VoIP (or voice over internet protocol) has become an increasingly popular alternative to traditional long-distance phone calls. The reason? Cost. A VoIP provider can reduce your phone bills by as much as 80%, more than justifying the initial costs of buying the equipment and monthly or annual fees.

Choosing to go VoIP is easy; which VoIP provider you sign up with is trickier. With the number of companies and the diversity of packages to choose from, it's hard to tell if you're really getting your money's worth. Here are some things to consider as you narrow down your choices:

• How much are you willing to spend? Look at your budgets. How much can you allot for this service? How much do you really save by getting it? • How much of your phone calls are long distance? If you rarely make long distance phone calls then you won't really feel the "savings"; but if you have friends and family around the world, then VoIP is a lifesaver. Look at your previous phone bills and make a rough estimate. Compute the cost of those calls on a traditional phone provider and through VoIP.
• How good is their customer service? Customer service is frequently the worst in companies that offer very low rates. They usually have a deluge of subscribers whose needs or quieries they may not be able to handle Check out how their after-salves customer service is by asking friends who use VoiP or VoiP sites that have message boards?
• What features are included in the package? Some packages may appear that they are cheaper but It could be because they have a very skeletal list of services. Others have a higher fee but offer so many additional services. But crucial to this is asking yourself which services are most important to you. Do you want call waiting? Do you need 3 way calling? Do you want fax capabilities? By defining what your priorities are you can weigh the overall monthly subscription fees with the kind of value you get for your money.
• Can you keep your old number? Some companies allow you to transfer your existing phone number to the VoIP service. This is a very helpful feature that saves you the trouble of informing others or, even more importantly, losng contact with those who were not told about the change. This can be too much of a risk to people who run homebased businesses.
• Do they offer emergency services? Not all VoIP services allow emergency numbers like 911. In this case it's advisable that you retain a cell phone or land line. It pays to be safe than sorry!
• How many international calls do you need to make? There is a wide variety of packages that appropriate a certain number of minutes for long distance calls. Find out your typical usage and assess how much you need.

Choosing a VoIP provider is an important decision.

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