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VoIP vs Landline - Top Business & Consumer Considerations 2020

Updated: April 3, 2020

Switching to a VoIP phone service has become an increasingly popular option for businesses and consumers because of the cost savings it represents upfront, but there are several other advantages that VoIP brings to the table. In this article, we'll take a closer look at what makes VoIP such a compelling technology for businesses and large organizations by comparing it to traditional landline phone service.


What Is VoIP Phone Service?

VoIP stands for Voice over Internet Protocol, which has become the standard protocol for handling voice connections over the Internet. VoIP phones are designed to connect to a router and place calls to nearly anywhere on the planet over the Internet. Because VoIP can receive and place calls to landline numbers as well as any device with an Internet connection and a phone number, it's more versatile and cost effective compared to traditional landline service.

VoIP vs Landline Comparison - Quick Links:


Network cable on one side and a large PSTN telephone tower on the other


Landline service is more expensive, especially in terms of long-distance calling. When a call is routed through the PSTN network, a dedicated circuit is opened between the caller and the number they are calling, and it must be held open until the call ends. This makes it necessary to build more capacity to handle call volume spikes during busy hours, and service providers charge their customers to maintain it. VoIP provides substantial savings because it uses the Internet to place long-distance calls, and your VoIP service provider doesn't need to cover the cost of building or maintaining a local phone network.



Landlines use a more reliable technology that's resistant to outages. Beyond this benefit, there are a few other advantages to using a landline phone service:

  • Low maintenance: Landlines rarely fail and last for decades before they need to be replaced.
  • Not affected by power outages: Landlines are powered by the local phone company, not the electric grid.
  • Security: Landlines can be tapped physically, but there's no data, servers, or software that can be hacked.
  • Value-added services like call forwarding, voicemail, and teleconferencing

VoIP also offers an array of features to consider:

  • Portability: You can receive calls on a VoIP device wherever it is if you have Internet connectivity.
  • Scalability: Adding more users only requires adding more handsets and phone numbers to your service plan.
  • Softphone technology: VoIP calling works with computers and mobile devices by using software that handles the Internet connection with other VoIP devices.
  • Unified Communications integration: VoIP can seamlessly integrate with other communication channels that use the Internet and digital technologies.
  • Anonymous calling
  • Voicemails can be converted to emails or text messages
  • Call forwarding, recording, and analytics services


Landline telephone service relies on a dedicated copper wire network called the Public Switched Telephone Network (PSTN). While PSTN is reliable and nearly immune to power outages, it's also more expensive to build and maintain. It has traditionally offered better access to emergency services because the 911 network was developed when landlines were the primary way to make voice calls.


A VoIP phone service, like other digital technologies, uses your existing local area network and public Internet infrastructure for connectivity. For a VoIP phone that connectivity is used to place voice calls. It does this by converting the audio of a voice call to digital data and sending that data over the network like other types of data such as images or video streams. The VoIP protocol conducts a handshake with another VoIP device to create a connection for the phone call, and then it manages the audio data sent between the caller and receiver until the call is ended.


Service Requirements

Landline phone services require physical wire connections with each phone line at a location, which means the landline infrastructure must be installed, maintained, and upgraded to increase the number of phone users.


VoIP phone service has two main requirements. First, it needs an existing network and Internet service to transmit voice data to and from the other end of a call. The customer also needs to provide a power supply. In office environments, the networking equipment already in place is usually sufficient for a VoIP service, but the existing routers and switches may need to be upgraded to improve call quality.



Landline phone service is more reliable than VoIP in most cases, being especially useful for emergency situations and power outages. The 911 emergency system was built on landline technology, and landlines have their own power supply provided by your local telephone company. VoIP's reliability is also good, but it does have the drawback of relying on functioning Internet service and power supply. It will fail during outages of either service unless there is a backup service in place.



One of the main selling points for adopting VoIP technology is that it can seamlessly integrate with other digital technologies like video conferencing, email, and text messaging. This means VoIP makes it possible to add voice calls to Unified Communications packages. Landlines, by contrast, can receive and make calls to VoIP phone numbers, but its integration with the digital world ends there.


Compatible Devices

One reason VoIP is a versatile technology is that it enables voice calling to and from a wide variety of devices ranging from VoIP handsets, smartphones, desktop computers, and messaging apps. Any device with an Internet connection, microphone, and speaker can be a VoIP phone. A VoIP phone number isn't tied to a particular phone line installed at a specific location, so you can receive calls on multiple devices anywhere you take them. Landline phone service, by contrast, is limited to wired and wireless handsets and desk phones.


A large modern office on one side and a small home office on the other

Consumer Considerations

For consumers, VoIP represents a more affordable option than landlines that can be bundled with Internet and other services, but the benefits of the technology are not fully realized for home users. Home consumers who regularly make long-distance and international calls benefit the most by switching.

Long Distance Calling

VoIP eliminates the cost of making long-distance calls by avoiding the long-distance per-minute tolls most landline services charge to make calls outside of their local area. If you make international calls, the bottom line is even more in favor of VoIP phone service. In return for these savings, the quality of long-distance calling is comparable to landlines.


Internet & Data Plans

Landlines are an added cost that must be purchased separately from an Internet service, but VoIP phone services are typically bundled with Internet and cable services, which can offer additional savings. Unless you make a large number of calls every day, VoIP won't impact the bandwidth of your Internet service in the way video streaming can.


Emergency Calling

Landlines are a good idea to have for emergencies because they are less likely to suffer outages. VoIP phone services have been integrated into the existing 911 emergency service system in recent years, and VoIP service providers in Canada are now required to provide it. The drawback of VoIP is that it’s more susceptible to service outages during blackouts or natural disasters.


Business Considerations

Businesses have two compelling reasons to consider switching to a VoIP phone service: reduced cost and integrating voice calls with other digital technologies. The disadvantages of making the switch are also less than they are for home users because of the volume of calls businesses make and the reliability of the service plans they can afford.

Long Distance Calling

Businesses incur large long-distance bills with traditional landline services because of the need to make long-distance sales and customer service calls, and international organizations need to make calls between locations that may be spread across many countries. VoIP slashes these long-distance calling costs to nearly zero at no significant loss of call quality.


Internet Bandwidth

The amount of bandwidth used by VoIP phone service is more significant for large organizations with call centers and multiple locations, but the amount of data used by VoIP is not as significant as other Internet usages like video conferencing or website traffic.



Businesses can purchase fully-managed hosted VoIP service plans that reduce the amount of downtime with redundant servers. Their Internet services are also more reliable than those offered to consumers, and businesses can invest in back-up power supplies. The result is that VoIP suffers fewer outages for business customers and approaches the reliability of landlines.


Integrations & Advanced Calling Features

One of the primary reasons VoIP phone service is adopted by businesses is to integrate their voice calling into Unified Communications platforms. VoIP also makes other phone services possible because it's based on digital technology. These include conveniences like archiving audio recordings and converting voicemails to emails or text messages. It also makes it possible to track voice calling data in business intelligence platforms, which helps management analyze customer service quality and call center performance.


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