For the most part, cloud computing is known as allowing businesses to have access to expensive software programs at a fraction of the cost. However, a relatively new service is now entering the cloud. RingCentral is one of an increasing number of companies offering sophisticated suites of Internet-based voice and fax services that require no hardware or software systems, and yet offer features similar to those enjoyed by large companies. Services such as a virtual receptionist, dial-by-name directories, call forwarding, and voicemail is now stored on the Web.

But like the computer software space, this field is getting crowded. There are about 40 companies offering similar services. In fact, in April, eight cloud phone-service companies announced the creation of a nationwide high-definition enterprise Internet-based voice network. From a pricing perspective, the increasing number of cloud phone-service companies will result in very competitive pricing. 

This raises an important question for businesses, should the price drive the decision to use a particular cloud phone-service company or any cloud computing company for that matter. The old adage that you get what you pay for has never been more true in the cloud computing context. In the cloud, it is difficult to know exactly where your data is being stored or where the service originates. RingCentral, for example, has operations in California, its customer service is in Manila, and its engineering is in Russia and Ukraine. And this geographic diversification of operations is common for cloud computing companies.

Consumers of any cloud computing service must thoroughly investigate the cloud company’s operations. You should know where your data will be stored, the level of security in place to protect your data, and the responsiveness of the cloud computing company to fix any problems with the service. Any disruption with the service can have a significant impact on a consumer’s business. Sometimes, the lowest price company may not provide these services at the same level as a more expensive service. While price is an important element in any purchasing decision, when dealing with cloud computing services, price may take a back seat to other factors.