Tuesday, October 20, 2009

Residential and Small Business VoIP Rates Crushed

VoIP telephony, sometimes called broadband phone service, has gone from a geeky computer app to full-fledged competition for mainstream telephone service in the course of a few years. The enablers for this have been the widespread replacement of dial-up Internet access with broadband services and the installation of Internet connections in small businesses. But just as ample rain leads to bumper crops, ample broadband has led to a bumper crop in VoIP providers. One of the most aggressive in this space, Phone Power, is now tweaking the industry by causing rates to plunge to less than $15 a month on unlimited residential and small home-based business service plans. That cost plummets even lower to just over $8 a month when you prepay for a year.

Granted, you can still pay even less for specialized services such as MagicJack and Skype. But both of these require you to use your computer as part of the phone system. When the computer is off, so is your phone. Plus you’ve got to deal with potential contention for processor resources when you try to use the phone while you are actually using the computer.

Phone Power and many other VoIP services that vie for your telephony dollar don’t work that way. They share your broadband connection in lieu of a traditional telephone line but don’t have any connection to the innards of your computer. Instead, they use a hardware device called an ATA or Analog Telephone Adaptor to turn a phone jack into an Ethernet jack that connects into your router or broadband modem. Phone Power gives you the adaptor free while you are using their service. Some other vendors also do that or you can buy an adaptor at your local electronics outlet.

The cost of VoIP phone services seems to have settled into the $20 to $30 range for aggressive services that you see heavily advertised and somewhat more for some of the familiar name bundles. That’s not unreasonable, considering that VoIP has typically offered both unlimited local and long distance calling. A traditional landline plan is local service only with an additional per-minute charge for long distance calls. Additional features, such as Caller ID, are usually offered as ala-carte add-ons to your basic service.

The big telephone carriers also offer competitive bundles of local and long distance minutes or unlimited calling plans with popular features included. But at $14.95 a month? Try twice that. When you look at Phone Power’s 12 Month Prepay option, the difference is even more pronounced. This is a new customer promotional rate for $199.95 prepaid for a year’s service. But as part of this special promotion, Phone Power will include a 2nd year’s service for free. That brings your equivalent monthly rate down to about $8.33 for unlimited calling to US and Canada numbers and free lease of the telephone adaptor.

This offer is intended for residential addresses, including home office users and home-based businesses. If your business is large enough to have its own physical address, there are also business packages available for single and multi-line users, with a wealth of add-ons and upgrades to give you the power of a on-site PBX phone system without the capital expense.

If you are considering switching your residential or business phone service or are just feel you are paying too much for the service that you have now, you should take a look at Phone Power Residential and Business VoIP before you commit to buying any other service.

Follow Telexplainer on Twitter