Exposing the Top 5 Myths About VoIP Service Providers

It’s stunning to think about the changes we’ve experienced with communication methods in such a short time. What used to take months with a stamped letter now takes seconds with the click of a mouse or tap of a finger. Unfortunately, as with most things people come into contact with, there are bound to be some critics.

Despite VoIP having proven time and time again that it offers clear benefits in regards to business communications, VoIP service providers have garnered a bad reputation that has kept businesses from experiencing its vast benefits. Some would say this is due to fear of the unknown or a simple misunderstanding of the technology itself.

It’s time to turn this fear of the unknown into growth! That’s why we’re here to dispel the 5 common myths about VoIP.

  • Small Businesses Can’t Benefit

This is an unfortunate myth because its stopping so many small business owners from pursuing a resource that can ultimately save them time and money. We’re not talking a few pennies every month, either; some businesses see 30%-60% savings in annual cost! Although large enterprises have successfully managed to rely on VoIP service providers, small businesses would actually benefit the most! When you’re running with a tight budget and scarce resources, consider VoIP service providers who can offer valuable business communication tools such as auto attendant, call logging, customized caller menus, and more.

  • Unreliability

You wouldn’t run a business without internet connection, would you? Of course not. How would you receive emails, research competitors, and keep in touch with colleagues across the pond? Many VoIP deniers oppose the technology because it is seen as an unreliable resource when in reality, it’s just as reliable as your internet connection. In fact, if you already have an internet connection established in your business right now, then you’re just about ready to start using VoIP. As for dropped calls, call continuity is there to ensure you never miss an opportunity.

  • Call Quality Suffers

This may have been true in the earlier PBX days, but just as businesses themselves evolve and improve over time, VoIP has seen significant improvements since its inception. With a wider range of frequencies for voice data to travel through, congestion is less frequent and adding high-speed internet connection will only make the call quality better.

  • Higher Cost

Gone are the days when you needed to spend a fortune just to add another line of service or expand across locations. These days, VoIP service providers have made it easy to expand your team and business locations without compromising your budget. Most VoIP service providers offer different tiers for the type of services your business currently needs, which saves you money by providing you with the absolute necessary and none of the excess. VoIP is truly a more cost effective telephony method; maybe that’s why millions of businesses are already relying on VoIP service providers for their communication strategy.

  • Installation and Maintenance are a Headache

When you think about a business phone system, you may be picturing a server that needs to be stored in a closet and maintained by a highly-trained (and pricey) IT staff. Thankfully, clunky equipment is no longer needed when implementing a VoIP phone service. Most VoIP service providers offer remote provisioning with their hardware for fast and easy set up. If you decide to purchase phones along with service, all you have to do is connect the phones to the correct ports and watch your phone initialize. In under 10 minutes, you can be up and running with your new office phone; no cabling or heavy equipment needed. As for maintenance, most VoIP service providers have their own IT staff who are responsible for handling software updates.

Renewing Your Trust in VoIP Providers

It can be scary to take the first step towards something you previously thought was bad for business; but if you know someone who is currently using VoIP, ask them about their experiences. What did they like? How did it help their business? If possible, start on a trial period and see for yourself if VoIP is really living up to its hype. Once you’re familiar with the many ways VoIP providers can make a positive impact on your business, you’ll be wondering why didn’t make the switch sooner.

So what should you do when you decide that VoIP is right for your business?

Choosing Between Business VoIP Providers

We’ve established that business VoIP providers bring benefits to businesses of all sizes. If you’re a small business looking to save on costs and time, there is a practical communication technology waiting to be discovered.

Implementing VoIP Services Into a Business

Enhancing profitability and growing the business are key facets to any company’s success. Achieving both of those goals is typically influenced by a wide assortment of factors including telecommunications. Now that technology has given the world VoIP or Voice over Internet Protocol capability, it is important for forward-thinking businesses to implement VoIP services into their infrastructure as part of their continuing efforts to achieve success and push ahead of the competition. While it is true that land lines offer reliable communication systems, VoIP capability is faster and just as reliable. Plus, it also features a few additional benefits.

What is Voice over Internet Protocol?

Voice over Internet Protocol transmits calls via high speed Internet connections rather than using traditional methods. Fees are applied for both local and long distance services. However, the fees are generally the same for both local and long distance. This fact alone effectively reduces the cost of telecommunications for many businesses once they switch over. While additional fees typically apply for international calling, monetary savings of some type over traditional calling services generally come into play.

What About Voice over Internet Protocol and Existing Phone Numbers?

In most cases, businesses that make the transformation from land lines to VoIP can retain their existing phone numbers. Not only does this simplify the transaction, but it also assists in maintaining a positive flow in business activities. First and foremost, the company letterhead, stationery, business cards, etc will not have to undergo any changes. Therefore, no additional expense for those types of supplies will be incurred.

What Are the Features of Voice over Internet Protocol?

The quality of service with VoIP telecommunications is generally exceptional. Seamless calls with a high quality of service are the norm. The standard features of VoIP services are the same as those found with traditional land lines. Subscribers can have access to call forwarding, call waiting, voice mail, 3-way calling, and so much more. One of the perks of installing VoIP calling for your company is the one-click feature that allows your employees to click to call through the Internet. However, it is important to do your research since not all VoIP providers offer the same exact features with their stand plans.

What Is Needed to Utilize Voice over Internet Protocol Services?

Two basic choices exist when it comes to Voice over Internet Protocol set ups. Users have the option to purchase a special adapter that can be used with an existing phone. They can also opt to set up their VoIP service through the computer using a microphone and special software. The choice is a personal one that will vary from one company to the next. If the second option is chosen, the specific VoIP service provider that is selected to provide the service provides the software. One of the benefits of setting VoIP up to function through the computer is that this scenario frees up the caller’s hands, especially if the microphone is attached to a headset.

What Are the Primary Benefits of Implementing Voice over Internet Protocol Services?

Three main benefits exist when implementing Voice over Internet Protocol services into the workplace: a streamlined work environment, less expensive telecommunication costs, and a manageable contact list.

A streamlined work environment automatically occurs when VoIP is implemented into the workplace. VoIP connectivity often reduces the pile of items that typically sits on worker’s desks. In particular, land-line phones are replaced with slender hands-free microphones, freeing up desk space as well as the hands of the individuals placing the calls.

Less expensive telecommunication costs are one of the monetary benefits that result from a transfer from traditional calling to VoIP calling services. Since many VoIP providers offer less expensive rates for local, long distance, and international calling, the company can save quite a bit on their daily telecommunication costs. Think about how many different entities receive a phone call from your company on a regular basis- customers, potential customers, suppliers, service providers, and more. That is a lot of calling, so there is quite a potential for huge savings to result from switching over to VoIP. As the company’s cost goes down, their profits will go up.

A manageable contact list might appear to be a simple benefit at first glance, but it is not. How many wasted hours are involved over the course of a year when workers have to hunt for contact information? With VoIP, the contact list is simplified and constantly accessible. Not only that, but all of the pertinent information relating to any individual contact can be stored right along with the contact information on the computer, simplifying the work process for the employees.

As a result of the primary benefits of switching over to VoIP connectivity, productivity also increases, generating new growth and greater profits. Multi-tasking is much simpler when two hands are involved so your employees will be able to increase their output easier and with less physical stress. How many times have you seen your employees trying to juggle the phone between their neck and shoulder just so they could have both hands free for the keyboard or to hunt through important papers? With the hands-free head sets used with VoIP connectivity, your employees will be able to use both hands readily without straining their necks.

The portability of VoIP is another of the great aspects of this type of connectivity. VoIP can be taken and used anywhere that has high-speed Internet access. Necessary travel no longer precludes the ability to continue to make work calls on the company’s dime. Instead, work goes on as usual. In fact, the portability of VoIP eases the transition of a temporary office set up that simply must take place. No interruption to service or productivity results due to the transfer of the work location thanks to the abilities of Voice over Internet Protocol Services.

Voice over Internet Protocol Services is inexpensive to implement into a businesses telecommunication infrastructure. It leads to greater profits, enhanced productivity, and renewed growth. Is there any reason why you shouldn’t switch over to VoIP now? None whatsoever. Take advantage of VoIP technology today and propel your business ahead for the next wave of the future.

So You Want to Start a VOIP Business in Uganda?

I have recently been reviewing the business model for a company that is dealing in VOIP. For the uninitiated, VOIP stands for Voice Over Internet Protocol(VOIP). It is basically a technology/ies that allows telephone calls to be made over the internet rather than over traditional telephone lines.

I set out my simple and straight forward observations.

First the cons (of course)

1. Internet stability.

Internet in Uganda can be very unreliable and where it is reliable it is very expensive. Now this is very critical as to make calls over the internet you need VERY RELIABLE internet and so this is the starting point for anyone looking to invest in this sector. It is however not uncommon for an ISP to charge $1400 per month for 64 kbps. That’s not a lot of bandwidth as a typical telephone call requires about 8kbps at any time and so 64kbps supports only about 8 simultaneous conversations or less depending on internet conditions. The good news of course is that this is changing with fibre optic cables being laid all the time and so internet costs reduce. My best advice, use ADSL and shared bandwidth. UTL does a good job here, with a great value and generally reliable product if you can get the telephone line.

2. Competition

VOIP prides itself in being cheaper than the traditional telephone companies and many a VOIP provider will give you rates that are much cheaper than the networks. That was until recently. Many telecom providers in Uganda for example Orange have great international calling bundles that give the VOIP provider a run for their money. The VOIP provider is therefore having to compete with the telecom companies in offering customers international calling services. You have to therefore be prepared to look at your financials closely and constantly lest you fall into losses so do yourself a favour, get a good accountant!

3. The Exchange rate

The Uganda shilling is depreciating against the dollar and this may continue to be the case. In 2006 for example the rate was Shs 1,700 to the dollar. In 2011 at the time of writing, it is Shs 2800. For VOIP,this is critical as the main purchase is “digital airtime” from international VOIP providers. This is purchased in dollars and as such the prices charged to customers need to factor in the exchange rate, in addition to ensuring remaining competitive against the BIG BAD WOLVES (I mean the telecom companies).

4. Technology know how

VOIP is a specialised sector and so it of course requires someone with interest but this is not such a significant matter as employing an IT person will help reduce the entreprenuers need to worry about this.

5. Start up capital

From my rough estimates, a typical VOIP business (say a phone shop to support 6 phone booths) can ideally start up business from as little as UGX 8.7m. This should cover; rent at 500k per month (including 2 month deposit bringing it to 1.5m), internet installation and subscription; 700k, purchase of the VOIP and computer equipment; 1.975m, furniture/ fittings; 1m an inverter; 2m, legal and related costs; 700k and signage(to advertise); 500k.

From my analysis, a VOIP business on its own is however not profitable and therefore it is ESSENTIAL to also have an internet cafe running side by side. The costs of the internet cafe side plus the VOIP side stripping out the shared start up costs like rent and inverter will be 20,383,275. I have written about an internet cafe set up costs separately in the article on the internet cafe. The total start up cost is therefore about Shs 20m


1. Profitability and quick return on capital

Like the rest of Africa, In Uganda there are tremendous growth opportunities in the ICT/ communications sector and per Uganda Investment Authority, this is one of their key sectors for investment. Call traffic continually increases as Ugandans enjoy higher incomes. Despite the biting inflation, there is a continual increase in call traffic. VOIP is not being left behind and assuming ICT sector growths averaging 25% per year turnover averaging Shs 53m would not be an exaggeration. On the basis of my knowledge of this sector, I set out a summary profitability picture as well as the return on capital (this includes a diversified model which includes an internet cafe). All estimates are in UGX. The exchange rate to the USD is about 1 USD = Shs 2,700.

Gross profit

1.Revenue- calls: 65,520,000. Assuming 7 days a week at 180k per day.

2.Revenue- internet: 13,884,000. Assuming Shs 290k per week from 4 computers and multi purpose maching.

3.Cost of sales: -49,140,000. Assuming it is 75% of revenue for calls on basis of exchange rate and reseller margin.

4.credit transfer cost: -1,228,500. Assuming 2.5% of cost of sales

5.Franchise fee: – 655,200. 1% of revenue-calls.

Gross profit: 28,380,300


Rent: Shs 4,800,000

Internet: Shs 3,840,000

Staff costs:Shs 6,000,000

Other overheads: Shs. 1,800,000

Total overheads: 16,440,000

Net Profit: 11,940,300

Capital investment: 20,383,275

Return on Investment: 1.71 years.

2. Return on capital

On the basis of the above profit picture therefore, this business should be able to have a return on capital of 1.71 years. A word of caution here. The model above assumes full capacity growth and so may not necessarily reflect a start up business in say its first few months. In addition the model assumes the internet cafe and call shop will run side by side and concurrently. I have done a separate analysis of the VOIP model on its own and from my analysis it will take 90 years to get a return on your capital! In Uganda, there is therefore no alternative for a VOIP investor but to integrate the call shop and the VOIP services.

3. Diversified services

Despite the fierce competition, a VOIP business can survive by being diverse. Many VOIP providers do not only provide low cost international calls. They also provide other related services like cheap calls on your internet enabled phone, a foreign number(for example USA) even while in Uganda and use of VOIP in homes/offices. Some like http://www.telebm.com provide a special Uganda rate. In addition many integrate an internet cafe within their models as well as selling telephones and accessories. The diverisifed services spread the over head costs and enable continued profitability. In the profitability analysis above, I assume this business is diverse offering both VOIP and internet cafe services.

4. Franchise model.

The beauty about a VOIP business is that it is very scalable meaning you can keep on expanding to other towns, other urban centres, other countries. The typical VOIP provider will give you a software management system which can be accessed anywhere on the internet (after all since calls are made over the internet, call logs are likewise internet based). This gives a key advantage of remote monitoring for the business owner. You don’t have to necessarily worry about revenue as you can remotely monitor the sales(calls) on a real time basis because the call logs display calls(and costs) as they occur. The model can therefore be replicated by having you the business owner setting up agents who also get access to your system. I believe this is the model that http://www.mafudian.co.uk a Ugandan VOIP company is promoting.


First the numbers

On the basis of my analysis:

* Capital investment(internet and VOIP equipment) (A): Shs 20,383,275

* Revenue per year: Shs 79,404,000

* Profit per year (after all expenses (B) is Shs 11,940,300

* Return on capital(years to get capital back)(A/B) is 1.71 years

Now the basics you must get right before investing.

* Internet stability and reliability. Get a good ISP who supports VOIP

* Diversification of services. Don’t only do the VOIP services, consider an internet cafe, multipurpose machine, WIFI hot spots or even selling cell phones and related accessories.

* Location, Location, Location. This business best thrives in an urban setting with heavy traffic particularly of business users.

* Get an IT person, VOIP can be tricky to continuously configure.


This is not an easy sector to invest in with internet stability as well as the fierce competition with local telecom companies who now offer some good international calling bundles. Furthermore the exchange rates are continually changing due to the falling shilling hence potentially eating into the profit. I know many VOIP businesses that have failed and so to invest in it you need to have not only technology know how but like looking at the financial numbers as the margins can be very tight! A business which has taken off can however enjoy a significant amount of turnover and diversifying and expansion through franchising seem to hold the key to success.

How Does VoIP Phone Service Work?

For years, businesses have been replacing their analog phone lines with VoIP phone service. In its early years, VoIP picked up its own reputation among users and skeptics who touted it as unreliable; however, throughout its history, this new communication technology has grown in popularity and left its mark as a reliable and practical communication solution for businesses of all sizes.

Today, businesses use VoIP features to stay in touch with customers and colleagues, expand their businesses seamlessly, monitor employee performance, and build customer loyalty. By harnessing the power of the cloud, VoIP also offers a degree of flexibility and simplicity that analog users just can’t experience.

While analog phone service keeps communications fixed in one location, VoIP allows you to make and receive your business calls from any device (office, mobile, or soft phone app) or forward them to external sites and extensions.

The flexibility and convenience of this technology is what most users love about business VoIP providers.

Small businesses and entrepreneurs are also able to use VoIP phone service to create the image of a larger company with features like auto attendant and custom prompt menus.

What can you expect from a VoIP phone service?

VoIP takes analog audio signals and converts them into digital data which can be transmitted over the internet. With less bandwidth required to transmit the data, there is less occurrence of jitter which causes that choppy audio and lackluster call quality that drives everyone crazy.

Call quality, cost savings, and easy setup are the main drivers of VoIP’s success but there are several features and capabilities that set this communication technology apart.

These are few of the standard features you can expect when using a VoIP phone service:

  • Call forwarding
  • Voicemail to email
  • Auto attendant, also known as a digital receptionist or cloud receptionist
  • Call continuity
  • Programmable keypads
  • App integration
  • Caller ID display
  • Call blocking
  • Call conferencing
  • Mobile capabilities

VoIP phone service can seem like a drastic change to your communications strategy but if you’re willing to speak with consultants, you will see that it’s actually a simple transition.

A Better Business Communication Solution

Convenient set up

Even with more recent, premise-based business phone systems, set up is cumbersome and expensive compared to a cloud-based phone system. It requires users to connect wires and figure out which line pairs with which extension; most busy business owners usually end up either having to hire someone to install it for them or spend hours on the phone with their phone company.

With VoIP, the time it takes to get up and running is minimal and most VoIP service providers offer support to help you every step of the way. Usually, however, it’s as easy as plugging in your IP phone and letting it initialize to your existing network.

There are no wires or lines to worry about since your service provider takes care of most of the set up before you receive your new equipment. When you use VoIP phone service, your settings come pre-configured to your phone so all you have to do is connect your phone to the correct ports and you’re on your way.

The best part?

Since VoIP is cloud-based, your provider is able to take the maintenance of equipment and servers that help power your communications off your hands by managing their own servers and IT staff for your convenience.

This means any business can enjoy using this technology regardless of the size of their location.

Minimize costs

Businesses see significant savings when they switch from traditional phone service. With older PBX systems, you had to hire an IT staff to maintain the equipment housed in your office, pay for long distance charges, and if you wanted to add a line to your office you had to pay the phone company more for the phone number and installation.

Today’s VoIP technology only requires one-time hardware costs and a monthly subscription based on service plan rates. Long distance calling rates vary among providers but many offer unlimited calling along with competitive international rates.

Easy setup, lower costs, and robust features make VoIP a great solution for business communication. It’s no surprise that VoIP is seeing rapid growth with no signs of slowing down in the coming years.

Pros and Cons of VoIP For Small Business – Is it Right For You Or Not?

VoIP in a business environment can work very well. A lot depends upon your existing network though. If you have an overly secure network with a lot of traffic then expect the quality to fall. Try and keep your voice traffic on a different network to your data and remember that VoIP/SIP is not as secure as traditional telecoms.

First some of the benefits…. VoIP systems often cost less for recurring maintenance than traditional PBX equipment and are easier to configure when applying moves, adds, and changes. Incidentally, there is normally no configuration change required to move an extension in a VoIP network. Many VoIP systems also let you use the Internet for your outbound calling, which can reduce your long distance bill and displace the cost of a PRI or analog trunk circuits for access to the public telephone network. VoIP also enables Unified Messaging, which integrates email, voice mail, IM, and calendaring.

However there are some drawbacks….. IP phones are more expensive than traditional analog phones and have more stringent requirements for the network to support them than standard email and web surfing. While VoIP systems do generally have a more intuitive interface than traditional PBX equipment, in a company of 20 you’re not likely to see much turnover I would expect.

Additional drawbacks are:

– Voice quality (not all your calls will be as clear as a traditional analog line).

– Reliability. If your Internet or System Network goes down you are left without computers and a phone system.

– Basic Features are sometimes billed a la cart and can end up costing you more per user then a traditional phone system.

– Hosted VoIP solutions require you to buy the phones (and associated routers) and then bill you every month for the service. Where as a phone system (with all its equipment) can be financed over 3 – 5yrs and then you own the equipment and system features & service.

The best approach for determining the viability of such a move would be to have a cost analysis performed for each option and look at the total costs and system benefits, up front, at year five, and beyond.

For a small company, these are conditions that generally would indicate a possible business case for VoIP:

– Your company has multiple sites and pays for Wide Area Network circuits to connect those sites together as well as PRI circuits or Centrex lines for PSTN access.

– You have a number of “remote workers” who work out of remote/home offices, and the company pays for their home phone and long distance as well as their Internet access.

– Your company spends a significant portion of its technology budget on long distance or international calling.

– Your company has high turnover and/or personnel are constantly changing offices.

– Integration of unified messaging and/or advanced calling functions such as on-the-fly conference calls would allow your company to conduct business much more effectively, so much so that it would positively impact your bottom line.

– Your company is getting ready to move to a new facility and would have to pay to run cable.

Outside of those, I would say VoIP may not be your best choice. One option worth considering is a gateway that services traditional analog phones, but converts the call to VoIP when calling external numbers.

Don’t get me wrong I love working with VoIP, but if your current system isn’t broken or costing you an arm and a leg to maintain it, you may not need to upgrade.

What Every Company Needs To Know About Business VoIP And Unified Communications

A business voip solution is an alternative to a traditional switched-voice service. Instead of using dedicated trunks between PBXs, you can share the bandwidth with your data services, making better use of the available capacity. Also, in today’s business world the availability of a plethora of Unified Communications features within the VoIP ecosystem is a huge boon to business communications at all levels.

No matter which direction your business goes with a business VoIP solution… the key is understanding how you communicate and what you want to achieve.

The search for a business VoIP solution, or more appropriately Voice Over Internet Protocol, can confuse any business. There are many flavors of VoIP… and many pros and cons… that you need to be aware of when considering which service to choose. The goal of this article is to help you navigate through the technospeak so that you can make an informed decision that will save you time and money.


The first thing you need to know about business VoIP Service is that it can replace your local phone company. Whether you have just one POTS (plain old telephone service) line… or a voice T1 (24 bundled dedicated lines)… a business VoIP solution is meant to replace your phone company. Instead of using your local phone company’s voice connection, VoIP will digitize your voice signal and send it over an internet connection.

In order for your voice to transmit digitally through the internet, you need to be sure you have enough bandwidth to facilitate the communication link. To optimize the quality of your business connection we recommend a minimum of a T1 Line (preferably ethernet fiber depending on the size of your enterprise) – a dedicated link directly to the internet that is guaranteed to be up over 99.999% of the time. Since you will be entrusting all of your business voice communication to this technology, your connection to the internet becomes the critical link. You don’t want to risk a company-wide phone outage to save a few hundred dollars on your bandwidth connection. So always opt for at least a T1 Line (preferably ethernet fiber) over DSL. It just makes business sense.

If you need assistance finding and provisioning bandwidth… we have developed software that will allow you to generate a circuit price in just seconds. You can request a bandwidth quote (as well as quotes for Business VoIP solutions) by simply asking at Business-VoIP-Solution.Com. Of course the quotes are free and no obligation. NOTE:… all circuits acquired through this resource also include FREE independent circuit monitoring.

Once you have your high-speed internet connection taken care of, it’s time to select a Business VoIP Service provider – the company that will actually route your digitized voice signal to a real telephone on the other end. In essence, your VoIP carrier will become your long distance carrier. The service providers we work with offer unlimited telephone calls to the United States and Canada, all for one fixed price. For companies who average more than $40 in local and long distance usage per employee, VoIP is well worth the initial investment. In some cases there are also very cost effective options for international calling also {just ask if you’re interested}.

There are likewise other hidden benefits of Business VoIP service, the main benefit being the reduced bandwidth required to conduct a regular telephone conversation. Since a VoIP transmission only requires 32KB of bandwidth, you can fix up to 24 ‘VoIP lines’ on a Data T1, and still have 768KB left over for dedicated high-speed internet access! This means that you can migrate your entire phone system on to your existing T1 and still have half of the bandwidth allocated for data.

Another benefit of VoIP lies in the prioritization of the digitized voice signals that are generated when you speak. In the event no one is talking, the VoIP line does not transmit any data. This allows your T1 Line to dynamically allocate bandwidth as it is needed, instead of permanently blocking out an entire channel of data.

Business VOIP means intelligent communications. Whether it is toll-bypass call routing, unified communications (integrated phone, email, IM, etc), or a specific application on the phone itself, the power of IPT is in the applications. In fact, the robust capabilities and functionality of the unified communications applications available are a real selling point in adopting Business VoIP.

In a highly mobile sales organization “find me follow me” functionality may be priceless. In an organization where deadlines have to be met, point and click call control settings may be crucial. Other organizations may benefit with high level call log metrics to track billable time. Enabling true mobility across your work force, enhancing video/conferencing activity, and easy use when traveling globally are also very attractive attributes to businesses.

With so many features available on most platforms… rarely do you see every user applying the same controls and features. It’s the freedom to control communication at the single user level that makes VoIP a great business solution. Additionally, the marriage of Business VoIp technology and Unified Communications features opens up a world of unlimited possibilities and applications for today’s business communications.

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