How Much Does a VoIP Service Cost? Top 7 Considerations & What You’ll Really Pay
This article is part of a larger series on VoIP.
On average, monthly cloud-hosted voice-over-internet-protocol (VoIP) phone services range from $15 to $30 per user. Other expenses and factors add to your initial and ongoing investment, including internet service upgrades, metered international calls, the number of users, types of phone numbers, and advanced tools for collaboration. Use this guide to determine how much VoIP costs based on your specific requirements.
VoIP Costs at a Glance
VoIP Costs per User
Free to over $60
Monthly, included in service plans
VoIP Desk Phones, Headsets, or Adapters
Starting at $40 per unit
Additional Business Phone Numbers
$5 to $20
Monthly, included in service plans or available as an add-on
High-speed Internet Service
Starting at $49.99
Varies by provider and location, starting at approximately 2 cents per minute
Pay-as-you-go, add-on subscriptions, or included in service plans
1. VoIP Compatible Devices
Your initial VoIP phone system cost depends on the type and quantity of hardware needed. Top-rated small business VoIP services provide mobile and desktop apps, eliminating the need for additional equipment. Nextiva reported that “87% of people use a mobile phone to communicate at work at least once per week,” making this a convenient option for virtual teams.
Likewise, remote and on-premise workers use VoIP services on their existing desktop computers, tablets, or laptops. At a minimum, people working onsite or in a home office may want a headset to use with their computer, and the best VoIP headsets start at $69.99 each.
Your expenses will be higher if you have an office full of analog devices, such as desk phones, point-of-sale (POS) systems, and fax machines. In this situation, you will need to replace analog hardware or use an analog telephone adapter (ATA). A VoIP gateway connects your fax machine to digital lines, but you must double-check that your VoIP service costs include virtual faxing.
Here are prices ranges for various hardware:
- Analog telephone adapters: $69.99 to $276.99
- Headsets: $69.99 to $405.55 each
- VoIP desk phones: $50 to $319.99
- Conference phones: $199.49 to $679.99
When calculating your total VoIP costs, think about how many VoIP phones, headsets, and gateways or adapters you’ll need. This will give you a good idea of your initial investment.
2. Number of Users
Many business phone systems charge per-user fees billed monthly or annually, and the VoIP cost per user is part of your monthly service plan charge. Each user receives a voicemail box, a dedicated phone number, and access to an online portal for configuration. In most cases, the employee can forward calls to multiple devices and answer calls to other business lines.
Alternatively, virtual number providers like Grasshopper don’t charge per-user fees. Instead, you pay a flat rate for one to five lines. Your team will share the phone numbers and set up extensions. A flat-fee virtual service costs less per user for companies wanting unlimited domestic calling than full-fledged VoIP systems.
If you’re a solopreneur needing only one business phone number, a free Google Voice line may do the trick. However, you can’t add more lines or users to the free plan, whereas you can add users via an online portal with paid VoIP subscriptions.
3. Phone Numbers (Ported & New)
Many VoIP phone system costs include one or more business phone numbers. The price is built into your monthly per-user or flat fee. Depending on the provider, specific number types may cost extra, such as international, vanity, and toll-free numbers. Around 22% of small to mid-sized businesses have 800 numbers, and you can get a free one (and complimentary toll-free minutes) if you sign up for RingCentral or Nextiva.
You can also add phone numbers to your account without increasing the number of users. Phone number prices vary by provider and number type, and generally range from $5 to $10 per number, per month. In addition, some VoIP services charge a one-time fee for vanity numbers.
What if you want to keep your current phone number? Although most VoIP vendors will port your phone number for free, others charge $15 to $25. Plus, it’s vital to factor in the cost of keeping your existing phone service until the porting process finishes, which ranges from five to more than 30 business days. During this time, you’ll need to pay for the new VoIP service and your current service.
4. Stable Internet Connection
Cloud-hosted phone services offer a high uptime with a service level agreement. But don’t discount the importance of your internet connection when it comes to VoIP call quality. This is especially true if your business hosts one-to-one and group video meetings.
More than 50% of Dialpad survey respondents said “audio-related issues” are the “biggest pain point for video conferencing.” A slow internet connection results in poor audio and video quality and dropped calls. Each phone line generally requires 90 to 100 kilobits per second (kbps). You’ll also need to consider other usage and adjust your internet bandwidth accordingly.
Before purchasing a business phone system, check your current internet usage, bandwidth, and expenses. Talk to your internet service provider (ISP) to determine the pricing for higher-tier packages with more speed or dedicated internet lines with synchronous upload and download speeds.
In addition, you may need to check remote employees’ internet connection. Since Nextiva found that “more than one in three businesses have remote employees,” there’s a good chance that you have staff working from home. In this case, each team member should perform a VoIP speed test to ensure their speed is sufficient.
Determine your team’s internet speed requirements by reading our VoIP speed test article that comes with a free network quality test tool.
5. Long Distance Needs
VoIP pricing differs between metered and unlimited subscriptions. Telzio says, “the average employee uses 400 minutes” and suggests that companies can lower per-user VoIP costs “by bundling their users into a pay-as-you-go VoIP plan based on minutes per month.”
International call pricing varies by the provider and the location that you’re calling. Some vendors, like Phone.com and Grasshopper, require a deposit to enable international calling. Phone.com is among the cheapest phone services, with 500 minutes on its basic package for as low as $7.19 per user, per month. If you’re expanding and making more international calls, a service with unlimited international calling or add-on global calling plans is recommended.
Providers like RingCentral and Nextiva extend unlimited calling to Canada, whereas Ooma also includes free calls to Mexico and Puerto Rico. It’s important to read the fine print, however. Certain providers only offer unlimited calling within the continental U.S., excluding calls to Alaska and Hawaii. Consider 8×8 and GoTo Connect if you need unlimited international calling. Fees range from $24 to $44 per user, per month.
Although most VoIP providers charge per-minute fees for international calling, it’s typically cheaper than traditional landlines. Tech.co reported that “small businesses that switch to VoIP reduce the cost of their local costs by up to 40%, and save up to 90% on international calls.”
6. Monthly Provider Charge
There is a monthly charge for internet-based calling subscriptions, and VoIP service pricing ranges from $15 to more than $60 per user, per month. This will vary among providers and depends on the pricing model. Most cloud-hosted platforms use a tiered pricing model that charges a fee per user. Others charge a flat fee for a certain number of phone lines and extensions.
Take advantage of discounts for annual billing or sign a contract for 12, 24, or 36 months to reduce costs. Here’s how much VoIP cost per month for different business phone system providers with unlimited calling and monthly billing:
- RingCentral: $29.99 to $59.99 per user, per month
- Nextiva: $25.95 to $40.95 per user, per month
- 8×8: $15 to $57 per user, per month
- Grasshopper: $29 to $89 flat fee
- Ooma: $19.95 to $29.95 per user, per month
7. Required Features
Companies including Nextiva, RingCentral, and Ooma use a tiered pricing model, which provides additional features for higher-tier subscriptions. Services like Grasshopper offer the same features across all plans. Nearly all cloud-hosted phone systems have a mobile app, which is essential since 74% of workers report using a mobile application for making work calls.
There are some big differences among features regarding entry-tier packages. For instance, RingCentral Essentials and 8×8 Express don’t have internet fax, whereas Ooma Office Essentials and Nextiva Essential do. Nextiva’s entry package has one-to-one video conferencing, and Phone.com includes video meetings with up to 10 people on its basic metered plan.
8×8 Express stands out because it supports up to 100 video participants, but it’s only for small teams with 10 or fewer users. Neither Ooma nor RingCentral provides video features with base subscriptions.
If you want your business phone system to replace other tools used for collaboration or video conferencing, then it’s a good idea to look at these features. After all, more than 27% of Dialpad survey respondents said, “their video conferencing tool doesn’t meet all their needs.” The top missing components include integrations and real-time transcriptions. Workers also want to meet on any device without downloading a new application.
In addition, consider any advanced features required for your business or industry, such as call recording or call monitoring. These features are typically only available on more expensive plans. But some providers, like Dialpad, include call recording and monitoring on the base plan. Explore popular features, advantages, and drawbacks in our article that answers the question what is VoIP more in-depth.
How Does VoIP Pricing Compare to a Landline System?
VoIP costs are usually less expensive than onsite private branch exchange (PBX) systems. Telzio found that “setup costs for an on-premise phone system typically start at $20,000, while VoIP setup costs can be as low as $0.” Cloud-hosted tools don’t require a server, decreasing initial costs and maintenance expenses.
According to Microsoft, 82% of surveyed businesses saved money using cloud technology. On average, companies save 30% to 50% after switching to VoIP. However, there are situations where a business landline system is a better option, regardless of price. These scenarios include locations without reliable high-speed internet service and organizations providing emergency services.
When choosing a new phone system, compare pricing and features for VoIP vs landlines. Your local ISP may provide VoIP calling plans bundled with internet services, costing much less than a landline in your area. However, a landline may be cheaper if you only need a couple of phone lines and don’t want an auto-attendant or mobile capabilities.
Frequently Asked Questions (FAQs)
Does adding a phone line in a conference room or reception area cost extra?
Yes. If you need a dedicated line for a common area, most VoIP services charge for an additional user. You can also ask if the provider offers a less expensive option for common areas. For example, Phone.com has a $5 add-on fee for a shared phone line.
Can I make free calls with VoIP?
Unlimited calling plans let you make free calls over the internet, but most business subscriptions for more than one person cost money. If you’re a solopreneur, make calls for free with Google Voice or use a solution like Ooma, which requires a one-time fee to purchase an Ooma Telo and then provides free, unlimited VoIP calls.
How do I use VoIP on a computer?
Start making calls over the internet by logging into your VoIP account in a web browser. Alternatively, your VoIP provider may offer a desktop application or services integrated with your customer relationship management (CRM) application.
VoIP costs vary based on the provider, subscription plan, and the number of lines or users. Unlimited calling packages cost more than metered services, and advanced features may require a higher-tier subscription. Outside of monthly charges, you may also want to upgrade your internet service and purchase compatible VoIP devices.
Find the best option for your business by assessing your needs, comparing multiple providers and packages, and reading the fine print for any hidden costs.