Broadband phones, also known as “VOIP” are catching on faster than ever. And no wonder, since the monthly cost of broadband phone service, including long distance, is probably cheaper than what you pay to your phone company for just a dial tone. Yes of course you need a highspeed Internet connection that you connect your broadband phone to, but a majority of homes have that anyway, so this is just another service that takes a minimal amount of that speed away, and only uses it when you are having an active conversation on that phone.

Yes, broadband phone service is extremely popular. In fact, about a year ago the number of new phone activations in the US that were broadband phones or VOIP phones surpassed the number of new traditional phone services for the first time in history! Yes, there are advantages, as well as some neat features offered by some (not all) of the broadband vendors. But there are also some disadvantages, so let’s take a brief look at both angles.

The Advantages

As stated earlier, broadband phone service is significantly cheaper than traditional phone service. Most broadband phone services include “unlimited” long distance calling in the continental US, as well as locally. With traditional phones, you either pay a huge premium for the unlimited feature, or even with a discount long distance plan, you are still paying about 2.5 to 3 cents per minute (or more) for long distance calls.

There are many vendors and companies offering residential broadband phone service, it seems like everyone wants to get in on this. But from what I have observed, the most expensive place to get it is from your cable company! Yes, your cable company, the same one who provides you with cable TV and maybe also cable Internet service, will typically offer you broadband phone service for almost TWICE what you can get it for elsewhere. It pays to be a knowledgeable shopper!

Yes, almost everyone has heard of Vonage, and this service can be purchased at places like Best Buy, Circuit City, even Walmart. But again, you are paying about 20% more than you need to, if you realized what else is available out there.

For long distance, some broadband phone plans include Canada for the unlimited calling area, and some also include Puerto Rico. Some like Packet8 have separate plans to allow you to call Europe and/or Asia. Be aware of where you want to call and verify if that is included in the carrier’s plan.

A word regarding the “unlimited” part – it’s not really unlimited, at least not according to the definition of unlimited that I read in my Funk & Wagnall. Most carriers allow about 3000 to 4000 minutes per month, then they may call you and ask you about such excessive usage, maybe thinking you are a business (higher rate) or using some kind of auto-dialer (a strict no-no).

The Disadvantages

Remember that with broadband phone service, you make and receive you calls via your highspeed Internet connection. You need to have a GOOD connection, not on the fringe areas of DSL. And if all you can get is satellite Internet, then hang it up, because VOIP on satellite is not going to be pretty at all.

Since you are using your Internet connection, it should be stated that if your Internet connection goes down, so does your broadband phone. That’s right, so if you need phone service and your Internet connection is not reliable, you may want to think twice about VOIP phone service.

Do you run part of your business from your home? If so, is fax any part of that? Today, from virtually any carrier on the planet, fax is not reliably supported, sending or receiving, via a broadband phone connection. If fax is important to you, you will want to have a phone line from the phone company dedicated to your fax machine, or subscribe to one of the online fax services.

Broadband phone service can save you a bundle, but you need to understand your usage requirements and needs before selecting which carrier is best. It is more, MUCH more than different carriers just having different pricing. You need to look at the whole package to ensure you are getting what you think you are paying for.