VoIP guide: Save money by making calls over the internet

Many a family argument has been sparked by an unexpectedly expensive phone bill. Fortunately, the technology exists to significantly reduce the cost of calls, promoting harmony throughout your household.

VoIP, which stands for Voice over Internet Protocol, is a way of making calls over the internet. Many people are familiar with Skype, which is now a popular way of making voice and video calls online. Skype to Skype calls are free, while Skype to landline calls are cheap, even when calling another country.

But you may not be aware you can now completely replace your landline with a VoIP connection and receive incoming calls on your phone handset over VoIP, as well as benefitting from cheap or free outgoing calls. You won't need your computer; you just need to keep your modem switched on. You won't notice the difference until you receive your bill.

VoIP saves money by converting your voice call into data, which is sent over the internet. Its journey can take place solely over the internet to another VoIP phone, or through to the local telephone network if the call is to a landline. Either way, the whole process is much cheaper than normal calls over the telephone network. You can compare VoIP plans on Compare Broadband.

Naked DSL broadband and VoIP

If you can access ADSL2+ broadband at your home, you could opt for Naked DSL broadband and stop paying for line rental. Naked DSL broadband plans are usually slightly more expensive than a standalone ADSL2+ plan, but you will be making a significant saving every month by not paying line rental.

TPG

For example, if you were paying $29.95 a month to Telstra for your phone line and $49.99 to TPG for its 200GB plan, you could switch to Naked DSL and pay $59.99 for 200GB, plus 500 minutes of free VoIP calls and zero for line rental. That's an immediate saving of $19.95 a month, plus the savings you make by using VoIP for phone calls.

TPG's VoIP Minutes are only for calls to fixed lines in Adelaide, Brisbane, Canberra, Melbourne, Perth and Sydney. You can also make un-timed calls to friends and family on any landline nationwide for just 10 cents per call, while international rates are from 1.99 cents/min. This compares to 18 cents untimed local calls and $2 capped STD calls on Telstra's $29.95 plan.

TPG VoIP plans also come with a phone number, so you can receive calls as well as making them. You will need a VoIP enabled modem, which you can buy from TPG.

iiNet

If you make a lot of local or national phone calls, or those calls are not to state capitals, you could consider iiNet for your Naked DSL broadband and VoIP plan.

iiNet offers 100GB for $59.99, 400GB for $89.95 or a massive 600GB for $119.95 per month. iiNet provides iiTalk with all of its Naked DSL plans. All local and national calls on iiTalk are free, while international calls cost from 5c per minute. Another benefit of iiNet is BoB, which you can add to your plan for $9.95 a month. BoB is iiNet's name for its VoIP enabled modem combined with a wireless phone handset, and is perfect for a VoIP user.

Engin

Alternatively, you could look at VoIP specialist Engin. You can add an Engin VoIP plan to use with your existing broadband provider’s connection, or bundle an Engin Naked DSL broadband connection and VoIP plan together.

Engin offers a little less data on these plans, but for $89 a month you get 30GB of data and you can make as many local, national and mobile calls as you want for free. You can even make free international calls to eight countries, and 20-cent untimed calls to a further 13 countries.

While 30GB may not sound like much, you should bear in mind you can use this data any time of the day, as there are no peak/off-peak periods. Engin also offers a 50GB plan for $109.

VoIP plans

If you are looking for a VoIP service to add to your existing broadband plan, Engin has a range of plans, including one with free local and national calls, plus free calls to eight international destinations, for $19.95 a month.

What will I need?

You will need a VoIP enabled modem, which you can plug your phone handset into, or Engin offers a Voicebox, which plugs into your modem and your handset. Engin's 3102 Voicebox is $19 on a 12-month contract at the moment.

TPG offers a Dynalink VoIP enabled modem for $169.95, although you can save $20 if you are signing up to some ADSL2+ or Naked DSL broadband plans. iiNet's BoB costs $9.95 a month to rent, or $269 to buy outright on a 24-month contract.

Can I keep my current landline number?

When you go to Naked DSL, you can either get a new VoIP number, or with some providers you can retain your old phone number by transferring it over. However, if you do want to keep your landline phone, you can always bundle your landline, broadband and VoIP together and still save money on outgoing calls. That way you can use your VoIP number to make calls and your landline number to receive calls if you prefer.