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Updated Apr 10, 2024

What Is a Softphone?

Learn how your business can use softphone technology to streamline communications.

Mark Fairlie
Mark Fairlie, Senior Analyst & Expert on Business Ownership
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After the widespread adoption of cell phones in the 2000s, softphones have become the next big step forward in telecommunications technology. Softphones allow users to make and receive calls via cell phones, landlines, computer terminals and tablets. 

We’ll explain more about softphones, how they work, how they differ from traditional phones, and which features may be most valuable for your business communication needs.

What is a softphone?

A softphone is a software application that’s used to make phone calls over the internet. You can install softphone apps and software on internet-connected devices — such as mobile phones, tablets and computers — so you and your team can make and receive calls without a traditional desk phone. 

Softphone communications technology is typically used in Voice over Internet Protocol (VoIP) business phone systems and requires a subscription with a VoIP service provider. Softphones are an increasingly popular tool in unified communications systems that deliver advanced calling features and flexibility for remote and in-office teams. 

Editor’s note: Looking for the right business phone system for your business? Fill out the below questionnaire to have our vendor partners contact you about your needs.

How do softphones work?

Softphones deliver voice, text and video communications over the web using a cloud-based VoIP service provider. The software works with most desktop computers, laptops, smartphones, tablets and other internet-connected devices that can support a microphone and speaker.

If you’re transitioning from a traditional phone service provider, you can usually port your existing business phone number to your new VoIP system.

FYIDid you know
To build a sales team that scales as you grow, it's important to implement a robust phone system that gives your remote team flexibility and control.

How do you install a softphone?

Installing a softphone application on your computer or mobile device is quick and straightforward. Once you’ve installed the software, users log in with their account credentials to access a full suite of calling features and tools. 

If you’re implementing a comprehensive softphone system for a large business, you must also address the following setup procedures:

  • Configure your call flows.
  • Set user groups.
  • Integrate the softphone system with one of the best CRM software platforms and other productivity tools.
  • Adjust the available features to fit your business’s needs.

Basic installation for making and receiving calls takes only a few minutes. However, your team’s size and the business’s call-routing complexity will dictate your installation time.

What equipment do you need for a softphone system?

To make and receive phone calls on an internet-connected device, you need a microphone and a speaker. You also may need a separate headset if the internet-connected device, such as a desktop computer, isn’t equipped with a speaker and microphone that are conducive to phone conversations. 

For most softphone users, a headset is the preferred equipment option for conducting phone calls clearly and professionally. Headsets help you avoid outside noise from the speaker and microphone, especially as many softphone providers now offer high-definition (HD) call clarity with their service.

It’s worth noting that when choosing a business phone system, you can use some desk phones in conjunction with your softphones. Manufacturers of various types of business phone systems produce IP phones that look and function much like traditional desk phones, but they’re connected via an Ethernet cable or Wi-Fi. 

With scheduling and call-routing features, you can decide which phones ring at any given time or specify device priority. For example, you can configure your IP phone to ring twice before alerting you on your softphone-enabled device on the third ring. This setup may help you avoid missed calls. For example, if front-office personnel are away from their desks, a manager can pick up on the third ring.

What software do you need for a softphone system?

Softphone software applications vary slightly among providers based on features and pricing. Many VoIP service providers have software for Windows and Mac, but Linux support is limited.

Most major VoIP service providers offer mobile apps for iOS and Android at no additional cost, allowing you to turn your existing smartphone into a softphone-capable device in minutes.

What technical considerations are there with softphones?

Softphones and VoIP call quality rely on an internet connection with enough bandwidth to support your communications. In fact, your internet connection is the most important factor because the signal quality directly affects your call quality. Any interruptions to your internet connection will lead to dropped calls. 

Large organizations that rely heavily on video conferencing may require business broadband with a fiber connection. However, most companies will handle VoIP communications effectively through any of the best business internet service providers.

TipBottom line
Tips for effective video conference calls include carefully planning an agenda, preparing and focusing participants, and creating a welcoming environment.

What are the benefits of a softphone?

There are many compelling reasons to move from traditional desk phones and PBX phone systems to VoIP services with softphones. Consider these benefits:

1. Softphones are cost-effective.

Softphone systems are most often implemented to save money in various ways. New companies that want to provide employees with a direct phone line, or even build a robust call center, don’t have to worry about the upfront purchase or lease of desk phone hardware that can cost hundreds of dollars for each handset. 

For any company with a “bring your own device” (BYOD) policy, softphone software and mobile apps function perfectly on most modern computers, smartphones and tablets. Although you can find very basic VoIP phone services for just a few dollars a month, most business-class providers and plans charge around $20 to $30 per user per month for a robust set of features and tools.

Did You Know?Did you know
If employees use their own devices, consider outlining a BYOD policy as part of your acceptable-use policy (AUP). For example, have your AUP clearly state that employee-monitoring efforts will apply to the use of employee-owned devices only during work hours.

2. Softphones are flexible. 

Many businesses allow employees to work remotely at least part of the time and need a  modern approach to communications. [Related article: Remote Work Best Practices]

Softphones serve this purpose well by allowing users to easily install the software on new computers and cell phones, letting them take calls, browse company directories and find other relevant customer information from anywhere at any time.

From an administrator’s perspective, softphone dashboards make it easy to modify call groups, change an individual’s settings, and add or remove team members on the fly. Administrators can easily set up or modify their phone systems with the many drag-and-drop call-flow builders that are available through VoIP service providers.

Softphones also support a wide range of devices and operating systems, allowing businesses and individuals to use existing internet-connected devices for their communication needs. Most VoIP service providers include free mobile apps for iOS and Android and support for Windows and Mac machines.

Bottom LineBottom line
Softphones help increase business productivity for remote teams by letting workers take calls and access customer information from anywhere.

3. Softphones help with unified communications.

The ability to manage all of your company’s communications through a single, easy-to-use system might be a softphone system’s most impactful benefit. 

Some VoIP service providers offer intelligent tools to automatically compile meeting transcripts with action items and notes into an easily digestible overview. These post-call summaries let employees focus on being present during a call while providing valuable data to improve future interactions. 

Other VoIP services provide complete customer relationship management (CRM) functionality and the option to integrate call data with many popular third-party CRM tools, allowing employees to maximize every customer interaction.

Softphones vs. traditional phones

Softphones and traditional phones serve very different purposes for most companies, so it’s not necessarily an issue of one technology versus another. In fact, many businesses use a combination of softphones and traditional phones throughout their organization. 

In many of these examples, businesses use VoIP-enabled IP phones in the office. At the same time, softphone software supports out-of-office communications without losing any data or features in the transition. 

One place you might expect to see a traditional phone in a softphone-dominant company is a conference room, where specialized hardware does a better job of picking up voices from across the room.

Here’s a quick comparison of softphones and traditional phones:

Softphones

Traditional phones

There are low upfront costs for headsets.

There are significant upfront costs for handsets.

A local phone number is not included based on your physical address.

A local phone number is included based on your physical address.

Call data is transmitted via the internet from anywhere with a connection.

Call data is transmitted via copper landlines from a fixed location.

An internet-connected device can be used with a mic and speaker as a phone to connect calls.

A traditional phone handset and landline are required to connect calls.

You get multiparty conferencing and video calling at no extra cost.

You get audio-only calling; conferencing may come with an additional fee.

You can still use current software, including CRM tools.

It’s a stand-alone phone system.

It can provide useful details and historical data on callers.

It provides basic caller identification information.

Top softphone features to consider

VoIP service providers offer a long list of standard and advanced softphone calling features to streamline organizations and improve collaboration through a unified communications platform.

Many softphone providers include these key features in their service:

  • Unlimited calls: Many softphone providers bundle unlimited U.S. and Canadian minutes into their subscriptions.
  • Local and toll-free numbers: Most softphone companies offer local and toll-free numbers. Some include these features in their subscriptions, while others charge extra for them.
  • Audio and video conferencing: Many softphone providers let you include multiple people in audio and video conference calls. This feature is also great for webinars where your sales team demonstrates your products and services.
  • Noise suppression: Softphones can provide excellent call quality. Some providers offer environmental noise suppression so both parties on a call can hear each other with much greater clarity.
  • Auto-attendant: Interactive voice response (IVR) systems greet callers and offer a range of options to help them reach the appropriate party. Auto-attendant features improve operational efficiency and boost customer satisfaction. 
  • Voicemail: Softphones can take messages if no one is available to handle a call. Many systems can transcribe and summarize customers’ messages and send them to you via email or text message for follow-up.
  • Advanced caller ID: When your softphone is tied to your CRM system, you can configure both systems to display a caller’s name, order history, past survey results, contact history and more. You’ll gain a competitive advantage by providing exceptionally personalized sales and service interactions.
  • Virtual fax: Many businesses still send faxes. You can send and receive faxes via your softphone and eliminate the need for physical fax machines. Many providers can forward virtual faxes to your email or softphone app.
  • Call routing: Softphones let you set up call routing to direct calls to various numbers depending on the caller ID, call type, number called, call times and more. 

These highly useful features illustrate just a fraction of the functionality softphones provide. High-level providers and plans include advanced features such as real-time voice analytics, post-call summaries, call recording and unlimited meetings. 

TipBottom line
Examine your business phone system at least once a year to evaluate its usability and your team's satisfaction. Consider upgrading your business phone system if you anticipate increased usage and the need for advanced features.

Best business phone systems with softphones

Many of the best business phone systems on the market provide softphone functionality. Here are some top providers to consider: 

Nextiva

Nextiva has three service levels, with prices that vary based on the number of users. For example, you’ll pay $23.95 per user per month for one to four subscribers and $17.95 per user per month for 100-plus subscribers on the Essential tier. Higher-level tiers cost a bit more and provide advanced features. 

The following features are available on all plans:

  • Unlimited U.S. and Canadian calling
  • Video calling
  • Video meetings
  • Free local and toll-free numbers
  • Toll-free minutes
  • Voicemail-to-email functionality
  • Microsoft Outlook and Google Contacts integration
  • 24/7 customer support
  • Unlimited internet faxing

Check out our comprehensive NextivaONE review for details on the service’s various plans.

RingCentral

RingCentral’s lowest service plan (Core) costs $20 per user per month when paid annually. 

All subscriptions include the following: 

  • Toll-free numbers
  • Toll-free minute and business SMS allocation 
  • Voicemail, including transcriptions and emails
  • Auto-attendant service
  • HD calls
  • End-to-end encryption
  • Call log reports
  • Quality-of-service (QOS) analytics

Read our in-depth RingCentral review to learn about available advanced features, including eight-digit site code extensions, call monitoring, hot desking and adoption analytics.

Ooma

Ooma’s plans range from $19.95 to $29.95 per user per month. 

All subscribers get these features:

  • Unlimited calling to the U.S. (including Puerto Rico), Canada and Mexico
  • Toll-free number with 500 inbound minutes
  • Auto-attendant
  • Music on hold and transfer
  • Call forwarding, parking and transfer
  • Company directory
  • Call logs
  • Virtual faxing

Read our detailed Ooma review to learn about advanced features, including text messaging, call records, call queuing, call blocking and voicemail transcription.

Zoom

Zoom stands out because its service plans are based on your calls and text messages, not on specific features. For example, the US & Canada Metered plan, which costs $10 per user per month, offers metered calling to those countries. The US & Canada Unlimited plan offers unlimited regional calling for $15 per user per month, while the Global Select option allows unlimited regional calling in 48 countries for $20 per user per month. 

All subscribers get these key features:

  • HD call quality
  • 24/7 support
  • Windows, Mac, Linux, iOS and Android apps
  • Toll-free numbers
  • Voicemail with transcription
  • Auto-attendant
  • Call monitoring, whispering, barging and takeover
  • Timed routing
  • Call recording
  • CRM integrations

Read our in-depth Zoom review for more details on pricing, features and functionality.

Vonage

As with Nextiva, user numbers dictate the prices for Vonage’s plans. Pricing ranges from $14.99 to $39.99 per user per month. The company regularly has 30 percent discounts, so watch for deals.  

All subscribers get these core functionalities:

Read our comprehensive review of Vonage for more information on advanced packages with auto-attendants, app integrations, analytics and reporting, and unlimited video meetings. 

Dialpad

Dialpad has a straightforward pricing structure. The Standard plan costs $15 per month, and the Pro plan is $25 per month. (Enterprises can negotiate custom pricing.) 

All plans include the following:

  • Unlimited calling
  • SMS, MMS and team messaging
  • AI-powered call and voicemail transcriptions and AI meetings
  • Integrations with Google Workspace and Microsoft 365
  • Analytics and reporting
  • HIPAA compliance and BAA compliance

See our in-depth review of Dialpad for more on features such as ring groups, priority agent support, integrations and more. 

GoTo Connect

With GoTo Connect, you can choose from the Basic plan ($27) and the Standard plan ($32).  

All subscribers get access to the following features:

  • Local, toll-free and vanity numbers
  • Call routing
  • Call forwarding
  • Auto-attendant
  • Ring groups
  • Call queues
  • Team messaging
  • Audio conferencing

Read our updated review of GoTo Connect for more on how its customers benefit from hot desking, call recording, real-time analytics and toll-free minutes. 

8×8

8×8 offers an array of service options that cater to a wide variety of business needs. Prices range from $28 to $140 per user per month (billed annually). 

All users can access the following features:

  • Time-limited media storage
  • Unlimited faxing
  • Voicemail with transcription
  • 24/7 customer support
  • Unmetered phone calls to the U.S. and Canada (plus 12 other countries on higher tiers)
  • Hot desking
  • Auto-attendant
  • HD call quality
  • Call queues
  • HD video conferencing

Our updated review of 8×8 goes into more detail on advanced features, including call barging, monitoring and whispering; omnichannel routing; skills-based routing; and post-call surveys.

Jeff Hale contributed to this article. 

Mark Fairlie
Mark Fairlie, Senior Analyst & Expert on Business Ownership
Mark Fairlie brings decades of expertise in telecommunications and telemarketing to the forefront as the former business owner of a direct marketing company. Also well-versed in a variety of other B2B topics, such as taxation, investments and cybersecurity, he now advises fellow entrepreneurs on the best business practices. With a background in advertising and sales, Fairlie made his mark as the former co-owner of Meridian Delta, which saw a successful transition of ownership in 2015. Through this journey, Fairlie gained invaluable hands-on experience in everything from founding a business to expanding and selling it. Since then, Fairlie has embarked on new ventures, launching a second marketing company and establishing a thriving sole proprietorship.
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