Talk can be cheap
Sunday Business Post, 06 December 2009
For financial controllers, it's back to the trenches. With up to one fifth of all Irish companies expected to face collapse next year, there has never been a greater urgency for cost cutting in business.
The good news is that your telecoms bill can be easily reduced, without compromising your firm's ability to do business. Here are ten specific ways in which it can be done.
1. Mobile phone ‘gateways'
Vodafone, O2, Meteor and 3 all offer free calls to numbers on the same network. Yet landline calls to mobile numbers are still very expensive. Wouldn't it be marvellous if there was some contraption that could make the network think that your landline call was a mobile call, therefore eliminating the charge?
There is, and it is the telephone operators' worst kept secret. It is called a GSM ’gateway'. It is a simple telecoms box - for as little as €300 - that switches outgoing landline calls into mobile calls. You can have one for calls to each mobile operator: your only ongoing cost is the mobile operator tariff (as little as €20 per month).
"In a company I worked in, we generated savings of about €800 a month," said Fintan Swanton, president of the Irish Computer Society and co-founder of Expense Reduction Ireland, a consultancy that looks at cost-cutting.
What happens when more than one person tries to ring a mobile number on the same mobile network? Simple: the gateway just pushes the second call back into the normal system, where the normal telephone rate will apply. However, if you are in a big company, you can get gateways with up to 32 SIM-card slots in them. This means that there can be 32 landline-to mobile calls under way at the same time, effectively free of charge.
One potential weakness of this system is number portability, where people switch their operator but retain their number." It is true that the box just looks at the number," said Swanton." But 90 per cent of the time, I find that you're getting the network you expect."
A basic single-SIM gateway costs from €300, whereas a 32-SIM model costs up to €28,000 (prices sourced from NetForce: www.netforce.ie). There could also be a charge for connecting it into the company's telephone exchange (PBX) and for annual maintenance.
2. Making proper use of IP telephony
Internet protocol (IP) telephone systems are the flavour of the month, and there is good reason for this. Of all the cost-cutting measures that are possible, IP offers the greatest potential savings.
Imagine if 90 per cent of all your company's telephone calls - local, mobile and international - were free. How much would your company save?
With a plan and a bit of investment, it's more than possible. It's done by setting up phones, computers, software and telephone exchanges to route all outgoing calls through a company's broadband connection.
To reach that level of efficiency, however, takes a sizeable capital investment. For a large company, that could be €100,000. For a small firm, it could be over €10,000. However, there are IP telephony solutions that work on a fraction of this budget.
One of the simplest things to do is to start using softphones on your computers and laptops. A softphone is a digital software program that connects to an internet or IP telephone system. There are many different softphones available, from free ones to sophisticated, multifunctional applications.
To get the most out of a softphone, you'll need an IP telephony contract. Companies such as Dublin-based Blueface set up IP telephone systems and softphones for small firms.
"I'm on Blueface at home," said Morgan Finucane of Net Communications, a Wexford-based IT consultancy." I can take my laptop anywhere and use my Blueface account. It's €150 per year for unlimited calls to Irish and British landlines. I used to run up bills of up to €400 every two months." While Blueface is often cited, any IT consultancy or service firm can perform this task.
"The focus of a business is both the cost of telephone lines and the per-minute charges," said John Brennan of Connect IT, a Dublin based technology firm.
"Reducing the number of lines is a huge saving. A lot of our clients would have four or five telephone lines, whereas when they move to IP over broadband, they move to one line. To have an individual number is very expensive with a PBX and an Eircom connection.
You're looking at a minimum of €3,000 for a fairly basic PBX." Set up correctly using ‘gateways', an IP system can produce huge savings in a very short time. "We re-organised the telephone system of a sports shop chain that had eight branches around the country," said Finucane.
"We took out the two phone lines that were installed in each premises, cut the line rental and issued a national 1890 telephone number. People calling a regional office dialed the 1890 number and were given the option to connect to a regional office. Those connections occur using the web, costing very little.
"That has saved the sports chain an absolute fortune as calls from shop to shop are now free. In addition to that, calls from shops to mobile phones are free, because we put in a couple of mobile GSM gateways. That company is saving more in one month than that phone system cost to put in."
How much does such a system cost?
"Assuming you have a network between two sites, you're talking a couple of thousand euro," said Karl McDermott of Damovo." But the savings are massive and your return on investment happens in a few months."
But it's not just the cash savings that make IP telephony worth considering.
"You should consider linking your digital phone system directly into your CRM[customer relationship management] or accounts software to instantly bring up callers' details on your desktop and save valuable staff time,’' said Alan Connor of Exchequer, a financial software firm.
This sounds complicated, but clever Irish small firms are using it for amazing productivity gains.
"Because we've set it up right, we can now link and access our office CRM applications on our iPhones," said Finucane.
"The system is amazing. Our customer signs for something on our iPhone and the CRM software captures it."
Finucane does this using Connect Wise, a US-based software product.
3. Axeing little-used phone lines
For companies of a certain age, there may be multiple phone, ISDN and fax lines that are not in use but are still being paid for.
"Redundant phone lines are amazingly common," said Swanton." I was recently working for one medium-sized business in the west of Ireland and found 16 assorted analogue and ISDN lines that they were paying rent for but hadn't used in over a year. That amounted to €3,200 a year just going down the drain."
In fairness to Irish IT and financial executives, redundant lines are not always obvious. Many disused lines are hidden in parts of the business that are not thoroughly re viewed, such as alarm monitoring services or emergency lines in lifts.
"Look at invoices for lines on which there is no activity," said Swanton." But always check carefully before disconnecting."
The hype around Skype has died down. But its basic usefulness is the same: free calls to other Skype users, anywhere in the world. And low cost (under two cents per minute) bills to landlines, anywhere in the world.
"Skype is great, especially for international calls," said Stephen McCormack, chief executive of Straywave, an Irish mobile multimedia company." I also use Skype on the iPhone a lot as it's really good."
Skype is particularly useful for companies that do not have consistent patterns of telecoms usage. Whereas one month might bring office-intensive work, the next could be spent on the road. Skype offers an easy, flexible way to take advantage of internet telephony.
"We got a contract to clean up a supplier's database," said Irene Collins, managing director of Excellence Ireland Quality Association (EIQA)."That meant phoning 600 suppliers to update information. We made every single call through a Skype account. It cost us pennies."
Within companies, Skype can solve issues that managers have with employees from other countries wanting to call home.
"We have two non-Irish staff," said Collins." We knew they needed to call home from time to time so we set up Skype accounts for them. We told them they could make personal calls after 5.30pm using the service."
5. Reining in roaming charges
No matter how clever we are at home, no matter how much new IP technology we adopt into our corporate systems, there is very little escape from roaming charges.
At up to 80 cents a minute - for calls received as well as made - roaming is a monstrous part of any company's telephone bill. However, there are some tricks and services available to lessen the financial pain. A simple device is to buy a SIM card for the country you're visiting.
That way, calls made and received to local numbers - a client's office or a contact's mobile number - won't cost the earth.
"I keep a US SIM-card for whenever I go the States," said McCormack." In terms of cost, you just have to keep it topped up, which is only about $10 (€7) every two months, and you can do that online."
Another trick is to try internet software on your smartphone, especially at WiFi hotspots. Skype works on several smartphones (including the iPhone). GoogleVoice is another application which, although constrained in Europe, is gaining traction in the US. Once set up, local calls from GoogleVoice are free.
Finally, there are some commercial services targeted specifically at roaming bills. Chief among these is MaxRoam (www.maxroam.ie), a SIM card that switches between domestic and international networks to get the best rate possible on roaming costs.
6.Texts and mobile data rates
Although mobile operators give out free texting deals, they are usually limited to specific operators and services. Outside of this, texts cost anywhere between five and 13 cent per text.
Given the huge growth in SMS as a regular business communication tool, this is a cost that could be trimmed. There are a couple of ways to do this:
(i) Instant messaging
The operators don't shout about it, but most of their services allow instant messaging clients. Instant messaging is free, once you're online. It also takes up little bandwidth, and so does not threaten data package limits." I link my Outlook to my instant messaging, so I don't have to check my mobile for mobile calls," said Karl McDermott of Damovo." You can do quite a lot with instant messaging that people don't really think of."
Despite the efficiency and low cost, instant messaging's main problem is in alerting a user when a new message has arrived. For this, the user needs to be constantly aware of the service.
(ii) Free web texts
Al l operators give a certain number of free text messages, outside any package or deal. The only condition is that you access and send the texts from a webconnected computer.
One enterprising Irish businessman has created a service - called Eirtext - that lets you log in to your webtext service from your iPhone or Android smartphone. Once downloaded, this application - which comes in a free or Pro version from Apps.ie - lets you use up your free texts from your handset.
7. New policies on premium numbers
The companies that advertise directory enquiries services bombard us with ads for their services. But take a look at your company phone bill. Whether it's 11811, 11850 or 11890, directory enquiries is a very expensive way of calling customers.
"Any smart business owner should introduce a policy of restriction on using 11850, 11890 or 11811 numbers," said Connor.
"And the real sting is when they are used to be connected."
Connecting directory enquiry calls costs up to an additional 60 cent a call.
"There's another useful reason for restricting directory enquiries calls," said Swanton.
"Sometimes, staff use directory enquiries to connect a call to a number they should not be calling, as they know it will innocently appear on the bill as directory enquiries, instead of the recruitment agency or personal number they are calling."
8.The right telephone plan
If IP telephony and internet gateways sound a little too advanced right now, you can at least ensure that the fixed line and mobile plans you're on are appropriate to your usage patterns.
"There's no one cheapest provider at any given time," said Swanton." There's a big difference between an exporter and a local trader in terms of usage patterns." Even the mobile operators concede that getting value means challenging your bill.
"Sometimes you need to switch provider," said Elaine Carey, sales and marketing director for 3 Ireland." Have a look at what your current provider is offering and compare the market."
Vodafone, for example, offers free roaming in Britain. But you have to ask for it, by registering for its Passport program.
"If you don't ask for a rate cut you're not going to get it," said Swanton.
9. Use free internet connections
Even if your mobile office workers are not set up with smartphones and mobile IP clients, it is still possible to make and receive free calls and texts on the road.
This is because Irish hotels and cafes are finally beginning to embrace wireless internet networks (WiFi) at prices that are almost reasonable.
While some hotels still charge €10 to use the WiFi service, others are offering it for €3 or even for free (such as Dublin's Skylon Hotel).The Starbucks chain of cafes provides free WiFi for anyone who signs up to its loyalty card scheme.
10. Use Fring
Most Irish business people have not heard of Fring. Over the next year, that will change.
Fring is a free software service that al lows people to chat and text over the web. But it's not just a standalone service: it works with internet calling applications you might already have, such as Skype, Google Talk, MSN Messenger and Yahoo Messenger.
© Thomas Crosbie Media 2011.