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A Real IP Phone System "On The Cheap"

I’ve worked with many corporate phone systems over the years. They all had several things in common: lots of features, and a very high price. More than once have I seen companies continue to use a phone system which was a bad fit for them, simply because they had invested so much time and money into the project. I knew that some day there would be a better solution.

I usually try to find free or cheap alternatives whenever possible. Phone call quality, however, is of utmost importance. Call quality tends to trump cost for me. I’ve used several Voice Over IP (VoIP) solutions in the past which sounded like “a bad cell phone” (as described by a former client). Having used expensive corporate VoIP/SIP solutions in the past, I knew that at some point there would be a solution for small businesses which was good and affordable. After installing and configuring a 3CX phone system, I think I finally have found it!

Installation was a piece of cake. I downloaded the latest version of the 3CX phone system from the company’s website. The software is free unless you want some of the extra features (such as call parking, call queues, and voicemail notification on a handset). Within 10 minutes I had a working phone system with working internal extensions. I easily ordered an external phone line on a pay-per-minute basis from CallCentric. I entered the CallCentric configuration info (provided as step-by-step instructions by CallCentric) into my new 3CX phone system, and 5 minutes later I had a basic 2 line phone system with the ability to make calls internally and externally. I used some old Linksys SPA-941 IP phones for a couple of extensions. These phones were left over from a failed attempt at a cheap VoIP phone system solution in the past.  These aren’t ideal handsets to use for a production environment, but they did the trick for my proof of concept.

In my opinion, infrastructure planning is the most important step in a project like this. The network requirements for a 3CX phone system are very low. I setup a dedicated 10/100 switch I had sitting in storage. According to an engineer at 3CX, I should be able to have at least 50 handsets on a 10/100 network with no problem whatsoever. I used a new subnet for the phone system, and all IP phone handsets. I used wall jacks connected to this 10/100 switch and kept it segregated from the rest of the network. In fact, that network switch connected directly to the firewall. I enabled QoS (Quality of Service) rules on the firewall, to help ensure that enough bandwidth was being reserved for all of the ports used by the 3CX VoIP phone system.

Instead of keeping a separate network for the phone system, I originally planned on creating a VLAN on a very expensive enterprise class managed gigabit network switch. Once I learned that the phone system needed so little bandwidth, I took the cheaper way and used an old 10/100 switch… why use up ports on those very expensive enterprise switches?? By the way, call quality did not suffer one bit by using this old equipment.

I am big into server virtualization and consolidation. So when I was looking for a place to install the 3CX phone system software, I quickly thought of running it on a virtual machine (VM) running on a Windows Server 2008 host running Microsoft’s Hyper-V virtualization technology. Since there were lots of other VMs running on this Hyper-V host, I did dedicate a physical NIC to this VM. I later heard a rumor that 3CX themselves actually runs some of their own phone system servers as virtual machines… but I was not able to verify whether this is true or not. I’ve also read lots of success stories about people using somewhat old PCs.

IP Phones, soft phones, 3cx assistant
For making calls you have a choice of using a physical IP phone or a soft phone on a computer. I tend to use a combination of the two, depending on what I’m doing. There are a variety of IP phones out there on the market. For this project I used some old Linksys SPA-941 phones, which was sitting in a closet for the past several years. There are some new phones from Aastra, Cisco, Grandstream (and many others) with some new features, enhanced call quality, and other new technologies. The purpose of this project, however, was to get a fully functional phone system up and running with as little cost as possible. The Linksys handset was simple enough to configure. It was completely automated. The newer models allow for a completely automatic configuration.

3CX also provides free softphone software which will run on Windows. I’ve tested this software on both 32-bit and 64-bit version of Windows 7, with no trouble at all. I am also running a copy of the soft phone on my Android phone (running Android 2.3 OS). I like using the soft phones with my wireless Logitech USB headset on my PC or laptop. It also works great, when I’m on the road. I found that the Android 3CX phone client works better over a Wi-Fi or 4G connection rather than my carrier’s 3G. If I know I’m going to be without any wireless internet access, I set my phone extension to forward all calls to my cell (which I can do while checking my voicemail). If you don’t like 3CX’s soft phone, many other vendors’ soft phones are compatible also.

Difference between free and paid version of the 3CX phone system
While the free option gave us all the functionality for our project’s proof of concept, we ultimately wanted more. So, we ended up purchasing a license. For a full list of features in the free and paid corporate versions visit: http://www.3cx.com/phone-system/3CXPhoneSystem_brochure.pdf.

Depending on whether you are using the free or paid versions, you will have a vast array of features. The IP phone system has features such as: automated digital attendant, DID numbers, conference calling, call parking, forwarding, call queues (including ability to “barge in”), and send voicemail messages as a .WAV file attachment in an email.

One of my favorite features is the availability modes. Each user has the ability to determine how calls are handled in each mode. When I’m “available” in the office, I want my desk phone, my PC’s soft phone, and my Android’s soft phone to all ring. When I’m “out of the office” I want to forward all calls to my cell. You can even create exceptions to these rules. As an example, maybe I want calls from a specific number to always get forwarded to my cell.

One gripe I have about the free version is that the little red voicemail notification light on your phone only lights up if you have a paid corporate license. The free version will still give you voicemail notifications by email though.

If you don’t end up purchasing a license, you have no access to email or phone support, though there is a great knowledgebase, blog, and tons and tons of configuration guides for DIY projects. I found several guides which gave me several methods for setting up my old Linksys phones. They really helped a lot!!

If you are planning on replacing or building a corporate phone system, I suggest purchasing your solution through a 3CX partner. These companies have the knowledge and experience to plan and deploy your phone system quickly and effectively. In the long run, you will still save a lot of money over a traditional phone system!

About the author

Robert Borges

About Robert...

I have been in the IT industry since 1993 focusing mainly in networking. Though I got an early start as an amateur computer enthusiast, and wrote my first database app at age 12, I started my professional career working in the MIS department of one of the largest liquor distributors in the northeast. I started out there as a systems operator on the company’s two mainframe systems. From there I moved into PC support, and help design and implement the company’s first client-server network… This was back in the days of Win NT 3.51. I also worked on my first migration to NT 4.0 back then.

From there I went on to work with Novell 3.x and 4.x along with Windows domains and active directory environments. Working my way up from technician, to specialist, to administrator, and eventually all the way up to Sr. Engineer. I spent many years working for consulting firms, 9 of which I owned and operated my own firm.
Over the years, I have worked with (at an expert level) various versions of: Windows client and server operating systems (including Windows 7 and Windows Server 2008 R2);various virtualization technologies (Hyper-V, Virtual Server, Virtual PC, VMware, etc…); MS-SQL server 6.5- 2008 R2; Exchange 4-2010, and much more.

I am now Director of Information Systems at Bay State Integrated Technology focusing on cloud computing and IT service, with expertise in: IT Infrastructure & Architecture, IT Security, and Cloud Computing platforms & technologies (SaaS, PaaS, and IaaS).

I am in a constant state of learning about new products, and new versions of products. Many of which we end up implementing in lab environments and sometimes for our clients. I have a pretty broad range of expertise and experience. It is my goal to share some of this experience on this blog to help enrich the IT community.

Permanent link to this article: http://www.robertborges.us/2011/03/voip-voice-over-ip/a-real-ip-phone-system-on-the-cheap/


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    Hiya! I just wish to give an enormous thumbs up for the nice information you_ve gotten here on this post.
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    1. Robert Borges

      Thank you for the positive feedback! I hope this info was helpful.

  2. FionaRees

    I had no idea of IP phone system and its installation process but you helped me knowing the entire process and now i feel like i can easily do it and i must try this. Thanks for enhancing my knowledge and making me so confident.

  3. Josh Monson

    I don’t understand how the incoming calls get to system, Is there like a dial up modem that your land line is connected to? Or is the call already digital and coming in over the internet. Sorry for such a noob question but I am wanting to do something like you did and I’m an absolute beginner.

    1. Robert Borges

      Josh, IP telephony is very different from our traditional way of telephone communications, so please don’t feel like a noob for not inherently knowing this. 🙂

      Incoming calls are generally coming in from one of two methods:
      1) Your IP phone system (3cx, Asterisk, etc.) is using a SIP trunking service. A SIP trunk is the equivalent of one or more phone lines sent over the internet to your phone system. So in essence, phone calls are converted to IP communication. Be careful when looking at SIP trunking services as packages for incoming and outgoing calls are often separate.

      2) Continue to use a traditional copper POTS (plain old telephone service) line. Many IP phone systems allow you to use a telephone adapter to use a standard telephone line with your IP phone system. In this scenario you are using IP telephony between your handset/soft phone and your phone system, but copper for the call. This is often a favored solution for fax lines (which are sometimes problematic over SIP) or as a backup line (in the case of an internet outage).

      In either case you usually have the option to port an existing phone number, which makes life much simpler. Did this answer your question?

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