The new digital era is already well underway, and businesses of all sizes are adopting new technology to survive and thrive ahead of their competition. The recent technological advances have had a dramatic impact on the way the world operates, revolutionizing some aspects of business processes that haven’t been changed in decades. This rings most true for the way businesses communicate, as the traditional public switched telephone network (PSTN) is used across the U.S., and the world now sees its days numbered thanks to the rapid growth of alternative technology.
PSTN is the world’s collection of interconnected voice-oriented public telephone networks. The system has been in general use since the late 1800s, and although most people associate PSTN with copper wiring, modern PSTN infrastructure also uses fiber optic cables.
A PSTN is made up of switches at centralized points on a network that function as nodes to enable communication between two points on the network. A call is placed after being routed through multiple switches. Voice signals can then travel over the connected phone lines. Simply put, a PSTN lets users make landline telephone calls to one another.
However, while all those miles of copper cables and telephone wires have given businesses the ability to chat to each other over landlines for generations, the rise of globalization and digitalization has signaled the coming end of the PSTN era. The analog technology necessary to leverage PSTN is far too expensive and difficult to maintain, and beyond that, it’s simply incompatible with the varied demands of modern communications.
And as technology continues to become more commonplace for business of every industry, a total switch-off of the traditional PSTN is expected by 2025 at the latest.
“While the switch off deadline still feels far away, for businesses, failing to prepare is preparing to fail,” said Indrajit “IG” Ghosh, CEO, ConnX, a cloud communications developer, integrator, and managed service provider serving large global enterprises. “Organizations are already increasingly looking for a device or application that is going to be able to replace PSTN, and our offering is modernization in the form of cloud-based services, the most notable being voice over internet protocol (VoIP) systems.”
With the rise of broadband, VoIP has become extremely popular, with roughly 3 billion users worldwide. PSTN replacement services are becoming more common as more companies begin the migration to VoIP. On top of this, in 2021, the global VoIP market was valued at USD 85.2 billion, but with the upcoming PSTN switch off, the market is expected to grow at a CAGR of 3.8 percent, reaching USD 102.5 billion by 2026.
“VoIP is now an extremely mature and proven technology, and coupled with the imminent PSTN switch-off, is enabling a mass migration towards cloud-based services – telco cloud services,” Ghosh explained. “For example, cloud-based VoIP services allow businesses to make calls from anywhere and include additional features to integrate key Software-as-a-Service (SaaS) business tools with the telephony system. With remote working in mind, VoIP is a key enabler of the work from anywhere model that is becoming dominant across industries.”
VoIP also helps benefit the bottom line, which saving money is vital for companies of any size. On average, a landline phone system costs businesses $50 per line each month. This rate comprises local and even sometimes domestic calls only. VoIP plans, in contrast, are available on the market today for less than $20 per line.
“VoIP can greatly improve a company’s speed, as cloud-based services also depend on the fastest speeds the internet can provide,” Ghosh said. “As we move into a world of 5G, which we know is 20 times faster than 4G, 5G will enable VoIP to offer organizations communication speeds faster than ever before – timing is perfect – but time is also running out.”
While PSTN has been the most popular form of communication for some time, digitalization catches up to all in today’s world. As more companies gravitate towards the trend of technology, ensuring the right technology is adopted that not only meets their current business needs but also needs that may arise in the future is the most important consideration for businesses surrounding the PSTN switch off.
“Cloud-based services, such as VoIP, will serve as the backbone for the migration away from PSTN,” Ghosh said, “and we’ve worked for years to develop our global voice network, working with network operators and industry associations. The great news following the great migration is the many benefits VoIP brings with it, as well as the modernization of global infrastructure to carry the calls over IP – this means greater access to the Internet for all, as we continue to do our best to narrow the digital divide.”
Originally published on Internet Telephony