Internet Phone Service may sound like a real value when you compare the prices of VoIP Phone Providers with conventional home phone service. After all, you can get monthly service as low as $9.99 per month (and $2.99 per month for local and long-distance calls if you opt to use Skype). But there are hidden costs involved with VoIP Phone Service that you may not consider.

Taxes, Set-up and Connection Fees
Even with its low rate of $2.99 per month, Skype advertises a “connection fee” of an undisclosed amount. Some of the other well-known VoIP phone providers also advertise undisclosed “taxes and fees.” How much? It doesn’t say until you begin the sign-up process.

Early Termination Fees
Most VoIP phone providers require a one-year contract, and early termination fees apply. It’s worth noting that VoIP through your local cable company—the most common form of VoIP phone service—usually doesn’t require a contract and, therefore, has no early termination fees.

Overage Charges
One of the largest VoIP phone providers, Vonage, has several tiers of programs. The lowest cost calling plans limit the number of minutes you can talk, with rates up to 5 cents per minute when you go over the allotted minutes.

Read the fine print carefully before deciding on VoIP phone providers—if you talk a lot, your monthly bill may be higher than you expect. Of course, you can get unlimited calling through Vonage and other VoIP phone providers—at a price about the same, or just slightly less, than what you would pay with conventional phone service through your telephone company or VoIP through your local cable company.

Special Equipment
Some VoIP Phone Providers require special telephones or, at minimum, a VoIP adapter that connects to your high-speed modem and your home telephone. While most VoIP phone providers offer this equipment free of charge when you sign up—some don’t. Again, read the fine print carefully to see what’s included when you sign up for a VoIP phone plan.

Internet Service Costs
By definition, VoIP Phone providers (which stands for Voice Over Internet Protocol) require Internet access to use the service. You’ll need broadband Internet access, which means either a DSL line, broadband cable, T1 connection, or digital satellite Internet. Prices vary from about $30 per month, up to hundreds for digital satellite Internet if you are in an area without cable or DSL capabilities.

If you purchase your broadband Internet access through your cable company, and bundle it with your home phone service and cable TV, you will save more money than purchasing Internet service alone. Additionally, with a phone/cable TV/Internet bundle, you’ll have only one bill to pay. You may also qualify for special perks and benefits offered through your cable company. When you run the numbers, are you really saving money purchasing VoIP phone service separate from your Internet access?

Once you’ve decided on a phone service option, visit Allconnect to find the lowest rates on Internet access and home phone service, and then compare those prices with the rates you’ll get if you sign up for VoIP service.

Don’t forget to shop around for phone/cable TV/Internet bundles, which may be the best way to save money on all your home communication needs.

Tags: internet phone service, VoIP phone providers

This entry was posted on Thursday, August 12th, 2010 at 11:29 am and is filed under Home Phone Service, Internet Services. You can follow any responses to this entry through the RSS 2.0 feed. Responses are currently closed, but you can trackback from your own site.