When it comes to VoIP costs, you can expect to pay around $20 to $30 per user, per month for a hosted VoIP system that utilizes existing computer and mobile devices your business owns. In contrast, it can cost over $10,000 to fit an on-premise VoIP system for a small business, with all the additional hardware and equipment costs factored in.
If you look at our comparison table, you'll notice that most VoIP services start from around $20-$30 per user, per month, but this doesn't tell the full story, as we explain below. If you want to take a look at the best deals available for your exact needs right now, you can use our free custom VoIP pricing tool. It only takes 45 seconds. Or, read on for more information on typical VoIP costs and pricing factors.
VoIP Costs Explained: A Summary
To put it bluntly, VoIP costs can vary hugely, depending on the type of service you opt for. That’s because VoIP typically comes in two flavors: hosted, and on-premise (i.e. unhosted):
- Hosted VoIP: You pay the provider to host the VoIP service for you, and the provider handles the equipment and tech on its end.
- On-premise VoIP: Equipment is hosted locally at your businesses, and you are responsible for maintenance.
Hosted VoIP Costs | On-Premise VoIP Costs |
---|---|
Between $20 -$30 per user, per month | Between $500-$1000 per user |
Purchasing additional equipment is optional | Purchasing additional, specialized equipment is necessary |
Your VoIP provider will provide you with maintenance support | Your in-house IT team will have to troubleshoot technical issues |
In 2023, most businesses opt for the hosted option. It’s considerably cheaper as there is no initial large outlay, and it also saves a lot of headaches when it comes to potential tech issues (in essence, it’s not your problem). Larger companies may opt to host the equipment themselves, should they wish for more autonomy over the system, and direct access.
Whether you are looking for hosted or on-site VoIP solutions, our free comparison tool will find you the perfect provider – all you have to do is answer a few questions about your business and you'll be served a custom quote.
How Expensive Is Setting Up a VoIP System?
The VoIP costs you'll incur during setup will largely depend on whether you opt for the more modern, hosted, cloud-based system, or an on-premise system with additional hardware.
Hosted VoIP costs
As we’ve mentioned, if you go for the hosted option for your VoIP, there aren't really any setup costs to consider, outside of ensuring that your internet speed is up to scratch, and any compatible devices you wish to use.
Modern phone switchboards are not required to be physically placed in your office, and your provider can take care of all servers and connections, remotely. For hosted VoIP, you’re looking at a per-user, per-month fee. The cost of this will depend on the package you opt for, and the number of staff you want to sign up but you can expect to pay around $20 – $30 per user.
If you're using a hosted VoIP system, you'll probably want to pay for toll-free numbers. Toll-free numbers are business phone numbers that start with three digits, which your customers or clients can dial without incurring a fee on their end. Your VoIP provider is likely to give you some toll-free minutes within the plan you choose (most do in 2023), but it's good to check exactly what you're getting before you part ways with any cash.
Below are a collection of the top providers on the market, so you can see the full range of VoIP prices for yourself. All of these providers require no additional hardware to get you up and running.
Price from The typical lowest starting price. The lowest price available for your business will depend on your needs. | Free Trial | Users | ||
---|---|---|---|---|
BEST FOR VALUE | ||||
Zoom Phone | RingCentral | Vonage | GoTo Connect | Ooma |
None | 15 days | 14 days | Free demo only | 30 days |
Limit of 1000 (Enterprise Plan) | Unlimited (discounts for 50+ users) | Unlimited | Unlimited | Unlimited |
On-premise VoIP costs
If you’re looking to set up your own on-premises VoIP solution, then the costs are considerably higher, as you'll need to purchase specialized equipment to create your own on-premises system (known as a PBX). So, how much can you typically expect to pay for this?
It really does vary, but as a good indicator, RingCentral lists the typical cost:
- $6,495 for the PBX hardware
- $3,000 for the VoIP phones
- $1,000 for the setup and onboarding
- $4,000 for the software licenses.
This is for a 20-person team and doesn’t take into account additional IT staff or training. So, in this scenario, you’re looking at around $14,500 before you’ve even made your first call. It may sound daunting, but our quick comparison tool can get you a competitive quote.
As you can see, there’s a reason that so many businesses opt for the hosted option instead! Setting up a hosted system costs around a tenth of this, so you can see why it's so appealing to small and medium businesses.
VoIP and broadband costs
There's one other cost that we haven't mentioned so far because we think you've probably already got it covered by broadband. Unlike a traditional phone system, VoIP simply won't work without the internet.
For consistently good VoIP service, you should be looking at an internet speed of 10Mbps this is relatively undemanding, and you'll find that this is far exceeded by most business internet packages. However, if you're just starting out, it's something to consider. Broadband rates for businesses vary hugely depending on your needs but tend to start at around $35 per month, going into the hundreds for larger, more demanding businesses.
Whatever the size of your business, you can get started with VoIP today using our quick comparison tool.
How Much Is VoIP Phone Equipment?
So, you’ve decided that VoIP is for you, and you’re happy with the monthly service costs involved. Remember what we said earlier the monthly cost of the service doesn’t quite tell the whole story, and you’ll need to allocate a little more budget to get fully set up.
The main cost will be the phones themselves. You’ve got three options here you can either deck out your office with VoIP-compatible phones, adopt softphones (we’ll explain these later), or buy a converter that will allow your current standard landlines to accept a VoIP signal.
VoIP softphone apps
If you’ve never heard of a softphone, it’s effectively simple software for a device like a computer or a tablet, which can be used to make phone calls. It's effectively what companies like Zoom Phone provide you with.
Chances are that your employees already have computers on their desks, so a softphone could well prove the cheapest route to a full VoIP solution for your business.
A softphone is a software VoIP solution that lets employees make calls on their computers, without the need for dedicated telephone hardware.
Costs for softphones vary, but as an example, Nextiva charges $3 per user per month for the use of a softphone. In the short term, it’s much cheaper than buying a dedicated handset, but do consider what your long-term plans are and if you’d rather invest in VoIP phones.
VoIP adapter
A VoIP adapter can be purchased for around $60, and is the name for devices that can convert the signal for one phone to accept a VoIP signal.
While it may be tempting to keep your old hardware and just convert the signal, it’s worth remembering that while you can convert your old hardware to accept a VoIP signal, you may be missing out on some of the VoIP-specific features you’d find on a dedicated VoIP phone.
VoIP phones
If you’re looking to deck out your office with VoIP phones, then you can expect units to start from around $50 (the competitively priced Grandstream DP720), going into the mid-hundreds for models with all the bells and whistles. We’ve found in our research that a model like the Grandstream GXP12170, which retails for around $100, offers a great suite of features and won’t break the bank.
As well as standard VoIP phones, there are also models available that allow you to video call, too. Video conferencing has really taken off over the last year, with the pandemic forcing many interactions to take place over a video call.
Even when the panic subsides, the traditional working model seems set to allow for more home working than ever before, so investing in video conferencing equipment now could be the smart move. A model that allows video calls may sound expensive, but in actual fact, you can find video VoIP phones for less than $200.
Some VoIP providers will help you find the right phone or include them in their packages. Use our quick comparison tool for a VoIP quote for your business.
Price from The typical lowest starting price. The lowest price available for your business will depend on your needs. | Best For | Pros | Cons | |||||
---|---|---|---|---|---|---|---|---|
Poly VVX 601 | Cisco 7841 | Ooma DP1-T | Yealink W60P | Cisco 8845 | Gigaset C530IP | Grandstream GXP2170 | Grandstream GXV3240 | Grandstream DP720 |
$249 | $119 | $85 | $132 | $190 | $99.99 | $97.99 | $59 | $39.99 |
Best overall VoIP phone | Best value VoIP phone | Best for working from home | Best cordless phone | Best for video conferencing | Best for tiny businesses | Customizability | Best for multimedia | Best for a budget |
Very comfortable to use | Affordable | Unlimited nationwide calling | Up to 30 hrs of talk time | Headset included | Access to social media | 44 customizable digital keys | 1MP CMOS camera | Affordable |
AC adapter not included | Small, gray-scale display | Poor button haptics | Display isn't antiglare | Priced on the high end | No video conferencing | Only 480×272 pixel display | Runs on Android 4.2 | Small 1.8-inch display |
An Example of How Much You'll Pay for VoIP
As we've discussed, an entire VoIP system can be relatively inexpensive, at least on the surface. Let's take the time to look at the real-life cost of a VoIP plan for an office of say, twenty employees.
Zoom Phone, which is our choice for the best value when it comes to VoIP providers, starts at only $10 per user, per month, which means for twenty employees, you're looking at around $200 per month.
Let's use Ooma office as an example, as the cost per user is currently $19.95. For twenty users, this equates to $399 per month. It's worth noting that many providers operate on a sliding scale where the more employees the company has, the larger the discount. You can find out how much money you can save with Ooma by using our online tool, or check out the Ooma alternatives we've reviewed.
Next, let's assume that in this scenario, we also want to deck out our team with new VoIP phones. Here the costs can vary wildly, but let's take the Polycom VVX 150 phone, which is offered by RingCentral for $89 (or $3.99 per month). Twenty of these models come to $1,780.
Another, optional cost is a headset. While not essential, many call handlers will feel more comfortable and be more productive using a headset. Again, RingCentral recommends the Jabra Evolve 40, which retails for $80. Twenty of these come to $1,600.
In summary:
- 20 employees using Ooma: $399
- 20 VoIP Polycom VVX 150 phones: $1,780
- 20 Jabra Evolve 40 headsets: $1,600
In our example, we found that a typical, 20-person company can expect to pay an initial setup cost of $3,380, and an ongoing monthly cost of $399.
Remember that these costs are just a guide you could actually spend considerably less if you opted for softphones over physical ones, for example. For a bespoke quote for your business, use our online tool to find the best price for you.
International call costs
It's also worth taking into account the places that you're expecting to call. The reason for this is that different providers charge different pricing to call certain countries. For example, if you make a lot of business calls to Mexico, then you'll find that Ooma includes these in your service, while MagicJack charges $0.022 per minute.
Learn more with our MagicJack pricing guide
While some VoIP providers may look cheap on the surface, it's worth checking their international call rates to make sure you don't end up overpaying on a monthly basis. The good news is that VoIP calls abroad are a lot cheaper than traditional landline rates, but there are still large differences between the providers you choose. Below we've directly compared Ooma and MagicJack's call rates to give you an example:
Price from The typical lowest starting price. The lowest price available for your business will depend on your needs. | Best For | Free Trial | Contract length | Call rates | ||
---|---|---|---|---|---|---|
RECOMMENDED | ||||||
Ooma | MagicJack | |||||
Overall customer experience | Short term, low cost | |||||
30 days | None | |||||
1 month | 1 year | |||||
Free to the U.S., Mexico, Canada and Puerto Rico, charges apply for other countries. | Free to the U.S. and Canada, charges apply outside. |
The Benefits of a VoIP System
No matter how much VoIP costs, nobody would investing if there weren't good reasons to do so.
Whether you're interested in VoIP for international calls, or just looking for the cheapest all-inclusive VoIP system to streamline your processes, you'll be sure to reap a number of benefits.
Verdict: How Much Does VoIP Cost
As we've shown in this article, upgrading your business to a VoIP system can be cost-effective, and is certainly a much better option than a landline system.
However, remember that using a hosted VoIP system over an on-premise system will be considerably cheaper. As for your customers, they'll still be getting exactly the same great service, just at less expense to you. With a hosted VoIP system, not only do you not need any additional hardware, but you'll also have to do significantly less maintenance and troubleshooting, which will again save you money in the long run.
Now it's time for you to pick the provider that best suits your needs and budget. We've shown you some of the best in the business at the top of the page, but for a bespoke quote, simply use our free comparison tool we can save you time, money, and effort by linking you with the best fit VoIP provider for your business.
A hosted VoIP system will typically cost just $20 to $30 per user per month if you use free software to make calls instead of physical phones. If you need VoIP hardware, you can pick up a VoIP desk phone for around $80 and a VoIP headset for $40 from providers such as Yealink, Cisco, and Polycom, or indirectly via your VoIP provider, such as RingCentral or Ooma.
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