VoIP Gateway: Definition, Cost, Features & Providers

A voice-over-internet-protocol (VoIP) gateway is a device that uses an IP to connect copper wire phones to your router to transmit and receive voice communications over the internet. These devices are helpful for offices that do not want to abandon the reliability of their landlines but also want to leverage VoIP features.

If you have a traditional landline, getting a VoIP gateway is a great start to access powerful internet phone features. If you are looking for a new VoIP service to power your gateway, we recommend RingCentral. On top of features like unlimited domestic calling and conferencing, the service comes with a mobile app so you can take your number on the go. Click the link below to start your seven-day free trial.

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How a VoIP & SIP Gateway Works

Sometimes referred to as a session initiation protocol (SIP) gateway, a VoIP gateway receives telephony traffic from copper landlines and converts it per IP into data that can be transmitted over a network. The devices have ports that you plug your landline cord into as well as ethernet ports just like a router, which allows users of traditional phone devices to access VoIP features without having to get rid of their existing landline devices or infrastructure.

While these devices have similar ports on their sides, they are not routers, and typically are ordered specifically from an equipment dealer, either online or through one of your regional providers. However, once ordered, they can either be connected to your modem by yourself, or you can hire the dealer to do it for you. There is often a setup wizard included with the device that you configure on one of your office computers.

Because VoIP or SIP gateways connect landline phones to the internet, they make it possible for users to enjoy some of the benefits of internet-based calling, without requiring new desktop phones. For instance, you can make free unlimited long-distance calls because calls are going over a data network rather than a landline system. You also get call conferencing and the ability to effectively use your landline number anywhere via a mobile VoIP app on your smartphone.

It is worth noting, however, that if you want to use a gateway, you will need to subscribe to a monthly VoIP service. As a result, when you consider the cost of the service, along with the monthly cost of a landline, this is by far the most expensive way to enjoy VoIP features in your office. Therefore, before looking into these systems, you should take a hard look at your company’s budget and determine whether or not you absolutely must keep your landline system in place versus going with an all-VoIP option with softphone capabilities.

With this setup, the small business also has its phone system connected to IP as well as a mobile network

Types of VoIP Gateways

There are two types of VoIP gateways. Analog units allow you to regular landlines to a VoIP gateway. This is helpful for businesses with existing landline phones that want to “modernize” their network. Digital units, on the other hand, allow you to connect one or more digital lines to one another. These are normally used by large companies to accommodate large numbers of phones and will not be the main focus of this guide.

While this is a lot of extra equipment, it is the only way to leverage VoIP features like free long distance calling, visual voicemail, and other features without having to give up your VoIP landline. Otherwise, you can abandon your landline and start fresh with a highly rated all-internet business phone system.

Who a VoIP Gateway Is Right For

If your business uses a landline phone setup and you want to enjoy all the benefits that VoIP services have to offer, then a VoIP Gateway might be a good fit for you. These devices let you plug in your landline phone and convert calls to IP so that you can enjoy VoIP features like unlimited domestic calling, conferencing, call routing, and more.

• Older companies: If your organization has been around for more than 25 years or so, then you are probably using an older landline phone system. VoIP gateways allow you upgrade your existing phone without having to rehaul your network completely.
• Rural organizations: An all-VoIP system isn’t viable for most rural businesses that do lack access to fast, reliable internet connections. With a SIP gateway, you can unplug your landline phone and reconnect it to a traditional landline setup in case of a service outage.
• Companies with phone number recognition: If your organization is a household name in your local community, your customers probably have your phone number committed to memory. A VoIP gateway lets you modernize your phone setup without having to get rid of your old number.

“We implemented a VOIP gateway several years ago and have never looked back. The cost savings have been significant, particularly on long-distance calls.”
―Antony Zagoritis, Lapigems.

While most newer businesses will find it most effective to start using VoIP and virtual business phone systems, that is not an option for long-standing organizations. VoIP gateways are helpful in the sense that they let you keep your landline phone, but also bring in new features made possible by internet connectivity.

VoIP Gateway System Costs

VoIP Gateways vary by type and can cost anywhere from $50 for a home office device to as much almost $10,000 for large office adapters. You will also have to factor in the cost of a monthly subscription for a business VoIP system like RingCentral.

A business considering using a VoIP gateway should consider the costs related to VoIP gateway devices, VoIP subscription fees, landline service, and handsets.

VoIP Gateway Devices

You’ll want to have an available gateway phone port on the device to accommodate each handset. You can get VoIP gateways for as little as $50 that only accommodate one phone. However, gateway devices with eight ports cost around $350. Enterprise-grade gateways have dozens, sometimes hundreds of ports and can cost more than $8,000 depending on the number of phone ports.

VoIP Subscription Fees

If you want to use VoIP features, you will have to pay a monthly or annual fee for a VoIP service in addition to your landline service. Basic services like Phone.com start at just 12.99 per user, per month but go all the way up to $115 per user, per month for the most expensive package of 8×8. We recommend reading our buyers guide to VoIP systems for more information.

Landline Service

You will still need to subscribe to a landline service for your VoIP gateway to work. The cost of your landline will depend on what providers are available in your area, as well as how many lines you need for your office. For more information on landline costs, check out our comparison of VoIP vs Landline phone networks.

Handsets

If you are in the market for a VoIP gateway, you probably already have a landline service, which means that you probably have landline phones in your office already. Business handsets can range anywhere from $40 to as much as $500 depending on features like conferencing, headset compatibility, high-definition (HD) voice, and voicemail controls. However, many business landline companies include handsets with the service package.

VoIP Gateway Features

All told, VoIP gateways have a simple job. They connect traditional landline public switched telephone network (PSTN) audio into data, and effectively connect a traditional phone system to an IP network. This makes them an essential part of any modern business phone network reliant on traditional phone infrastructure or equipment.

This is because VoIP gateways offer several additional benefits.

Unlimited Long-distance Domestic Calling

If you make a call to another state with your landline phone, your service provider will charge you a per-minute rate for the call because you are taxing their copper-based network. When calls are made over VoIP, that problem does not exist because data can travel any distance easily. If you make a lot of long-distance calls, then a VoIP gateway can be helpful.

International Calling

Many VoIP services charge a lower per-minute rate for international calls than their landline counterparts. However, systems like 8×8 offer plans that let you make unlimited international calls to dozens of countries. This is especially useful for teams with an overseas business presence.

Conferencing

Many traditional landlines allow you to make three-way calls. Once connected to a VoIP system, that limit goes up quite a bit. If your phones are connected to the internet via a VoIP gateway, platforms like RingCentral let you hold conferences with hundreds of participants at once. Being able to hold large meetings over the phone can be transformative for your team’s productivity.

Mobile App

With an all-landline setup, you can only use your landline number if you are physically in your office. However, RingCentral, 8×8, and many other systems offer a mobile app that lets you make and receive calls with your landline number no matter where you are. All you need is an iOS or Android device, and you effectively have your business number on your personal mobile phone.

VoIP Gateway Providers

The providers available to you depend on the type of VoIP gateway device you want. It is hard to estimate exact prices as a lot of costs are based on what third-party providers are available to you and how much they want to charge. However, here are a few providers to keep in mind when deciding on a VoIP gateway:

1. Analog Gateways

You can buy analog gateway devices from vendors like Patton, which offers its line of SmartNode gateway devices. The biggest difference between the devices is the number of available phone ports on the back of the device. Prices range from $297 for the four-port SN4114 4-FXO device and go up to $1,038 for the SN4416 model, which accommodates 14 ports.

2. Digital Gateways

If you are a larger organization, Grandstream offers a range of digital gateways in its GXW line. The gateway can accommodate anywhere from 30 to 120 lines at once. Prices range from $999 to $2,999, depending on how many phone lines you are trying to connect.

3. VoIP Services

If you want VoIP features, you will need a business VoIP subscription in addition to the landline service you already pay for. We recommend RingCentral as it is one of the most powerful systems of its kind. Prices start at $29.99 per user, per month, and go all the way up to $44.99 per user, per month, depending on the service package.

Benefits & Drawbacks of a VoIP Gateway

VoIP gateways provide internet telephony features to businesses that have landlines and cannot convert fully to a VoIP-based network. While this is extraordinarily helpful, VoIP gateway devices aren’t all that useful for new businesses, solo workers, or freelancers with no existing landline infrastructure.

Pros of VoIP Gateways

Advantages of a VoIP gateway include

• Versatility: VoIP gateways include the proven reliability and call quality of a landline, but they also let you connect those lines to the internet and enjoy VoIP features.
• Cost savings on calls: When your landline is connected to the internet, you can enjoy features like unlimited long distance calling. If you take calls from all over the country, then you might see a huge cost savings over just using our landline on its own.
• Mobility: Most of the leading VoIP services offer mobile apps for making and receiving calls. This means that you can take your business phone number with you wherever you go on your Android and iOS device.

Cons of VoIP Gateways

Downsides of a VoIP gateway include:

• Setup headaches: If you don’t know a lot about computer networking, then you will likely find setting up a VoIP gateway to be very difficult.
• New businesses: If you are a newer organization and do not have a landline phone, it is much more affordable and intuitive to set up an all-VoIP network that runs entirely over the internet.
• Service outages: If you lose internet service, you will have to disconnect your landline from the gateway device and reconnect it to your phones manually.

Alternatives to VoIP Gateways

If you are in the market for a new business phone system and do not have a landline, then we recommend going with a full VoIP telephone network. It will save you the monthly cost of landline service, it will be easier to set up, and it will also provide all the benefits of a VoIP system that you get with a gateway device. You can deploy a VoIP system with either an IP, hosted, or virtual public brand exchange (PBX) system.

VoIP gateway alternatives include IP PBX, hosted PBX, and virtual PBX.

IP PBX

An IP PBX uses digital phone signals to send calls rather than traditional landlines. You connect VoIP phones to the PBX, connect the device to your router, and set up the system through a management console on your laptop.

However, an IP PBX is much more expensive than other types of VoIP-based PBX systems because you need to buy and install the hardware, which can cost $1,000 and up. It can be a good option for larger businesses since you generally don’t have to pay as much in monthly service fees compared to a hosted PBX.

Hosted PBX

A hosted PBX is a newer PBX phone system technology. It uses VoIP phone signals like an IP PBX, but you don’t have to purchase physical PBX hardware. Instead, the system is hosted in the cloud, which allows you to manage PBX features like call routing, transfers, auto attendant, and voicemail from your internet browser or smartphone. Hosted PBX systems are more affordable and easier to set up than an IP or traditional PBX.

Hosted PBX like Nextiva systems are generally going to be a better fit for most small businesses because they are extremely easy to set up and do not necessitate the cost of an expensive PBX box. These systems offer all of the phone features you’d expect for your business, but without the added hardware costs. All you need for these systems is high-speed internet. For more information, check out our guide to setting up a VoIP service.

Virtual PBX

A virtual PBX can be thought of as a “light” version of a hosted PBX. It works the same way as a hosted PBX but offers fewer features. They can only forward calls to an existing mobile, landline, or VoIP phone number. These systems can receive calls and route them based on predefined rules such as forwarding calls to different departments or individual extensions. Setup time is virtually immediate.

They are more affordable upfront, but they still require you to have another business phone system in place so that you can receive these forwarded calls. However, they can be expensive in the long run since you will still need to pay your cell phone and landline bills on top of the PBX subscription. Virtual PBX systems are ideal for solopreneurs and freelancers who want a business line that they can add to their personal phone.

Frequently Asked Questions (FAQs)

What is the difference between a VoIP gateway and a router?

A gateway is a conversion between VoIP phone data and traditional landline audio. A router looks at an IP address in a data packet and decides whether the packet should move outside the network. You generally need both types of device in your office.

Can I send and receive faxes on a VoIP gateway?

If you connect your landline system to the internet via a VoIP gateway, you can use the technology to send faxes. This is especially helpful as it provides the ability to receive faxes as .pdf files in your email inbox.

Will a VoIP gateway provide me with a Caller ID?

When someone calls you, you will be able to look at your handset display and see the caller’s name and number the same way you would on your landline system.

Can I use my business phone on my desktop?

If your VoIP service supports it, you can use a softphone app on your desktop computer. For more information on the subject, check out our buyer’s guide on the best softphones of 2019.

Can I use my VoIP gateway with cellular calls?

In some niche cases, a VoIP gateway can even convert landline traffic into cellular voice transmissions. You could have a termination carrier system to send calls over a wireless network. While this is a niche use case, it is useful if you want to use your landline number to make wireless calls.

Bottom Line

A VoIP gateway is a useful device for older business owners who don’t want to do away with their landline setup but want to enjoy the benefits of what VoIP technology has to offer. While newer businesses might want to consider an entirely VoIP network, a VoIP gateway is a huge benefit to companies straddling the line between the traditional and the modern.

Teams looking for VoIP phone service should consider RingCentral. It is powerful, easy to use, and comes with unlimited calling and text. Not only that, but you can take your business phone with you, thanks to its useful mobile app. The company even offers a seven-day free trial. Get started today.

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