Cost Comparison of Normal Calls vs. VoIP Calls

Virtually all businesses, both large and small, have at least considered upgrading their communication system to VoIP. Even private citizens have embraced this new technology because of its tremendous superiority over forerunners, especially because of all the new and enhanced features it has to offer.

But for both individuals and businesses, the single greatest reason for switching over to VoIP is probably its considerably lower cost. Regardless of all the benefits it provides, the one which appeals the most to budget-minded business people is the lower cost.

Most people are vaguely aware that VoIP technology is cheaper than using regular land line phone service, but they may not be sure why it’s cheaper, or how you can use that to advantage. Some businesses also feel that the capital investment which would be required to upgrade to VoIP, might outweigh the lower monthly bills you could expect.

It’s also true that not every business will realize a maximum savings on their phone bills when using VoIP. That makes it worthwhile to examine the costs of normal phone calls versus VoIP phone calls, so you can make a determination of what’s right for your business.

Why VoIP is Cheaper

There’s actually a very good reason why VoIP calls are cheaper than normal ones. Even though there is a strong similarity between the two (both involve sending your voice to another person, and listening for that person’s voice), the way those calls are made is very different. VoIP phone calls transmit your voice over the Internet as part of the information in a digital data packet.

Your network equipment doesn’t really care that voice packets are being transmitted rather than data packets. But it’s this network equipment which transmits your voice instead of the traditional copper wires that make an ordinary phone call possible.

VoIP phone calls are thus far less expensive, because they don’t require their own separate network or any kind of distinct infrastructure to transmit the sound of your voice. Instead they use networks and infrastructure which is already in place to handle data transmissions, which means that VoIP phone calls are virtually free of charge, although there is usually some cost associated with the technology.

Cost for Making a VoIP Phone Call

Now that you know why VoIP phone call can be made very cheaply, it’s worth comparing the actual cost between VoIP and traditional phone systems. Most people are aware that traditional phone systems charge you varying rates for domestic phone calls, as opposed to long-distance or international calls.

VoIP phone systems by contrast, don’t care where your call needs to be routed – it could be domestic or anywhere in the world, and it will cost the same. For most businesses, the vast majority of phone calls will be internal, which means calls are being made to other individuals in the same building, or to remote locations owned by the company.

Since none of these calls actually touch the Public Switched Telephone Network (PSTN), they are generally free of charge, regardless of how long the call lasts, or how many individuals are included on the call. No matter where the phone call participants happen to be in the world, there is no charge for a VoIP phone call, as long as it never touches the PSTN.

International VoIP Phone Calls

Either incoming or outgoing phone calls which leave your company network will generally incur a charge from your VoIP service provider, simply because at some point the call will travel over the PSTN. Fortunately, the call will generally only travel over the PSTN for a very short distance, which means that the cost of making an international VoIP call is far less than it would be from a traditional phone call.

Some VoIP providers offer options for unlimited calling to certain countries, either on a flat fee basis or as part of a pay-as-you-go plan. In some cases, you can also combine the two, depending on where the greatest volume of your traffic is directed. As an example, for a company which primarily calls individuals in England and France, you might want to establish unlimited calling with those two countries, and accept the normal rates for all other countries.

Miscellaneous Costs

In years past, traditional PBX office telephone systems were generally purchased by a business, and then all the hardware and software was set up by company employees, or by providers. It was also necessary to pay setup fees every time another line had to be added to accommodate a new employee. These costs and fees are a thing of the past with VoIP service, and none of them apply in a VoIP environment.

Instead, VoIP service is offered as a monthly subscription rate, which is made available as an all-inclusive package to businesses, or as a collection of à la carte services chosen by the business. In some cases, a VoIP business plan can be initiated for as little as $20 per month, although most are somewhat higher than that. Regardless of what your monthly VoIP plan costs, you can bet that it will be considerably cheaper than what your costs were in the old days of using a traditional phone system.

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