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October 09, 2021

Is ditching your cell's voice plan for VoIP calling smart?

Normally, when we bitch about cell phone prices in this space, it’s a tale of data rates and how telecom carriers treat us like the Sisters did Andy for the first 45 minutes of The Shawshank Redemption.

But there’s a new trend catching on that flips our gripes on their head.

Some cell phone users in urban areas are actually ditching voice plans on their cells, choosing instead to survive on data packages and the exclusive use of Voice over Internet Protocol (VoIP) calling.

Sounds savvy, but is it a good idea?

Let’s start with the basics here. VoIP calling with your cell phone works just as it would with your home Internet connection, allowing you to place calls over a Wi-Fi service even when there is no cell signal (for my money, the best feature, especially if you live where there’s poor coverage).

While many carriers don’t allow it, some – like AT&T in the States – will let your phone connect to a VoIP program over a 3G network, which is readily-available in most urban centres.

So, essentially, whenever you’re not in a Wi-Fi hotspot, you can still use your phone normally over your carrier’s data network.

Admittedly, it seems like a sensible move on the surface, but that’s before we get to the cons.

And those come in bunches. For starters, dropping your voice plan may make you susceptible to an early termination fee, or as the carriers like to call it, the ‘Customers, We Hope You Have A Safe Word’ charge. That can ring you up to $400.

Then there is the issue of the per-call fee you now face without a voice plan: 40 cents / minute (with AT&T). This won’t be a regular occurrence, but there are a few caveats that may make it so.

Any call you make outside of a city, for example, will now be subject to that rate because 3G isn’t everywhere yet. Also, 911 calls aren’t allowed on the majority of VoIP programs; they simply won’t connect. So while you won’t exactly be chatting up the emergency response operator all the time, consider the safety element here.

The big deal, though, is this: on many VoIP programs (the one I tested for this article included) you can only make and receive calls up to five minutes in length. You have to pay extra to connect for longer, which – uh – sucks.

These are the drawbacks.

But who knows what happens with this going forward? Carriers are good at money-sucking, so if this turns to be a legitimate movement I’d imagine they would provide a VoIP calling package and find a way to charge for it.

Though I’d hope the above problems would be fixed. For now, this seems like a stay-away for smartphone users.

By Jason Buckland, MSN Money



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Gordon PowersGordon Powers

A long-time fund company executive, Gordon Powers now heads up the Affinity Group, a financial services consulting firm. Gordon was a personal finance columnist for the Globe & Mail for many years, has taught retirement planning...

James HaversJames Havers

James is the senior editor of MSN Money living in Toronto. He has worked for the Nikkei Shimbun (Tokyo),,, Canadian Business and other publications. Havers turned to journalism after teaching overseas.

Jason BucklandJason Buckland

The modern-day MC Hammer of money, Jason can often be seen spending cash that isn’t his with the efficiency of a Wilt Chamberlain first date. After cutting his teeth as a reporter for the Toronto Sun, he joined the MSN Money team with...