Voip Savings

One of the main reasons people switch over to VoIP to meet their telecommunications needs is the much talked about cost savings. The other much touted benefits of VoIP are thought of as a bonus and it is only after they start using VoIP that people realize how good it is and how useful these “bonus” features are. But since cost savings it the prime motivator for switching to VoIP, it makes sense to have a look at the kind of savings that can be achieved.

Here is the breakdown of a typical medium use monthly residential phone bill:

Line rental charges $12
Average monthly call plan $10
Additional call time $8
Long distance call plan $10
Additional long distance calls $5
Caller ID $6
Call forwarding $3
Call waiting $3
Surcharges $6
Federal taxes $1
Long distance taxes & surcharges $1
Total monthly bill $65

The details may vary, but this is what a typical home phone bill looks like.

VoIP service providers will not break up the bill in this way – they do not need to because the surcharge and tax structure is different. And the distance from the point of call origin to its destination has no impact on the service providers’ costs; there is no extra charge for long distance. So most of them offer a flat monthly all inclusive plan with unlimited local and long distance calls. The cost may vary from provider to provider, but the average cost is just $20 a month. That is an average savings of $45, or 75% per month on your phone bills. And in a year that exceeds $500, which is definitely not small change.

Most VoIP service providers include the basic extras like caller ID, call waiting and call forwarding as part of their monthly packages. There is also no extra charge for conference calls and transmitting images, video and text along with the call. There are a number of value added services available that traditional phone companies cannot offer and these may be charged extra, but you don’t have to take them if you don’t want to. The best thing to do is start with a basic plan and then add on extra services as you feel the need. Even with the add ons, the monthly bill will be far lower than your landline one.

When you want to call landlines and cell phone using VoIP there will be a small interconnection charge for connecting to the landline or cell phone network. But this will still be only a fraction of the cost of a conventional call.

For businesses with heavy phone traffic, VoIP service providers offer special plans that can cut their communication costs by 70% and more, depending on the volume of calling they do.

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