Landlines are on their way out, and modern businesses are embracing VoIP to run their communications systems on their broadband connection.
In this guide we’ll walk you through some of the features, benefits, pros and cons of VoIP for business, including some of the things to look for when choosing a provider.
What Is VoIP and How Does It Work?
VoIP stands for Voice over Internet Protocol – it simply refers to a communications system that uses the internet rather than a traditional phoneline to make and receive voice and video calls – think Skype, Zoom, Microsoft Teams and Cisco Webex.
But if you’d rather make and receive calls on a traditional office phone rather than through an app on your screen, you can connect your VoIP system to a handset on your desk. You can also use VoIP on different devices, such as your smartphone, laptop, or desktop computer.
With VoIP, spoken words are converted into packets of digital data, which are then transmitted through your broadband connection to whomever you’re speaking to, where their device converts the data back into sound.
VoIP is a cost-effective and scalable alternative to traditional analogue phones for businesses, but it does rely on a strong internet connection.
Pros and Cons of VoIP for Business
Cloud-Based VoIP vs On-Premises VoIP: Which is Better?
With cloud-based VoIP, the provider hosts the service, so you don’t have to worry about hardware, infrastructure, or associated maintenance. It’s usually easy to add or remove users, so a VoIP system can flex with your business needs. Subscription-based or pay-as-you-go pricing can be a good way for smaller firms to keep costs down.
Usually, you won’t be charged setup or installation fees, although you may need to pay for phone handsets or headsets if you want these. You get a portable communications system with automatic updates to keep everything secure.
The main downside is that you’re not in control of the infrastructure and maintenance, as you would be with an on-premises communications solution. You’re also reliant on having a strong and stable internet connection for your VoIP system to work.
An on-premises VoIP system is also known as a PBX (Private Branch Exchange). The system is installed on your company premises, and you have full control of the hardware and software. This means you can tailor and customise the system, adding extra security, for instance, as required. It can be harder to scale up, though, as you’ll need a physical upgrade to add many more users. The initial setup costs will be higher, and there will be ongoing maintenance costs, but larger businesses may have an in-house tech person to take care of this. You’ll likely have a more reliable system with better call quality if you opt for on-premises VoIP. Overall, this is more likely to suit larger businesses with more complex communication needs.
How Much Does a VoIP System Cost?
For cloud-based VoIP, you might pay a monthly fee from £5 to more than £50, depending on the needs of your business. Handsets can cost from £30 upwards.
What Affects the Cost?
A few things will affect the cost of your VoIP system:
Number of users: Most providers charge a monthly fee per user, so more users means higher costs for your business. You can probably negotiate a bulk discount as a large company with a lot of employees who need to use your VoIP system.
Call Volumes: The number of calls your business makes and whether they are long distance or not will affect the cost. You should be able to find or negotiate an inclusive minutes package that suits the needs of your company and saves you money.
Features and Add-Ons: The extra features you choose, such as CRM integrations, analytics, custom hold music, video conferencing or international call bundles, could add to the total cost.
Customer Support: The level of support you need and the hours it is available may affect the price you pay. 24/7, UK-based tech support on the phone will attract more of a premium than web-chat support during office hours only.
Hardware: Whether you’ll just use the provider’s free app or you need many desktop IP phones, headsets or extra routers to boost your signal, there could be equipment costs to budget for.
Contract Length: The length of your contract will affect the cost. Paying annual rather than monthly will usually be cheaper.
Best VoIP Providers 2025
Here’s a rundown of some of the best VoIP providers currently operating in the UK market, and where each of them stands out.
Dialpad – works on all devices through an app, no extra hardware needed. Uses AI to give you extra features like live transcription and sentiment analysis, integrates with other software such as Microsoft 365 and Google Workspace. Should appeal to digital-first businesses.
RingCentral – provides cloud-based VoIP with features including call forwarding and visual voicemail. Range of desktop handsets available, or you may be able to run RingCentral on your existing VoIP phones if compatible. You can also use your laptop or smartphone for calls using the RingCentral app.
BT Cloud Voice – a hosted VoIP system combining features of a traditional phone system with the flexibility of the cloud. Comprehensive, scalable VoIP solutions suitable for growing businesses, solid customer support.
Vonage UK – offers more than 40 features within its VoIP packages including call routing, local phone numbers, team messaging, voice and video conferencing. Good for small- and medium-sized businesses.
8×8 – designed to give companies an all-in-one platform which acts as a contact centre for customer service agents and helps employees communicate internally. Integrates with Salesforce, Microsoft Teams, HubSpot, Zendesk and other CRM apps, and prioritises analytics and security.
bOnline – aimed at small businesses and freelancers wanting a low cost, straightforward VoIP system with fast setup.
5 Best VoIP Packages For Business
BT Cloud Voice Connect
£11.74 (ex VAT) per user, per month – 60-month contract
BT promises world-leading security, robust support and a reliable network with its BT Cloud Voice VoIP packages aimed at SMEs. We like middle-priced tariff Connect for its range of useful features and flexibility over call packages, such as tailored bundles of inclusive minutes (eg for international calls) that can be shared across users for a fixed monthly price. BT Cloud Voice only works with BT’s own IP phones. You don’t need BT business broadband to get BT VoIP, but it might suggest you upgrade to one of its leased lines or fibre broadband lines if your existing broadband isn’t fast enough. Note that you’ll need to sign up to a long contract.
- · Automatic call routing
- · Call transfers including to mobile
- · Call multiple phones with one number
- · Voicemail to email
- · Voice and video conferencing with Cisco Webex built in
- · UK helpdesk available 24/7
Vonage Max
£25 (ex VAT) per user, per month
The top tier of its four business communications packages, Max comes with ‘all the bells and whistles’ including integration with your CRM system. You get the ability to record calls, an unlimited call queue, virtual receptionist, call groups and more than 30 calling features.
RingCentral RingEX Essentials
£12.99 per user, per month
A great budget option for small businesses that just need basic calling facilities, the RingEX Essentials plan gives you a package of inclusive minutes for a low monthly fee. Ring Central is currently rolling out a new AI tool called RingSense AI to simplify users’ daily tasks and improve communications. The AI assistant can take notes in real time, translate text and provide call summaries.
bOnline
£9.95 (ex VAT) per user, per month, or £15.50 (ex VAT) with IP desk phone included
Multi-award-winning VoIP provider bOnline promises a reliable phone system with high-quality audio backed by great customer service. Designed for freelancers, startups and growing small businesses, it allows you to set up your VoIP service in just a couple of minutes. bOnline aims for simplicity so you won’t find a long list of different tariffs to choose from.
Dialpad Standard
£12 per user, per month (when billed annually)
With its AI-powered solution, Dialpad’s landline-free VoIP system should appeal to modern, digitally-focused businesses that want to use technology to work more efficiently. Its service comes in three pricing tiers; the cheapest Standard package still gives you the benefits of Dialpad’s AI tools but should be enough for businesses without multiple offices and many staff members.
How Should I Choose a VoIP Provider?
Consider your monthly budget, customer support preferences, and whether the provider you’re looking at has a good reputation for reliability and solving any tech issues that may arise. Communications outages can be costly and disruptive to businesses of any size, so you’ll want fast tech support if you encounter any issues. Make sure the package you’re considering has the features you need and you’re not paying for things you probably won’t use. If you’re planning to use hardware such as phones and an existing broadband connection, make sure they are compatible with your new VoIP service and your network will be able to handle the traffic. Look at any data the provider has on call quality and uptime. Some providers will offer a free trial so you can test out a potential new service before committing to a long contract.
VoIP Hardware
IP phones
You can get wired desk phones or cordless handsets that are compatible with VoIP.
Adapters
You can buy adapters which convert analogue phones into digital ones so you don’t need to replace all your old handsets.
Headphones/headsets
For hands-free calling or using your laptop instead of a desktop phone, a headset is essential.
Routers/signal boosters
You may want to upgrade your broadband connection, or change your router to one that is more compatible with your chosen VoIP provider. Having a strong and stable internet connection is crucial for VoIP to work properly, so you may want to add signal boosters to make sure Wi-Fi reaches every corner of your office.