What the best VoIP service has

  • E911 availability. Enhanced 911 service (E911) automatically provides the caller's number and physical address to emergency personnel, but some software-based VoIP services cannot be used to call 911.
  • Local number portability. Most companies allow customers to keep their original phone number, but this sometimes incurs a charge.
  • Alternate or virtual numbers. By choosing an area code separate from the one you live in, you may be able to save out-of-state friends and relatives some money.
  • Calling features. Free features may include call waiting, call forwarding, conference calling, voice mail, caller ID, an online call log, do-not-disturb setting and more.
  • Compatibility with other equipment and services. For now, not all home security systems, TiVo boxes and satellite TV receivers with internal dial-up modems work with VoIP, so you may not be able to retire your landline if you use it for these purposes.
  • Multiple lines. Some services only allow one line per converter box, while others have multi-line offers.
  • Fax compatibility. Not all services support adding a fax machine, and those that do may charge extra.

Know before you go

  • What kinds of calls do you make? You'll need to assess what you're currently spending on local and long-distance calls to determine whether VoIP will save you money. Most VoIP services charge a flat rate for unlimited local and long-distance calls in the U.S., and many include Canada and Puerto Rico.
  • Depending on the service, things can get more costly for international calls. Some plans, such as Vonage, include some international calling, but be aware that only calls to landlines are included in their unlimited calling plans. Calls to international mobile phones cost more. Software-based VoiP like Skype and Google also offer free video calling.
  • Will you keep your landline? Because E911 service isn't yet universally available, experts say you should consider keeping a basic landline or cell phone for emergencies. Be sure to include that cost in your usage estimates. In addition, a landline will usually still work during a power outage; VoIP will work only if it's hooked up to a battery backup.
  • Check for hidden costs. Most VoIP services include an adapter for your phone, but not all do, so be sure to check when comparing plans. Many services charge fees up front for setup and/or shipping equipment. Also, be sure to determine the costs you will pay for international cell phone calls, which are not included even in all-inclusive overseas calling plans. Also check the taxes and fees that will be added for your area.
  • Investigate trial periods and cancellation policies. Usually, you will be refunded your money if you cancel your trial within a specified minute usage and time frame. However, you may still be charged for calls not included in your plan, as well as for directory assistance, international cellular calls and possibly for deactivation fees and shipping charges to return equipment.

VoIP Runners Up:

Vonage Est. $12 per month and up

2 picks including: About.com, The New York Times…

Skype Free

1 pick including: Laptop Magazine, Macworld…

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