Recession Advice – Use VoIP to Make Cheaper Phone Calls

Britain’s largest home phone provider, British Telecom is set to increase its daytime call rate to 5.25p per minute in October 2009, according to a new report from consumerchoices.co.uk. In addition, the cost of a call set-up fee is also set to increase to 9.05p. While this could be viewed as a cynical move to encourage phone users to subscribe to flat-rate packages (such as BT’s Anytime Plan), there appears to be growing number of consumers who are getting wise to the idea that using VoIP technology can save them lot of money - after all cheap phone calls are an important factor to the lives of many domestic and business phone users.

What is VoIP? VoIP stands for Voice Over Internet Protocol. This is a generic term used to describe the number of methods that use the Internet and broadband networks to make and receive telephone calls. VoIP technology breaks voice calls into data packets which are transmitted via an Internet Protocol network, more commonly known as a broadband network. VoIP uses your existing broadband network already in place. So there is no need to lay new wires, build new networks or install new cables or sockets within the house. VoIP providers’ costs are kept to a minimum enabling them to offer cheap calls to consumers and businesses.

At their most basic, VoIP technologies only need a high speed internet connection (broadband) to facilitate VoIP calls. They require minimal installation and maintenance. In order to take advantage of the cheap services offered by VoIP providers, there are a number of options available to you. The cheapest way is to use the PC-to-PC method. This entails both users being at their computers and having a head set, a microphone and a speaker. Alternatively, they could use either a USB VoIP phone – a wired phone that plugs directly into the computer via the USB connection – or a ‘soft-phone’. This is a piece of software you can download that allows you to make and receive cheap phone calls again using either a USB phone or head set and microphone.

The PC-to-PC method is not going to be suitable for everyone however there are other more flexible VoIP alternatives. Where the PC-to-PC method demands that both users subscribe to same service and use their computers, PC-to-Phone calls are possible. This allows a PC user to call both landlines and mobile phones. This, however, is not free, as the caller is charged for outgoing calls.

Phone-to-Phone calls using VoIP technology is the most like for like alternative to a traditional landline service. This involves connecting a traditional phone handset into VoIP adapter, which in turn plugs into a broadband router via the spare Ethernet port. Your traditional home phone is transformed into a VoIP phone. Unlimited calls can then be made from your ‘VoIP phone’ to other landlines and mobiles. This method doesn’t rely on either the caller or receiver to be in front of their computers or for their computers to be switched on. With this method, the receiver doesn’t need to be connected to the same provider as the caller to make cheap phone calls either and calls are made just as they are with a regular landline to landline service.

VoIP removes the need for outgoing charges to landlines as VoIP providers typically offer capped or unlimited call plans. This means you can make as many cheap phone calls as you like all for a set monthly cost.

With the cost of traditional phone calls rising, it is small wonder that many consumers are turning to cheap calls offered by VoIP technology providers.