The complete guide to IP phones for business

It’s no secret that the plain old telephone service, otherwise known as POTS, is seeing a decline. Known as the copper sunset, new technology is replacing the old copper wire telephone service, and the FCC is hurrying things along. In March of 2025, the FCC issued changes to how POTS networks are regulated, taking them even closer to retirement. If you’re a business still operating on a POTS network, it’s time to make a move to newer technology.

Enter IP phone service and IP phones. Rather than using a landline or a public Wi-Fi network to make calls, IP phones connect to a private internet or local area network, making your calls easy, cost-effective and giving you power and control over your data. Keep reading to learn more about what an internet phone is, how it works and its advantages.

What is an IP phone?

An IP phone is a phone system that works over the internet, also called an internet phone or an internet protocol phone. It converts audio calls and data into digital signals that travel through a VoIP system and land on a local or private network where the listener can hear them. With today’s technological advances, an IP phone system is much more compatible with software, offering greater flexibility and control.

Types of IP phones

There are several types of IP phone systems that your business will find useful, including:

• Desk IP phones
• Cordless IP phones
• Softphones (mobile apps instead of a physical phone)
• Conference IP phones

How does an IP phone work?

Unlike traditional phones, internet phones work by sending calls over the internet, not a copper landline or a cellular network. They work by compressing voice signals from the phone and converting them into digital signals. These digital signals then travel through the VoIP network and into a private or local area network. On the receiving end, files are decompressed and changed back into normal-sounding audio for the listener.

Key features of IP phones

IP phones have several distinguishing features. Together, they make IP phones far more than simple calling tools. With these features, they function as a complete communication network for your business. The following are key features to look for in an IP phone:

• HD call quality that reduces background noise and static, producing clearer call sounds.
• Auto-attendant and call routing, such as a built-in virtual receptionist that answers and directs calls, creating a professional first impression and saving staff time.
• Voicemail-to-email is the ability to translate voice messages to email, allowing for organized communication and fewer missed messages.
• Video and conference calling takes away the need for a third-party tool. IP phone systems support multi-person audio and video calling.
• Mobile app or softphone access that enables your smartphone to act as an office extension while keeping your personal phone private.
• Easy integration with business tools keeps teams connected by integrating with CRM systems and collaboration tools, while logging and tracking customer interactions.

The IP phone difference

Internet protocol phones use technology that works over the internet, not a landline or Wi-Fi. The technology is both cheaper and more reliable. Take a look.

IP phone vs. a landline

An IP phone system leverages IP (Internet Protocol) technology and is used within a single location or various locations on a private data network. IP phones are often used in larger office buildings, manufacturing plants or even small businesses. Rather than connecting to traditional copper wires and requiring an expensive phone service plan, IP phones leverage existing internet connections to place and receive calls, often cutting your phone bill in half.

IP phone vs. a Wi-Fi phone

IP phone service uses Internet Protocol (IP) technology to make calls through a VoIP phone number within private data networks. By comparison, Wi-Fi phones rely on the public internet (like Wi-Fi hotspots) to transmit voice signals. Because these networks are public, Wi-Fi phone users can’t regulate service quality, leading to echoing, dropped calls and more. By completing calls over a private network, IP phones are considered more secure and stable than Wi-Fi phones.

Benefits of an IP phone

Ultimately, IP phones combine flexibility, reliability and advanced technology — all while lowering costs and simplifying management compared to legacy phone systems. Here are the benefits of an IP phone:

• Flexible for hybrid and remote teams – Using an IP phone service, employees can use desk phones, mobile apps and softphones to make and take calls from any work location. Communication remains professional with a caller ID that displays the business number.
• Can be used anywhere – IP phones will work in any location where they can be accessed by the internet. For global companies, this means employees can connect to their phones even while traveling abroad.
• Same look and feel – IP phones are similar to their analog counterparts, just with more features. As a result, users won’t need extensive training to get accustomed to IP phones.
• Cost-savings – IP phone service with companies such as Ooma is a flat fee that covers local, long-distance and international calling. Since it operates on a cloud network, it doesn’t require expensive hardware and IT costs are reduced.
• Unlimited simultaneous calls – Cloud phone systems allow for multiple calls to take place at once, meaning your services will no longer be limited by the number of rollover lines, physical phones or people available to answer the calls.
• Easy scaling – Since IP systems like those available from Ooma are plug-and-play, you can add and activate new phones and users in minutes – no rewiring required.
• Streamlined communication – With an IP phone service like Ooma Office, all communication is handled by a single provider, combining voice, video, text and fax on a single platform that keeps teams connected.

Three IP phones to check out right now

Selecting the right IP phone can reduce your phone bill, enhance call quality and improve your customers’ experience. Of course, the trick is to pick the right one. Below, we list our top IP phones for business to pair with our IP phone service that will benefit both large and small businesses.

Grandstream GRP 2602

For new or small businesses, the Grandstream GRP 2602 is an excellent choice. It features a two-line phone with five-way voice conferencing and covers all the basic desktop phone needs. It features great call clarity with full HD calling on both the handset and base speaker.

Grandstream GRP 2624

The ultimate business phone for enterprises with high call volume, the Grandstream GRP 2642 has eight lines and 32 programmable keys. It has all the advanced features needed to support and maximize productivity.

Yealink CP925

Perfect for small to medium conference rooms, the Yealink CP925 IP phone has echo-canceling technology for clear, in-person-like call quality. Intuitive and easy to use, you can’t go wrong with this in your conference room.

IP phones: The future of business calls

Making the switch from traditional phone lines to IP phone service and phones is more than just a tech upgrade — it’s a smart business move that enables your business to be more reliable, efficient and cost-effective. And Ooma Office can help. Bringing your team together on a single platform and providing the IP phones to do it, Ooma offers a VoIP cloud-based solution for small businesses. Perks include clear call quality, easy setup, virtual tools and an intuitive mobile app. Make the switch today for a professional, connected and affordable net