Quick Verdict
Pros
- VoIP is significantly cheaper for most businesses, especially those with high call volumes
- Features like auto attendant, ring groups, and call recording are included in most hosted plans
- Number flexibility: 1300, geographic, and international numbers all supported
- Scale up or down without hardware changes
- Works on any internet connection including NBN
Cons
- Dependent on internet connection quality. FTTN NBN can cause quality issues
- Requires power at the premises (desk phones need PoE or power adapters)
- Emergency services (000) location accuracy can be less precise than PSTN
- Setup and number porting requires some planning time
The PSTN Copper Shutdown: Why This Decision Is Largely Made
Australia's Public Switched Telephone Network (PSTN) has been progressively decommissioned as NBN connectivity is extended to each area. When your premises is connected to the NBN, Telstra and other providers begin the process of retiring the legacy copper services attached to that address. In most cases, businesses are given a migration window of 18 months from NBN availability to move their services.If your business is in an NBN-served area and you are still on a traditional landline, you may already be operating on a service that is scheduled for shutdown. The practical implication is that most Australian businesses choosing between VoIP and traditional phone are not comparing equal alternatives. Traditional PSTN landline is not available in most NBN areas. The real choice is between different VoIP approaches: hosted PBX, on-premise PBX with SIP trunking, or unified communications platforms.Cost Comparison
| Monthly line rental (per seat) | Local calls | National calls | Mobile calls | PBX hardware | Maintenance | Adding a line | |
|---|---|---|---|---|---|---|---|
| Traditional PSTN (legacy) | $40-80/month | Often included or flagfalling | Flagfall + per-minute | Often 20-40c/min | $5,000-50,000+ upfront | On-site technician required | $100+ installation + new hardware |
| VoIP Hosted PBX | $20-50/month | Usually included or per-minute | Usually included or low per-minute | Often 8-15c/min or included | Nil (hosted) or hardware only | Provider handles remotely | Provision in the portal, ship a phone |
Call Quality: Honest Assessment
Traditional PSTN calls have consistent, predictable quality because the circuit is dedicated to your call. VoIP call quality depends on your internet connection and network configuration. On a well-configured FTTP or FTTC NBN connection, modern VoIP with a quality codec (G.722 wideband) sounds better than legacy PSTN. The issue is that not all Australian businesses have ideal NBN connectivity.FTTN (Fibre to the Node) connections in particular can introduce variable latency and packet loss during peak hours, which directly affects call quality. Businesses on FTTN who need guaranteed call quality should either request an upgrade to a higher NBN tier, use QoS settings to prioritise voice traffic on their router, or factor call quality risk into their hosted PBX choice. Our VoIP call quality guide covers this in detail.Features Comparison
| Auto attendant (press 1 for sales) | Ring groups | Call recording | Voicemail to email | Mobile app for desk phone calls | 1300 / 1800 numbers | Multiple locations, one phone system | Work from home / remote staff | |
|---|---|---|---|---|---|---|---|---|
| Traditional PSTN | Requires expensive hardware | Hardware-dependent | Expensive add-on or impossible | Rare | Not possible | Separate service, additional cost | Complex and expensive | Not possible without hardware |
| VoIP Hosted PBX | Included in most plans | Included | Included in most plans | Standard | Standard (softphone) | Usually included in plan | Simple. All cloud-based | Any internet connection |
Emergency Services (000) Considerations
ⓘ
Unlike traditional landlines, VoIP systems do not automatically provide precise location information to emergency services when you dial 000. Most hosted PBX providers require you to register a physical location address for each number. Ensure your provider supports Emergency Call Location Registration and that you have registered the correct address for each line.
Our Recommendation
For the overwhelming majority of Australian businesses, a hosted VoIP phone system is the right choice. The cost savings are substantial, the features significantly exceed legacy PSTN, and the infrastructure is more aligned with how modern Australian businesses operate: distributed, internet-connected, and increasingly remote-capable. The only scenarios where we would counsel caution are businesses on poor-quality FTTN connections in areas unlikely to receive infrastructure upgrades, or very small sole-trader operations where simplicity and zero administration overhead justify keeping a basic plan if one is still available.If you are ready to move to VoIP and are not sure which system suits your business, see our best VoIP phone system guide or use our recommendation service below.How We Compared
Is VoIP cheaper than a traditional business phone line in Australia?
Yes, in almost all cases. Hosted VoIP phone systems cost between $20 and $50 per seat per month in Australia, compared to $40 to $80 per month for traditional PSTN business lines. Call rates are typically lower as well, particularly for national and mobile calls. The savings are most significant for businesses with multiple lines or high call volumes.
Will the NBN affect my traditional phone line?
Yes. When your premises receives NBN connectivity, your existing copper-based PSTN services begin a phase-out process. Telstra and other carriers notify customers of the transition timeline. In NBN-served areas, you will eventually need to migrate all voice services to an IP-based solution. Most businesses in NBN-served areas can no longer order new traditional PSTN business lines.
What if my internet goes down. Can I still receive calls on VoIP?
During an internet outage, calls to your VoIP numbers will not reach your desk phones or softphones. Most hosted PBX providers offer automatic failover: if the system cannot reach your phones, calls are diverted to a nominated mobile number or voicemail. This means your callers can still reach you, but you will need a mobile connection to answer. Some providers offer a SIM-based failover device for critical lines.
Can I keep my existing business phone number when switching to VoIP?
Yes. Australian geographic numbers (02, 03, 07, 08), 1300 numbers, and 1800 numbers can all be ported to a VoIP provider. The porting process typically takes 5 to 20 business days. During porting, your existing service remains active until the port completes. Most hosted PBX providers manage the porting process on your behalf.
Ready to Move to VoIP?
Get a Recommendation