What factors affect VoIP costs?

What factors affect VoIP costs?

Voice over Internet Protocol (VoIP) currently serves as a terrific, cost-effective alternative to traditional telephone systems. VoIP refers to phone services hosted through the internet or a cloud. It can provide all the communications services and benefits that traditional phone systems offer at a fraction of the cost, making it an increasingly popular choice among businesses.

But while the scalability and non-reliance on physical assets of VoIP make it more cost-effective than traditional systems, a lot of variability can still exist in the cost of utilizing it. Broadly speaking, costs for VoIP are broken down into a monthly line rental fee and a usage cost. The former refers to a fixed rate that is paid for access to the service, while the latter is charged based on the volume of usage. Most providers will offer packages that subsidize fees for the latter up to a certain limit.

However, as with a lot of information technology-based solutions, the flexibility and bespoke nature of VoIP mean that numerous factors affect its price tag. It thus serves a business well to understand what factors play into final cost, determine exactly what value the business needs to get out of VoIP, and tailor its implementation accordingly in order to maximize savings. Here are some factors to keep in mind when considering VoIP costs:

Number of users

Instead of charging a rental fee for each user profile on a VoIP system, most providers charge based on the number of lines open at any given time. For example, a single line could be sufficient to service a team of three or four people, provided they never need to be on the phone at the same time. Likewise, a single line could be connected to several phones; for example, one at the office and one at home.

It’s therefore important for a business to assess how many lines are needed to meet the needs of its employees. Bulk discounts on the price of each individual line are also usually offered for clients paying for multiple lines, so make sure to keep an eye out for such deals.


VoIP services can include a breadth of features, many of which are optional. Among these are:

  • Number management – customizes the telephone numbers of users, including assigning multiple numbers to a single user
  • Conferencing – hosts calls with more than two parties
  • Voicemail to text – automatically converts the contents of voicemails into text
  • Call queuing – places incoming calls on hold while providing callers with estimated wait times
  • Call recording – captures phone conversations and converts them into a digital format
  • Web integration – integrates call-me function to a website that automatically generates an outbound call from the VoIP to the visitor’s number

The choice of which among the above and other features that a business makes will impact the cost of maintaining the VoIP service. To avoid overspending on features you don’t need, you must thoroughly assess your company’s communication requirements and processes.

Length of agreement

While VoIP fees are usually paid on a monthly basis, the option of locking into a contract exists as it does for traditional telephone systems. As in those cases, entering a contract for longer periods, such as 24 or 36 months, can net a lower per-month fee. Generally, longer contracts mean higher discounts.

Switching costs

Outside of the fees paid for the VoIP service itself, switching over from traditional phone systems to VoIP entails a number of upfront costs. Among these is the cost for the phone handsets. Internet phones function differently from traditional phones, and so a switch to VoIP means investing in the purchase of these equipment.

Alternatively, adaptors can be used to link traditional handsets to VoIP services. However, it’s important to note that dedicated internet handsets are usually more advanced, and may include functions or parts that facilitate the usage of some of the VoIP features described in the previous section. Another option is to forgo physical handsets entirely and rely on softphones, which are software applications that enable the use of telephone functions through a computer.

VoIP can give your business all the benefits of a traditional phone system at a fraction of the cost. Call Online Computers now for all the guidance you need to make this change.

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