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Business Phone Systems: What are the Hidden Fees?

Last updated: 31 Oct 2023

Business phone systems have emerged as a crucial element in the operational framework of businesses. These systems enable seamless communication, foster collaboration, and drive productivity. However, as beneficial as they may be, they often come with hidden costs that can surprise unprepared businesses. In this blog, we’ll delve into these hidden fees and share expert advice on how to avoid them.

Delving into Business Phone Systems

Business phone systems are advanced communication networks designed for businesses to facilitate internal and external communication. These systems are pivotal in ensuring efficient communication flow and driving productivity and collaboration. Whether connecting team members across different departments or engaging with customers worldwide, business phone systems have got it covered. 

There are several business phone systems, each with unique features, advantages, and drawbacks. Let’s explore the three most common types: 

Private Branch Exchange (PBX) 

PBX is a private telephone network used within a company. PBX systems can be hardware-based, requiring equipment installed on-site or hosted in the cloud, reducing the need for physical infrastructure. 

Voice Over Internet Protocol (VoIP) 

VoIP technology transforms your voice into digital signals that travel over the Internet. VoIP empowers businesses to conduct calls from a dedicated VoIP phone, a computer, or any other data-enabled device. This versatility, scalability, and cost-effectiveness make VoIP an optimal solution for companies looking to enhance their communication capabilities without incurring high costs. 

Cloud-Based Phone Systems 

Cloud-based phone systems, or hosted phone systems, are a subset of VoIP technology. The VoIP provider handles all routing services instead of relying on in-house resources. These systems require minimal hardware and are maintained off-site by the service provider. They offer scalability, flexibility, and advanced features, making them a popular choice for businesses seeking robust communication solutions without the hassle of maintenance and upgrades. 

Unveiling the Hidden Fees in Business Phone Systems

Navigating the costs of business phone systems can be a daunting task. Besides the upfront costs, hidden fees can substantially increase the total cost. Let’s unveil these hidden charges: 

Setup Fees 

Setup fees are the initial costs of installing and configuring your business phone system. These charges primarily cover the labor required for installation and the configuration of your system to meet your specific business needs. These fees can range from a hundred to several thousand dollars depending on the number of users and the complexity of the system. 

Conduct thorough market research and choose a provider that offers competitive pricing to avoid unnecessary setup costs. Some providers may also offer discounted or waived setup fees for promotional deals. 

Maintenance Fees 

Maintenance fees are ongoing costs necessary to keep your phone system in optimal working condition. These fees typically include costs for software updates, hardware replacements, and technical support. Depending on the provider and the complexity of your system, maintenance fees can vary, but they often fall into the range of 15-20% of the original purchase price per year. 

One way to mitigate these costs is by opting for providers that offer inclusive maintenance packages. Alternatively, choosing a cloud-based or VoIP system can reduce these expenses as these systems require less physical maintenance. 

Long Distance Fees 

Long-distance fees are additional charges incurred when making calls outside your local area or country. These charges can quickly add up, especially for companies with clients or partners overseas. Rates vary based on the call’s destination but can range from a few cents to over a dollar per minute. 

Businesses can leverage VoIP technology to bypass these fees. VoIP uses Internet connectivity to make calls, which significantly reduces long-distance costs. Some VoIP providers offer unlimited international calling plans at a fixed monthly rate. 

Equipment Fees 

Equipment fees refer to the cost of physical hardware such as phones, routers, and servers required for your phone system. These charges can be substantial, particularly for traditional PBX systems that require significant on-site equipment.
Businesses can opt for cloud-based phone systems that require minimal physical equipment to evade these charges. Most system components are hosted in the cloud, reducing the need for costly hardware. Additionally, many VoIP providers offer IP phones as part of their service package, further reducing equipment costs. 

Understanding these hidden fees can help businesses budget more accurately for their phone systems and avoid unexpected costs.

Expert Tips to Avoid Hidden Fees

While hidden fees can pose a significant challenge, there are strategies businesses can employ to avoid or minimize these costs. Here are some expert tips: 

Read Contracts Carefully 

One of the most effective ways to avoid unexpected costs is by thoroughly reading and understanding your service contract before signing. These contracts often contain detailed information about charges that may not be explicitly mentioned during sales discussions. If anything is unclear, don’t hesitate to ask for clarification. Having a legal professional review the contract is also helpful to ensure you fully understand the terms. 

Negotiate Terms 

Contrary to what many believe, the terms of service contracts are often negotiable. Don’t shy away from negotiating with your provider to secure better terms. Such negotiations could involve waiving certain fees, reducing rates, or adding additional services at no extra cost. Remember, the goal of any negotiation should be to arrive at a mutually beneficial agreement. 

Opt for Bundled Services 

Some providers offer bundled services that combine several services into one package at a discounted rate. These bundled packages can include features like call forwarding, auto-attendant, voicemail, and more. Opting for such bundled services can provide substantial savings and simplify invoicing by consolidating multiple services into one bill. 

Plan for Growth 

When choosing a phone system, consider your business’s future growth. Opting for a scalable solution can save costs in the long run as it allows you to add or remove lines and services as needed without incurring hefty upgrade or downgrade fees. 

The Impact of Hidden Fees on Businesses

Hidden fees can significantly inflate the cost of business phone systems that impacts a business’s bottom line. These unexpected costs can strain budgets and divert funds from otheimportant areas. For instance, high setup fees can deter businesses from upgrading their systems, while recurrent maintenance fees can lead to higher operational costs over time.

How VoIP Can Help Save Costs and Boost Productivity

VoIP technology has revolutionized business communication by offering cost-effective, feature-rich solutions. It eliminates the need for traditional telephone lines, reducing setup and maintenance costs. With VoIP, businesses can make long-distance calls at a fraction of the cost, resulting in significant savings. 
Beyond cost savings, VoIP systems enhance productivity by enabling features like call forwarding, voicemail-to-email, and video conferencing. These features streamline communication, promote collaboration, and drive business growth.

Why Our VoIP Services Stand Out

Our expertise in VoIP technology positions us to help businesses navigate the complexities of business phone systems. We pride ourselves on our transparent pricing, ensuring no hidden fees surprise you down the line. Our highly committed customer service team is readily available to provide assistance and address any inquiries or concerns, ensuring a seamless and effortless experience for you.  


With BlackPoint IT, you can rest assured of a business phone system that boosts communication efficiency while controlling costs. Ready to explore a transparent, cost-effective business phone solution? Contact us today for a free consultation or audit of your current phone system. Your efficient communication journey starts here!