Business News Daily receives compensation from some of the companies listed on this page. Advertising Disclosure

See if your business is eligible for a tax credit of up to $26K per employee!

Call Now: 866-834-1218

Is a VoIP or Landline System Better for Your Business?

Kiely Kuligowski
Kiely Kuligowski

In the battle of VoIP vs. landline phone systems for your business, which one wins?

  • Deciding between a landline and VoIP phone system is not as simple as it sounds. Since both offer unique benefits, the best option depends on what your business needs.
  • Cost, internet connection and reliability are key factors to consider in your decision.
  • VoIP offers greater flexibility, but landlines are known for reliability and consistent quality.

The phone system you choose can be a make-or-break decision for your business. There are many things to consider when deciding between a landline and a VoIP system, including cost, reliability and functionality. While you may be inclined to write off a landline as an antiquated system compared to modern VoIP systems, there are many benefits to a traditional system that may work better for your business. Read on to see which business telephone system is right for you.

What is VoIP?

graphic of man in front of a computer

Voice over Internet Protocol, or VoIP, is a type of communication technology (comprising both hardware and software) that allows you to make phone calls using an internet connection rather than a traditional analog phone line that uses wires or optical fibers to make a connection. VoIP is also known as internet calling or IP telephony.

VoIP is transmitted through various methods, including traditional phones, smartphone apps, computer software and specific VoIP-enabled phones.

Editor’s note: Looking for the right business phone system for your company? Fill out the below questionnaire to have our vendor partners contact you about your needs.

How does VoIP work?

VoIP works by breaking up your voice into digital packets, like electronic envelopes, and sending those packets as data to the recipient over the internet.

VoIP is available in a variety of systems, making it accessible to anyone with a reliable internet connection. You can make VoIP calls via these methods:

  • A phone and VoIP adapter. With an adapter, you can use a regular landline phone to make calls over the internet. The adapters plug into a phone outlet in the wall or directly into your router.
  • A computer (i.e., a “softphone“). There are many programs or applications available that will let you make voice calls over the internet, including Skype, Google Voice and FaceTime.
  • A smartphone. With your smartphone, you can download apps, such as Google Voice or Skype, that allow you to make internet calls.
  • A dedicated VoIP phone. These look like traditional analog phones but connect directly to a computer network rather than a phone line.

Virtual receptionist

A virtual receptionist – often called a virtual assistant – can fill many of the traditional functions of a receptionist through fully automated features. It can answer phone calls, deliver recorded messages, direct calls and engage in a number of other useful services, all included in the VoIP packages.

Most likely, you have encountered virtual receptionists when calling customer support lines. The automated directories, including up-to-date information and changes to the system, can help resolve issues before a caller needs to be connected with another person.

Automatic call forwarding

Automatic call forwarding is one of the most useful features for anyone who utilizes it. Essentially, this will automatically take calls to the VoIP line and redirect them to another line of your choosing. Once common use is to redirect office calls to your cell phone while you’re traveling or working in the field. Calls to an individual can also be forwarded to a receptionist during important meetings. In general, this feature gives you more direct control over your own accessibility to others.

3-digit dialing

When there is an emergency, you know the number to call. There are only three digits, and you get directed to help. Imagine if such easy and reliable access existed for more than just emergency dispatchers.

Well, it does, and it’s called three-digit dialing. You can program any numbers you deem important and give them a unique three-digit code. This makes it as easy to remember and access numbers you frequently use as emergency services. If you can teach a small child to remember 911, then three-digit dialing gives you the same simplicity for any number that deserves it.

Voicemail to email

As the name implies, this is a service that transcribes voicemails into emails. It’s important to understand that this is not a voice-to-text feature. Voicemail to email does not create a written version of the message. Instead, it creates an audio file and emails it to you. This can make it easier to access through means other than your voicemail line and to save and/or share voicemail messages. With some versions of this service, you can even delete messages in your voicemail box from your email. It amplifies the convenience considerably. 

Did You Know?

An additional feature available with most VoIP phone systems is the ability to get a virtual phone number. These numbers aren’t tied to a specific device, but instead allow calls made to that number to be forwarded to other numbers, such as a personal cell phone. Grasshopper’s entire platform is built around virtual numbers. 

What equipment do you need for a VoIP system?

The equipment you need for a VoIP system depends on which type of VoIP you use. First and foremost, you need a strong, reliable and secure internet connection. Call quality and reliability depend on the strength of your internet connection, so it’s crucial that you can count on it not to drop service or be susceptible to hacking.

Next, if you are using an adapter, you will need a compatible landline phone. If your adapter plugs into a wireless router rather than a phone outlet, you will need to have a router.

To get VoIP over a computer, you will need a laptop or desktop computer with an internet connection, the proper software or program, and speakers and a microphone. Many people opt for a headset that plugs into the computer for better sound quality and ease of use.

If you are using a smartphone, you will need a smartphone, a Wi-Fi connection and a VoIP app. Most apps (Skype, FaceTime, WhatsApp and Facebook Messenger) offer free calls to other users with the same app, and other apps allow you to call a regular landline or mobile number, though this usually costs money.

There are also providers that offer a hybrid option where you can make VoIP calls using minutes included in your home phone plan.

Pros and cons of VoIP systems

VoIP systems are becoming more popular as the world continues to digitize. They offer significant perks like lower costs, increased reliability and better sound quality. But VoIP systems aren’t right for everybody, especially those with unreliable internet connections or businesses that require significant telephony features.


  • Low cost: The main benefit and draw of a VoIP system is its low cost. Because calls take place over the internet, you are only charged for internet access rather than for call minutes or for extra phone service. With traditional phone systems, a system with multiple lines can be expensive, and additional features like call transferring or queuing can run up costs. VoIP offers a budget-friendly solution for long-distance calling, since international calls over a VoIP app are often free.
  • Connection anywhere: VoIP systems offer enhanced functionality compared to traditional phone lines. The world of business is moving rapidly, and many professionals need to be reachable anytime and anywhere. VoIP phone systems enable this by automatically routing phone calls to your VoIP-enabled phone. Wherever you are able to connect to the internet, you can make and receive phone calls.
  • Sound quality: Sound is usually clearer with VoIP than with analog phone lines, but this too depends on your internet connection. A slow connection can negatively affect the quality of your call, but a strong connection typically results in clear, consistent sound quality.
  • Better functionality: VoIP solutions tend to offer greater function than landlines by allowing users to host video calls and transmit multimedia messages. Systems often include add-on features like voicemail, call analytics, anonymous call rejection and voicemail-to-text transcription.
  • Technology: Modern communication runs through digital lines, and VoIP digitizes voice communications. This makes it compatible with the latest technologies. VoIP can work through the newest headsets, smartphones, computer accessories and more. Any cutting-edge technology that uses your voice is going to work better with a VoIP system than a landline.
  • Reliability: The digital nature of VoIP makes for extremely reliable communication. IP information exchanges run through some of the most robust infrastructure on the planet. When this infrastructure is supporting voice calls, it adds considerable reliability to the process.


  • Emergency calls: A major con of VoIP systems is that they’re not guaranteed to support emergency call service, like a call to 911. This is largely due to VoIP’s flexible nature – any call from a traditional landline is easily traced to one geographic location, but VoIP (and mobile phones) can be used anywhere without being tied to one place. Thus, VoIP providers must have Enhanced 911 enabled. E911 customers set a physical address that shows up when they dial 911 on their phones. VoIP providers must cooperate with traditional phone companies that control access to the public telephone system and 911 operators, which can be complicated, because VoIP and the public telephone system are direct competitors. The best way to find out if a VoIP provider offers 911 service automatically, if it must be activated, or if it is not supported at all is to call the provider and ask.

  • Internet dependence: The second major con with a VoIP system is that, because it is fully dependent on the internet, you must have a strong and reliable internet connection to ensure decent sound quality and to avoid dropped calls. 

If you decide a VoIP connection is what you need, there are variety of top VoIP phone system providers. You can learn more about some of these in our Nextiva review.

What is a landline?

The landline phone system was invented in 1876 and has remained largely unchanged since then. Landline telephones work by sending signals through a series of physical switchboxes via copper wire from one phone to another, making them reliable and fast, though maintenance can be complicated and time-consuming.

Pros and cons of landline systems


  • Reliability: Traditional landline phones are extremely reliable. Because the connection uses wires, you can count on your service not to be spotty or spontaneously drop. This can be vital to businesses, both for maintaining productivity and because customers can consistently reach you. Additionally, when a natural disaster or bad weather strikes, phone lines tend to remain functional or can be fixed more quickly than the internet, which can reduce downtime for your business.
  • Consistent quality: If you have unreliable internet service, a landline phone can mean significantly better sound and call quality with no dropped calls.


  • Technology: The world is moving away from analog or traditional systems in many areas, and telephony is no exception. The ability to make a call from anywhere in the world at any time is becoming more of a business necessity. Landline systems do not allow that, potentially restricting your business capabilities.
  • Higher costs: Landlines are more expensive than VoIP systems, especially when you add features like voicemail, call waiting or caller ID. Landlines are also subject to taxes and additional fees, which further raise costs.
  • Spam calls: You may be more susceptible to spam calls on a landline than on a VoIP or mobile number. While it is technically illegal for telemarketers to call you on your cell phone, no such regulations exist for landlines. 

If you have a landline system, but what to take advantage of what VoIP has to offer, you can consider using s SIP trunk service. This allows you to use your legacy landline PBX equipment, while still making connections over an internet connection.

VoIP vs. landline: Things to consider

If you are deciding between a VoIP and landline system, these are some of the factors to take into account.

  • Equipment: You will need to determine what equipment you already have – like many landline phones, for example – and if you are willing to replace or get rid of that equipment should you switch systems.
  • Costs: Determine what features you pay for under your current system and what features you would like to have with your new system. Would those desired features be included in your package, or would they be separate add-ons? VoIP services tend to be cheaper than landlines, but they may lack some key business phone features.
  • Internet reliability: Landlines are known for their reliability in terms of call quality and resilience against outages. VoIP systems depend on an internet connection, so without strong bandwidth or constant connection to internet service, you will be unable to use your phone.
  • Scaling and maintenance: VoIP systems are easy to upgrade and maintain, while it may be difficult to scale or upgrade an analog system depending on how old it is. If you have a rapidly growing company or are unsure what your telephony needs will be in the future, a VoIP system may make more sense for you.
Image Credit: Chainarong Prasertthai / Getty Images
Kiely Kuligowski
Kiely Kuligowski
Staff Writer
Kiely Kuligowski is a and Business News Daily writer and has written more than 200 B2B-related articles on topics designed to help small businesses market and grow their companies. Kiely spent hundreds of hours researching, analyzing and writing about the best marketing services for small businesses, including email marketing and text message marketing software. Additionally, Kiely writes on topics that help small business owners and entrepreneurs boost their social media engagement on platforms like Facebook, Twitter and Instagram.