It may just be time for small and mid-sized businesses to get over their fears when it comes to Voice over Internet Protocol (VoIP).

Early concerns kept many businesses from dropping traditional landline telephone service and signing up for Internet telephony in droves. A survey in January of 350 businesses with fewer than 500 employees found that only half trust the security offered today by Internet telephony providers, according to the Computing Technology Industry Association, a technology industry association.

Small business concerns with VoIP involve quality of calls, reliability of service, and access to 911-emergency services from VoIP telephones. The issue concerning 911 calling exists because VoIP calls provide no geographic location information to emergency responders since they use an Internet connection, making the caller’s whereabouts hard to pinpoint in the event of a crime, fire, or other emergency.

But the marketplace has responded with a wide range of business-grade VoIP and hosted-IP telephony products. Today’s offerings promise better sound quality with more functionality, flexibility, and cost savings.

Why is it the right time for your business to consider VoIP? Here are a few reasons:

1. Mobility and flexibility

“VoIP has great mobility features,” notes Ward Ross, principal with Hinsdale, Ill-based telecommunications consultant Thompson, Ross and Associates.  Because VoIP phone service uses Internet lines, “You can take your phone anywhere in the world, have the same phone number, and be able to access your calls.” Small businesses with multiple offices “can appear as one office and have system transparency,” he notes.

In addition to this mobility, VoIP has the flexibility to integrate with other Internet-based services in ways a traditional telephone cannot. These include telephony during video/Web conferencing presentations, calendaring, or data file exchange.

2. Saves money

Beyond its superior flexibility, VoIP saves businesses money. Depending on the service you choose, you may be able to avoid paying for both broadband and telephone services -- or significantly scale back your telephone bills. Some providers allow you to buy broadband service and then calls over that broadband line are free. VoIP long-distance or international calls carry minimal charges, ranging from none to low. In addition, many VoIP providers, unlike the local phone company, offer three-way calling, call forwarding, auto redial, and caller ID without any additional charges.

Services run the gamut from free computer-based calling -- such as Skype -- to services that better simulate the telephone experience, such as Vonage, which offers small business service for as low as $39.99 per month.

While IP telephony systems can involve a major investment in hardware and IT staffing, there are also new hosted-IP telephony options available for small businesses. These include Aptela, costing $19.50 per user, MailStreet Voice at $39.95 per month, or the Asterisk business edition (using Asterisk open-source IP telephony), which is sold by Digium at $995.

3. Quality problems addressed

While open-source or lower-priced VoIP services still may fall prey to poor sound quality, such as “jitters,” echoes, or out-of-order voice transmission, an entire range of business-quality services has emerged. Providers such as Avaya and Cisco use Ethernet devices called IP-PBX systems to improve sound and data-transmission quality of VoIP service. These can also safeguard against the effects of power outages, which can knock out VoIP service but not necessarily traditional phone service.

4. Security issues are being tackled

Initial fears about the security of VoIP are waning, as more product lines offer ways to secure the lines. Companies like Avaya, Cisco, and Nortel all offer products with heightened security. John Gray of Nortel’s enterprise strategy marketing group, says that Nortel has taken a “layered approach” to security in its products, offering VoIP solutions that include firewalls, intrusion detection, and virtual LANs to protect multimedia VoIP uses. In addition to selling its solutions to VoIP carriers, Nortel offers its own line of small business options, notes Gray, including a new IP-PBX product with IBM.

But Ross believes the security issue just might be overrated. “Is your present telephone system encrypted? I don’t think so,” he says.  Eavesdropping and wire-tapping of traditional telephones is actually much easier than to do than with VoIP, he says. “I don’t think this is as big a deal as people make it out to be,” he says.

5. Emergency calling options

With regard to 911 services, Ross says that most VoIP providers have worked through the problem of failing to offer emergency responders location information about VoIP calls by registering the location of its users when they subscribe. The biggest problem remaining, he says, is the use of Softphones, a specific phone designed to carry VoIP calls that remains difficult to detect. “This is something they’ll need to deal with,” he says.

Nonetheless, most small and mid-size businesses need to consider these developments in the marketplace in quelling their fears of VoIP so that they can finally take the plunge.