Posted on May 7th, 2022.

As technology advances and companies adapt to ever-changing environments, many are ditching traditional landlines in favor of voice-over-internet-protocol (VoIP) services. These cloud-based utilities can help cut costs, improve remote collaboration and increase efficiency by integrating with other software.

Hundreds of VoIP providers exist, each with its own features and pricing. Matching your business with the right service can be a challenge, so Forbes Advisor examined the top options on the market and has ranked the best VoIP phone services. Find the best option for your needs and budget today.

Why You Can Trust Forbes Advisor Small Business

The Forbes Advisor Small Business team is committed to bringing you unbiased rankings and information with full editorial independence. We use product data, strategic methodologies and expert insights to inform all of our content and guide you in making the best decisions for your business journey.

We selected the 12 best providers and rated them according to factors such as transparent pricing, types of calling included in plans, integration compatibility, access to customer support and customer ratings. All ratings are determined solely by our editorial team.

The Best VoIP Services of 2023

RingCentral: Best For Comprehensive Features
Nextiva: Best For Ease Of Use
Grasshopper: Best for Small Business
8×8: Best For Businesses On A Budget
Vonage: Best For Customization
Dialpad: Best for AI
MagicJack: Best For International Calling

What Is VoIP?

A VoIP system is a communications system that uses a computer, smartphone, VoIP phones or WebRTC-enabled browsers to make telephone calls and transfer information from one location to another. It accomplishes this through an internet connection. It differs from a traditional phone, also called a landline, in how it sends information and data.

A landline uses copper wires to transmit analog signals. On the other hand, VoIP uses a broadband internet connection to transmit data. The data is transformed from the original analog data, transmitted as digital data and then turned back into an analog signal so that you can understand what is being said.

VoIP systems are often comprehensive office solutions offering voice mail, call recording, custom caller ID and voice mail-to-text features. Many offices use VoIP technology to create a unified communications system for the office that makes it easy for teams to communicate with customers and among themselves.

SIP vs. VoIP

SIP and VoIP are two acronyms that you will see when considering phone systems.

SIP, which stands for session initiation protocol, is a technology that facilitates many VoIP sessions. It is an open-source communications protocol that is fast between two points. It enables a number of desired data transfers, including voice, file sharing, instant messaging, video conferencing and multimedia sessions.
VoIP is technically just the voice component of the system’s capabilities. It is the protocol that allows voice telephone calls to be made through an internet connection. It is not limited to a specialized VoIP phone—you can call from a computer or mobile device with an internet connection.

VoIP technology can exist independent from more comprehensive SIP systems when all you need is phone call capabilities. When you need other data-sharing abilities, you need a SIP system. However, the marketplace often refers to more comprehensive solutions as VoIP solutions, creating confusion among consumers.

How To Choose the Best VoIP Provider

There are many VoIP service providers vying for your business. It can be hard to distinguish the best VoIP service for you. There are even some free VoIP providers. Here are some key things to look for in the best business VoIP services.

VoIP Cost

VoIP costs can vary depending on several factors, including the type of service, the number of users and the features included. Some providers offer flat-rate pricing, while others charge based on usage or the number of phone lines needed.

Factors that impact cost include:

Type of service: Cloud-based VoIP systems can be less expensive than on-premises solutions.
Number of users: The more users you have, the more expensive the service will be, but you may be able to negotiate bulk pricing with some providers.
Additional features: Some providers charge extra for features such as call recording, call forwarding and voice mail.

To reduce costs, you can:

Negotiate pricing with your provider
Choose a VoIP service that offers flat-rate pricing
Look for providers that offer free or low-cost international calling
Avoid unnecessary features and services

When choosing between a more expensive and cheaper option, consider the following:

What features do you need? A more expensive option may offer more features than you require, while a cheaper option may not.
What is your budget? A more expensive option may be out of your budget, while a cheaper option may be more affordable. Are there ways you can save money to afford the option you prefer?
What is the quality of service? Cheaper options may not offer the same level of reliability and customer service as more expensive options. Looking up consumer reviews will help you determine real user experiences with VoIP services.

Call Quality and Uptime

Several factors can impact call quality and uptime when using VoIP services. These include:

Network congestion: If the internet connection is slow or unreliable, it can cause delays, jitter and dropped calls.
Quality of Service (QoS): Quality of Service is a method of prioritizing internet traffic, which can help to ensure that VoIP calls are given priority over other types of traffic.
Codecs: Codecs are used to compress and decompress audio data, and the quality of the codecs used can affect call quality.
Hardware: The quality of the user’s hardware, such as their microphone and speakers, can also impact call quality.
Service provider’s network: Quality of Service and reliability of the service provider’s network play a huge role in ensuring call quality and uptime.

To assess a provider’s call quality and uptime during the buying process, you can:

Ask the provider for references and case studies from current customers
Read online reviews and ratings of the provider
Ask the provider about its network architecture, and what measures it takes to ensure call quality and uptime
Try the service out with a free trial period
Ask the provider about its service level agreements (SLAs), which guarantee a certain level of uptime and call quality (often, providers offer a 99.99% uptime guarantee)

Popular VoIP Phone Service Features

Key VoIP phone features to consider as you select a provider include:

Customer support: While most VoIP providers offer 24/7 support, some only offer it during business hours. Others charge extra for phone support. Consider your business needs and decide what’s best for you.
Toll-Free numbers: Not every company will need this feature, but if this is important to you, ensure that the providers you are considering offer it.
Automated attendant: Eliminates the need for a receptionist by using an automated system to transfer calls to the right person. An interactive voice response (IVR) system may be part of this solution.
Caller ID: Sets the tone for a call by informing you who is on the other end of the line. This is vital in sales and service industries.
Call holding: Allows you to place a caller on hold so that you can complete another conversation or piece of business before addressing their needs.
Call queuing: Automatically places callers on hold and identifies a wait list queue in the order that the callers first called in. This is also referred to as automatic call distribution or ACD.
Music on hold: Helps to keep callers on hold for more extended periods of time compared to listening to dead airtime when on hold.
Custom ringback: Similar to hold music, this is what your inbound callers hear while waiting to speak with someone. It is usually a message or a jingle.
Hot desking: Gives employees the ability to sign in to any connected device to access their messages and calls.
Call flipping: This is also called call pulling. It allows you to switch the call from one device to another while still on the call.
Conferencing tools: Allows for audio or video conferencing with employees or another group you create.
Call monitoring: Gives managers the ability to listen to calls for training purposes. A message that the “call is being monitored for quality assurance” is usually played at the onset of the call.
Call whispering: This technology allows a manager to whisper into the ear of the phone representative to help coach them through a call in real time.
Call barging: Allows managers to take over a call if the phone representative cannot handle the needs of the customer adequately.
Transcriptions: Useful written records of calls that can be used for training or evidence of call conversations.
Call recording: Gives managers the opportunity to review not just the words said but the tone and inflection that they were said in.
Speed dial: A time-saving feature that lets employees make often-called numbers with just a click or two.
Call forwarding: Lets calls get forwarded to another device so that you can get calls from another location other than the office.
Digital faxing: Eliminates the need for a nearly obsolete office machine. While most companies rarely use faxes, this gives them the ability to do so from a computer.
Integrations: Some VoIP systems can integrate with other software, like CRM platforms. This can help you to streamline key functionality within your business while improving your sales and customer support team’s productivity.
Call analytics: Gives managers key data about call times and critical insights about calls.
Live chat: A modern alternative that many consumers prefer to use rather than leave a message and wait for a callback.

Selecting VoIP Phone Features for Your Business

There are many other features to consider when selecting a VoIP system, beyond the twenty popular features we’ve noted above. As such, it’s essential to do your research in deciding what service plan to sign up for and what features will work best for your organization.

When selecting which VoIP system features to purchase through service plans or add-ons, you should consider the following:

How many people will have access to this service tool?
Does it make collaboration and communication easier?
Is it good value for the money?
Does it improve productivity and efficiency?
Will going without the feature harm your business?
Do you have any suggestions from clients or staff about using the feature?

Once you can answer a similar list regarding which VoIP features to invest in, you should move forward with choosing the best options for your business.

Benefits of VoIP

VoIP is a reliable system, because it uses the more reliable fiber optic and broadband cables that move internet data. Copper wires for landlines tend to be less efficient than fiber optic cables, leading to more dropped calls or noise on the line.

When you get a VoIP phone system, there are a lot of features that come with it. As a reminder, many of these benefits are the result of SIP technology but are packaged as part of your VoIP system.

For everything that it does, VoIP systems are still usually cheaper than getting landlines for the same number of phone numbers.

Drawbacks of VoIP

There are many advantages of VoIP, but there are also some disadvantages that you should consider before making the switch. One of the main disadvantages is that the phone system, thus the quality of calls, is completely reliant on the internet connection quality—the better the connection, the better the calls. However, if your internet connection goes down for any reason at any time, your phones also go down. Lesser-speed internet connections can also lead to call problems with dropped calls or jitter on the line.

Another problem with VoIP is that the connection is not always secure. This means that the calls can be breached easily with others listening to calls. It is important to check with the company you are contracting for VoIP services to see if they use high-level encryption to protect you and your company data.

A final disadvantage of the VoIP system is its use in emergencies. Numbers are not always local as businesses work to develop a presence in specific parts of the country while callers are in other locations. In an emergency, responders first look to the telephone number to locate the caller to render aid. If you don’t have an E911 emergency address connected to the VoIP line, it may take longer for responders to get to you.

How Does VoIP Work?

VoIP needs an internet connection to work. You’ll need certain hardware to transfer the data. The hardware includes a personal computer and cable modem. If you are calling from a telephone, you’ll need a phone adapter or you’ll need to use a VoIP-ready phone. The adapter converts analog signals into digital signals that allow them to be transferred over the internet. During the call, the data is transferred back to an analog signal so that the other party can understand what is being said.

If you’re using VoIP from a mobile phone, you can connect to the internet wirelessly to transmit the data. Data is stored in the cloud and accessed via a dashboard on the computer or mobile device. Data may include contacts and business phone numbers.

Fixed vs. Non-Fixed VoIP Services

Fixed VoIP services are provided through a dedicated internet connection, such as a DSL or cable line. They are typically more reliable and consistent in terms of call quality and uptime. They are also more secure, as the internet connection is not shared with other users. Examples of fixed VoIP services include:

Residential VoIP services
Business VoIP services
Hosted PBX services

Non-fixed VoIP services, on the other hand, are provided through a shared internet connection, such as a Wi-Fi or cellular network. These services are typically less reliable and may be subject to dropped calls or poor call quality due to network congestion. They are also less secure, as the internet connection is shared with other users. Examples of non-fixed VoIP services include:

Mobile VoIP services
WebRTC services
SIP trunking

Fixed VoIP services are more suitable for businesses that require a high level of reliability and security, while non-fixed VoIP services are more suitable for individuals or businesses that require mobility and flexibility.

VoIP Hardware and Equipment

VoIP hardware and equipment refers to the devices and peripherals needed to make and receive VoIP calls. While this varies by provider, there are four main types of equipment.

The types of equipment needed for VoIP typically include:

IP phones: These are specialized phones that connect to the internet and work with VoIP systems. They often have similar features to traditional phones, such as a keypad and display.
Adapters: These devices allow traditional analog phones to work with VoIP systems. They plug into the phone and convert the analog signals into digital signals that can be transmitted over the internet.
Headphones: Some VoIP services require the use of a headset or headphones with a built-in microphone. This allows for hands-free operation and better sound quality.
Conference phones: Some VoIP services also support conference calls, in which case a conference phone is needed.

Service providers typically offer a variety of equipment options and some providers include the cost of the equipment as part of their plans, while others may charge extra for the equipment or require the customer to purchase it separately.

Companies can also use their existing equipment, such as analog phones, with an adapter. However, the quality of the call may not be as good as it would be with an IP phone designed specifically for VoIP systems.

VoIP Use Cases

VoIP technology has many uses and can be beneficial for various industries and business scenarios. Some of the most common use cases include:

Remote workers: VoIP technology allows remote workers to make and receive calls as if they were in the office, increasing productivity and collaboration. This is especially useful for companies with employees working from different locations or working remotely.
Customer service centers: VoIP technology can be used to set up virtual call centers, allowing customer service representatives to work from anywhere with an internet connection. This can help to reduce costs and improve service quality.
Healthcare: VoIP technology can be used to connect doctors and nurses with patients, allowing for remote consultations and reducing the need for in-person visits.
Education: VoIP technology can be used to set up virtual classrooms, allowing students to attend classes remotely. This can be especially useful for students in remote areas or with mobility issues.
Retail and e-commerce: VoIP technology can be used to set up virtual call centers to handle customer inquiries and support. This can help to reduce costs and improve service quality.

VoIP technology can also be used for other industries such as construction, finance, nonprofits, government agencies and many more. As the technology continues to evolve and improve, the possibilities for VoIP use cases will continue to expand.

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