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BAY AREA BUSINESS PHONE SYSTEMS BLOG

How Much Does a Business VOIP Installation Actually Cost?

Posted by Randy Kremlacek on May 22, 2012 6:15:00 PM

Business VOIP Pricing is All Over the Board

It's true. You see a lot of crazy pricing claims from Business VoiP providers. At their best, they're difficult to understand and at their worst, they're just plain inaccurate. 

business VOIP installation cost 

No Free Lunch - Even With VoiP

Make no mistake, VoiP phone service is clearly a long term money saver for your business.  

But switching over from a traditional system does involve a cost. There's no free lunch. 

This article will attempt to cut through the marketing doublespeak and give you real pricing information you can use to make reliable business decisions about your business VoiP installation. 

VOIP Equipment Costs

VOIP phone service does radically reduce the amount of hardware and equipment you have to deal with at your premises. But they're still some hardware switching costs you need to think about. 

VoiP Phone Cables

A hosted VOIP phone is essentially a computing device.  You must have a data cable for each phone location. That’s not typically a problem for computer users but phones in warehouses, kitchens, etc. might require wiring.   The cost is approximately $75 to $250 per cable run, depending upon length and complexity.

Hosted PBX Phones

If you're switching from a traditional phone system to a VOIP-based system, you'll have to buy new phones. The cost of a hosted PBX telephone can range from $50 to $750, depending upon the size of screen, number of buttons, color or grayscale screen display and brand name.  

There are a few business VOIP providers who advertise  “free” telephones or at prices below cost.  There is no such thing as a free phone – you’ll just be paying for them over time with an increased monthly bill.  Over the period of the contract, that free phone will cost hundreds of dollars.

Phone Power

Did you know that a business VOIP phone requires external power?   On your old phone system, you just plugged in a phone and it powered up.  With VOIP phones, you need a separate power line.  

Power can be provided by a simple power supply to each phone or replacing your Ethernet switch with a new unit that provides POE (Power Over Ethernet). Individual power supplies range from $10 - $20 each and POE switches range from $200 to $1,500, depending upon size and features.

VoiP Capable Router (Gateway)

The router on your internet connection must be VOIP capable. Your router must reliably pass VOIP phone calls, with no one-way audio or drop-outs. Many routers are not capable of this.

A good VOIP provider will discuss router requirements up front and either provide a voice-enabled router as part of their solution or information on what equipment you must buy.

Pricing for routers can be as cheap as $100 or as high $1,500 depending on your requirements.

Business VoiP Set Up Costs

Setting up new equipment and services is a laborious process.  Each phone must be:

  • Provisioned (set up to work on your hosted PBX)
  • Greetings recorded
  • Call flow patterns programmed
  • Phone numbers moved over to the new provider 

These are just some of the tasks required to get your phone's working the way you expect them. 

Beware the vendor who says “you just plug it in and it works”.  That’s code for “Good luck buddy, you’ll be building your own phone system.”

How Much is a Business VoiP Installation for a Small Office?

Item Low High
Cable Run  $100  $150
VOIP Phone (each phone)  $50  $750
Telephone Provisioning (each phone)  Free  $75
Telephone Power (each phone)  $10  $35
Router $100 $1500
Virtual PBX Configuration Free $500

As you can see, installation costs can vary widely. Factors such as your office's cabling needs, your employees' phone requirements and your average call volume can all affect your installation costs considerably. 

But assuming you have a small business of 25 employees for example, you can expect installation costs to range from $2,500 to $15,000 total. 

If you have more questions and have a business in Northern California, contact Teledynamic. We can answer your questions and give you an estimate that will make sense for your business. 


Is your company ready for a Business VOIP installation? Find out with our Free VOIP Assessment!

Topics: Internet Circuits

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