There are several factors that go into figuring out the cost of a VoIP system, so we’re going to break it down for you.

The cost of a physical phone is the first factor to consider, as costs can range between $100 to $1,000 depending on the phone type. Don’t need a phone? Softphone software can place calls directly through your internet connection, eliminating the need for a physical phone entirely.

Next, you’ll need to sign up for a standard hosting system. If you elect for on-premise hosting, costs can range from $500 to $1,500 per agent per month. Upfront hardware installation can average to about $500.

You can also opt for a cloud-based call center software that can operate remotely. This is often a more affordable option, with services ranging between $20 to $300 per month per agent.

So in short, you can customize the cost of your VoIP system to your budget pretty easily, which makes it accessible for businesses of all sizes.

Of course, there are plenty of other factors to consider when pricing out your VoIP system, from additional accessories to the best call center software features. So let’s take a look at how much each of these factors could potentially cost.

The Most Common VoIP Pricing Structures

Here are some common pricing structures you’ll come across, with tips on when it makes the most sense to go with each option.

Unlimited plans with monthly fees

This pricing structure offers a monthly fixed rate for unlimited minutes every month. This is best for businesses with high call volumes like outbound sales teams or large customer service departments.

The benefit of this plan is that you know exactly how much you’ll be paying each month, making it easier to budget. However, if you’re not going to utilize the unlimited minutes, it may not be the best value.

Pay-as-you-go pricing

Pay-as-you-go pricing is also known as metered pricing and adjusts to your actual usage. You only pay for the minutes and additional features that you use each month. It’s ideal for businesses with unpredictable call volumes such as seasonal businesses or startups.

The risk here is if you’re expecting an influx of volume in the near future or have a lot of long calls, this can quickly rack up costs.

Tiered pricing

Tiered pricing plans offer a variety of fixed-price subscriptions at different levels of service. For example, you may have a basic plan providing a limited amount of data for VoIP calls or a premium plan with unlimited calls and additional features.

These plans are more flexible for businesses that want to work with a VoIP service provider for the long term but may need to expand into higher service levels as their business grows.

It also makes it easier to downgrade to a lower service level if needed, without losing access to critical call features.

Freemium model

The term “freemium” refers to a free version of a product or service that also offers paid options for more features. It’s a great way to dip your toes into the VoIP pool to see if it’s the right fit for your business.

Just remember, if you go with a free option, it won’t have complete functionality, which could impact the quality of your calls. If you want to fully test the power of VoIP calls for free, consider signing up for a trial of a paid plan to really get a feel for the service.

Bundled pricing

Purchasing VoIP services in a bundle may be the best value if you’re seeking a fuller suite of features. For example, you could pay a flat rate for unlimited calls, call recording, a PBX system, or voicemail transcription.

This is the best solution for businesses that want to standardize their communication tools and simplify billing.

VoIP Equipment Costs

Here are some additional costs to consider when setting up your VoIP system equipment:


As mentioned earlier, physical phones can range from $100 to $1,000 depending on the type. There are many options, but here are a few kinds to consider:

  • Traditional phones ($10 – $200)—These phones look like landline phones but are designed to connect to VoIP technology. They range from basic to top-of-the-line with detailed displays and programmable buttons.
  • Conference phones ($100-$500)—If you’re looking for a VoIP phone that supports large group calls, these are your best bet. While they’re a bit more expensive on average, the best conference phones offer crystal-clear audio technology with 360-degree microphones and high-volume speakers.
  • Receptionist phones ($50 – $400)—This phone is best for companies that need multiple lines and receive a high amount of inbound calls.
  • USB phones ($20 – $100)—These phones offer the convenience of plugging in directly to a computer without any additional setup.
  • Video phones ($200 – $1,000)—If you need the ability to see your callers, these phones offer a video display for face-to-face calls. They tend to be on the more expensive side and can easily cost thousands of dollars.


Investing in the right headset can make the difference between a good and a great VoIP experience. The best VoIP headsets can range between $19 to $250 for a quality option.


An analog telephone adapter, also known as an ATA, turns the signal of a VoIP into an analog frequency. This lets you use analog devices like fax machines and phones with your VoIP service.

These adapters generally range from $50 to $250, making them an affordable alternative to purchasing new equipment.

On-premise costs

The on-premise costs for VoIP systems include purchasing equipment, installation fees, and maintenance. These can add up quickly, with a wide range of costs depending on the complexity and size of your system. Think between $500 and $3,000 for an on-premise VoIP system.

For significant cost savings, opt to use only softphones, or choose a virtual phone system that integrates with your current mobile devices.

Softphones allow you to make calls directly from your computer or mobile device, eliminating the need for physical phones. On the other hand, a virtual phone system leverages your existing devices, eliminating the need to purchase dedicated equipment for VoIP.

In both cases, the cost savings can be substantial, especially for startups and small businesses.

VoIP Setup and Installation Costs

There’s a lot of variation when it comes to the pricing of a VoIP setup since there are so many different equipment and service options available. Here’s a breakdown of a few of the expenses you may encounter:

  • Labor and installation per device (if you don’t install the system yourself) averages between $25 to $100
  • Technical configuration costs may range between $30 to $200
  • Internet upgrades, if needed, average $30 to $75 per month
  • Number porting (transferring your current phone number) averages between $20 to $40 per line
  • Router and switch upgrades can range from $200 to $500
  • Hiring an IT team to help with setup and troubleshooting can range from $50 to $150 per hour
  • Training costs to onboard your team to the system can average $100 to $500 per person
  • Virtual phone number companies generally charge between $10 to $30 per line per month for setup and ongoing support

Do your research when searching for the best VoIP phone services and products. Make sure to get multiple quotes before making a final decision.

Monthly or Annual VoIP Service Fees

Hosted VoIP services start around $10 per user per month, while VoIP desk phones can start higher. Cloud-hosted VoIP ranges from $15 to $60 per user monthly. For enterprise-level solutions, the common price starts at about $30 per user.

You should also factor in the following costs, which may increase the subscription rate of your VoIP service:

  • Call recording capabilities and audio storage—$5 to $30 per month
  • Adding additional phone numbers—$1 to $20 per number
  • Using toll-free minutes—$0.02 to $0.05 cents per minute

If you’re adding a new network specifically for VoIP, you’ll have additional fees such as:

  • Network equipment installation and setup—$500 to $7,000
  • Additional routers or switches for large systems—$1,000 to $4,000

Some subscriptions may include these network fees in their packages, so always ask about this when shopping around.

Hidden Costs Most VoIP Providers Don’t Advertise

Hidden costs aren’t often advertised on a provider’s site, but they’re important to know to make sure you stick to your budget. Some of these expenses include:

  • Taxes—VoIP providers are required to pay local, state, and federal taxes, which they may pass on to you. These vary depending on your location and service plan. You can expect a percentage between 5% and 10% of your monthly subscription cost.
  • Recovery fees—If you need your VoIP provider to recover important data for you, they may charge a fee to do so.
  • E911—This stands for enhanced 911, and the service allows emergency operators to view the location of the caller in the case of an emergency. This could range from $1 to $2 per line if it isn’t included in your plan.
  • Advanced support fees—While many services offer full support, you may need to pay an additional fee for round-the-clock support, or specialized support for training a team. This could cost anywhere from $50 to $150 an hour.
  • Early Termination Fees—In many cases, providers require users to sign a contract that lasts one to two years. There may be a cancellation fee if you try to end your contract early.

As you can see, these fees vary from service to service, and you’ll want to review your terms and conditions thoroughly to check for these hidden costs.

Example VoIP Costs for a Small Business with 15 Employees

Let’s say you have a small business with a team of 15 employees you want to set up a VoIP service for.

Here’s one example of how this would break down:

Set up your in-house VoIP System: $2000

This step only applies if you’re going to run your VoIP from your physical location. With on-premise costs ranging from $500 and $3,000, you may pay $2,000 for installation, equipment, and any customizations needed to get your communication system running.

Equipment costs for 15 employees: $1,125

Let’s say that you want to buy an affordable IP phone for each member of your team. If you spend $75 per phone, this would amount to $1,125.

Determine the ongoing monthly costs: $750 per month

Next, you’d select a cloud-hosted VoIP service that can provide all the services your team needs. If you go with a fixed-price unlimited plan, you may be looking at $50 per line. For 15 people, this totals to $750.

The Bottom Line: How Much Does a VoIP Really Cost?

When it comes to VoIP vs landline features, it’s clear that VoIP wins in terms of features and costs. However, the key to getting the best value is to assess your company’s specific needs, clarify your budget goals, and find high-quality service providers at a good price.

So don’t skimp on running the numbers, doing diligent research, and even communicating with your team about their needs and capacities. In the long run, you can expect major savings in both money and time.