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How to Choose a Long-Distance Plan

Being able to connect with customers, investors and employees in far-flung locations is important for business but there are more choices in telecom than ever.
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Deciding on the right long-distance calling plan is as important for your business as finding a good Internet service provider or determining the best express mail service. Technology has opened up more options than ever before.

Here are six tips for finding the best phone plan for your business:

Tip No. 1: Go rate shopping each year

Phone company rates aren't static. More importantly, the needs of your company will change over time. 'It would also be wise to check rates again at least once each year,' says Stephanie Chandler, founder of BusinessInfoGuide.com, a Sacramento, Calif. based newsletter and website for entrepreneurs and start-ups.  'You can potentially save a lot of money by shopping for the best long distance plan on an annual basis.'

Tip No. 2: Consider a cell phone-based plan

If you have a highly-mobile business or need phones for only a few employees, experts recommend considering cell phones. Furthermore, nearly all cell phone carriers charge the same for local and long-distance calls. 'Since cell service gets more reliable every day and most include long distance, this can be a viable option for many small businesses,' Chandler says.

There are a few big disadvantages. One, there are limited minutes during normal business hours, which are 7 a.m. to 9 p.m. weekdays for most cell phone carriers. Two, a basic phone line may still need to be installed and maintained for Internet and fax usage (though a local-only line can be significantly cheaper). Three, make sure the carrier's coverage is good in your office.

Tip No. 3: Consider Internet-based calling

Vonage and other new phone companies now offer long-distance calling via Voice over Internet Protocol (VoIP), which allows your business to call people for less by routing communications through the computer. Monthly fees are around $40, and often include a fax line, call forwarding and caller ID. Unfortunately, the service requires a special phone adapter, broadband connection and, most bothersome, no Web surfing while a call is being made (splitting the modem feed would be required).

VoIP is fairly new technology, but AT&T and Qwest are now offering packages. 'If you want to tiptoe in, try a company with a money-back guarantee,' recommends Kim Komando, Microsoft Online's workplace technology expert. 'And make sure you understand the terms before taking the plunge.'

Tip No. 4: Join organizations for group discounts

The Small Business Association, the National Business Association, and other organizations often offer deep discounts on long-distance services. Networking with other businesses is always a good idea, but weigh the potential savings against the cost of membership.

Tip No. 5: Separate local and long-distance services

While packages can save money, experts say separating local and long-distance services may save additional money. More creative types can use a flat-rate cell phone for long distance and a traditional line for local calls. Also, provided you have the patience to dial some extra numbers, using a phone card will give a cheaper per-minute average. 'A prepaid long-distance card can cut costs if you don't make many long-distance landline calls,' according to Consumer Reports. The publication estimates it can save businesses a few hundred dollars annually.

Tip No. 6: Ask for estimate based on usage

Measure or calculate your likely call usage. Ask potential providers for a rough estimate of your potential monthly bill. 'If they can't answer this question in advance, then choose another provider,' Chandler says.

Last updated: Dec 1, 2006




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