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I cancelled my home phone line last year after many years with POTS (Plain-Old-Telephone-Service), and I replaced my home phone with a VoIP service provider which provides a variety of services including conversion of voice mail to email messages.

My goal was to reduce my monthly phone expenses to $20/month, but the service includes nearly $10/month in taxes and fees. I could just cancel the service, and save the costs, but I do like having a home phone.

How can I find out what other home phone alternatives exist, and how much each might cost for my area? Is there an online source providing information about the various service providers? What are the big pros and cons of the various ways to get phone service?

  • We can't have product recommendations, but your question DOES have potential in asking how to shop for and what to watch. You already started to answer it. – MrChrister Jan 17 '14 at 18:10
  • I am going to re-open this based on this meta topic: meta.money.stackexchange.com/questions/597/… I think we have a good "how to save money" answer specifically about finding the cheapest type of phone service. – MrChrister Jan 18 '14 at 17:11
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Cheapest is one thing. You can absolutely shop in the market and find the lowest possible price. I can think of three places to shop, each with an up and downside.

I would think that what you really mean is the best price for the service. Just like shopping for a car you have to decide what you need vs what is nice to have.

How To Shop

  1. Decide what features you need. Do you need long distance? Do you need caller id? Do you need to call technophobic friends and family?

  2. Find out what you have available to you through associations. Often schools, work or a club you belong to have deals for service discounts. Look at your insurance plan or AAA membership for the crazy discounts.

  3. Decide what kinds of service will meet your needs.

  4. Buy the cheapest service.

DO NOT ENTER A CONTRACT. Even if the price is slightly lower. At least not at first. If you try out your service and love it, enter the contract if and only if the total price measured over length of the contract is less. With cell phones especially, it is absolutely possible to save money buying month to month vs a 2 year contract. Even when you buy equipment for full price up front.

Services to Consider

Call the current phone provider

Ask for the bare minimum service from your local phone company.

Because phone companies are often regulated monopolies, they might have a bare minimum level of service they are required to offer by the municipality. They probably don't advertise it or push it, but it might exist if you call and ask. You basically get a dial tone.

http://www.fcc.gov/guides/local-local-toll-and-long-distance-calling

  • The base level plan is as cheap as you can get from a telco
  • You have a wire service that works in a power outtage
  • Emergency services are designed to work with wirelines, so they work best with wirelines
  • Price is dictated by a government board, so you don't have to worry about shopping for deals

  • Not the cheapest possible solution

  • Long distance is not included
  • No extra features like call waiting, caller id or voicemail are not included

Go cellular only

This is popular plan the youth oriented market, but more and more people of all demographics are using their cellphones only. There are downsides (911, etc) and shopping for the best cell phone plan can be a full time job, but it does offer a way to save money by simply not having home phone service.

  • One phone number that works everywhere you are
  • Long distance included
  • Voicemail, caller id and other extras often included
  • Easy to shop (albeit tedious) for better or cheaper service on a whim
  • Easy to find non-contract providers
  • Might be possible to score organizational discounts through work or groups you belong to

  • Cellphones require batteries, and can go dead (not good for emergencies)

  • Emergency services are far less precise in locating you, if they can at all (even in your home)
  • A bad cell phone plan can be prohibitively expensive
  • Contracts could be offered, and contracts are not usually a great thing

Use a VOIP provider

Voice over Internet Protocol uses your existing Internet connection. You can buy a cheap regular phone and plug it into the VOIP box and use it like any other phone. VOIP can either be very inexpensive for all the features you get, or just plain inexpensive. There are providers who sell a monthly service, yearly service or no service plan at all. (You buy a device and get service as long as you own the device.) Taxes to the government are always due, so nothing is ever free.

Sometimes the provider is just computer software, so a minimalist would like that.

  • Some VOIP providers use computers to make the sound quality great
  • Behaves just like a home phone, but typically have many more features
  • As the newest competitor in the market, VOIP providers are cheap
  • You can take your hardware anywhere there is an internet connection and have your phone number with you (like a vacation, or child away at college)
  • Emergency services are more reliable than cellular (if you follow extra steps to set them up)

  • Can be confusing to buy. Some require contracts, some special devices, some require a bit of technical know how to setup. Be sure to evaluate the total cost of ownership when comparing prices

  • Can be bundled by other service providers, and that probably isn't as good a deal as it sounds
  • No power? No phone service (even if your phone doesn't require power itself)
  • Internet down? Phone is down
  • If this type of response isn't what the community expects to find on Money.SE - hit up meta and refine our mission! – MrChrister Jan 18 '14 at 17:41
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How low you can reduce your costs does depend on your calling pattern. How many minutes per month you call locally; call long distance; call internationally; and how many minutes you receive calls for. If all these figures are low, you can be better off with a pay-per-minute service, if any of the outbound figures are high then you could consider a flat-rate "unlimited" service. So that's the first step, determine your needs: don't pay for what you don't need.

Per-Minute

For example, I barely use a "landline" voip phone any more. But it is still useful for incoming calls, and for 911 service. So I use a prepaid pay-per-minute VOIP company, that has a flat rate (< $2/mo) for the incoming number, an add-on fee for the 911 service (80c/mo), and per-minute costs for outgoing calls (1c/min or less to US, Canada, western Europe). I use my own Obitalk box (under $50 to buy). There is a bit of setup and learning needed, but the end result means my "landline" bill is usually under $4/mo (no other taxes or fees).

Example Companies and Forum

Companies in this BYOD (bring your own device) space in the US/Canada include (in alphabetic order), Anveo, Callcentric, Callwithus, Futurenine, Localphone, Voip.ms and many others. A good discussion forum to learn more about them is the VOIP forum at DSLreports (although it can be a bit technical). There is also a reviews section at that site.

Flat Rate

If your usage is higher (you make lots of calls to a variety of numbers), most of these companies, and others, have flat-rate bundles, probably similar to what you have now. Comparing them depends on your usage pattern, so again that's the first thing to consider, then you know what to shop for. If you need features like voicemail or voicemail transcription, be sure to look at whether you need an expensive bundle with it in, or whether you're better off paying for that seperately.

On-Network

If your outbound calls are to a limited number of numbers, such as relatives far away or internationally, consider getting a similar VOIP system for those relatives. Most VOIP companies have free "on network" calls between their customers, regardless of the country they are in. So your most common, and most lengthy calls, could be free.

The Obitalk boxes (ATA's: analog telephone adapters) have an advantage here, if you install them in yours and relatives houses. As well as allowing you to use any of the "bring your own device" VOIP companies like those listed above, they have their own Obitalk network allowing free calls between their boxes, and also to/from their iOS and Android apps. There are other ATA's from other companies (Cisco have well-known models), and other ways to make free calls between them, so Obitalk isn't the only option.

Incoming

I mentioned above I pay for the incoming number. Not every supplier has incoming numbers available in every area, you need to check this. Some can port-in (transfer in) your existing number, if you are attached to it, but not all can, so again check.

You can also get incoming numbers in other areas or countries, that ring on your home line (without forwarding costs). This means you can have a number near a cluster of relatives, who can call you with a local call. Doesn't directly save you money (each number has a monthly fee) but could save you having to call them back!

  • I like that you listed providers, and the minimalist service is attractive. – ChuckCottrill Dec 30 '14 at 4:15
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Try to use VOIP service provider or web enabled conference calling services in your home phone. Now a days communication technologies have seen a boost as well as integration of different formats and platforms which easily reduces phone bills of a user.

Service such as UberConference, Skype, Webinar etc enables audio/video as well as web conferencing feature for their user.

Service tiers such as free plans, basic plans and business plans allow user to use these conference calling services per their need. Have a look at any such service and use it as an alternative of your home phone line.

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