephony services. Softphones are typically much cheaper as calls are covered under the cost of your existing internet connection and any fees you pay for the softphone service. But check whether the provider covers the regions you need when choosing a softphone service.

Four questions to ask if you’re thinking about getting a softphone:

1. What features do we need?

Choosing the right softphone starts with a full picture of your calling needs. Some SMEs will need call-centre features like ticketing and call logging. Others may require their softphone to integrate with customer service or customer relationship management (CRM) systems. Some will just use a softphone to make regular phone calls and won’t need to pay for these advanced features.

2. What scale will we operate at?

Some softphones are designed for enterprises with thousands of employees —and are priced accordingly. Others are aimed at companies that operate globally and include discounted calling to international numbers. Establish how many people will be using the softphone and how they will be using it before shortlisting providers.

3. Do we need to invest in new equipment?

Softphones can run on many devices, so your employees may already have an appropriate laptop or desktop. But you might consider investing in headsets, for example, so that they can make calls more privately in a shared workspace. If you plan to install softphones on employees’ smartphones, you should check that your chosen product works with all the operating systems (such as Android or iOS) that you have in your company.

4. How will we transition away from traditional phones?

Moving to softphones might require some training for people unfamiliar with the technology, but most have an interface that closely mimics a physical phone. You should consider the impact on customers, too. Carrying your existing phone numbers to a softphone system is possible, but not all providers offer this, so check before you buy.

The future of voice calling for SMEs?

Softphones are popular with SMEs for a reason. Installing them across your business can save money, give you smart new ways to manage voice calls, and allow employees a more flexible working model.

Looking for softphone software? Check out our catalogue!

This article may refer to products, programs or services that are not available in your country, or that may be restricted under the laws or regulations of your country. We suggest that you consult the software provider directly for information regarding product availability and compliance with local laws.

About the author

Andrew is a Content Analyst for GetApp, giving SMEs insights into tech, software and business trends. Interest in entrepreneurship, furthering projects and startups.

Andrew is a Content Analyst for GetApp, giving SMEs insights into tech, software and business trends. Interest in entrepreneurship, furthering projects and startups.