Pay-As-You-Go vs Monthly Subscription: Business Phone Comparison

Here's a question nobody asks but everyone should: how many minutes of business calls do you actually make per month? Track it for a week. Multiply by four. I'll wait.

Most small business owners I've worked with guess "a lot" — then measure and find it's 100-300 minutes. At $0.02/minute, that's $2-6/month. They're paying RingCentral $30/month for the same outcome. That's $288/year wasted on unused capacity.

The subscription model makes sense for call centers doing 8 hours/day on the phone. For everyone else? It's a gym membership you barely use.

The Real Cost Comparison

Let's cut through the marketing. Here's what you actually pay:

Feature	Pay-As-You-Go	Subscription
Monthly cost (1 user)	$2-10 (usage-based)	$20-50 fixed
Annual commitment	None	Usually required
Setup/activation fees	$0	$0-500
Cost for 100 min/month	~$2	$20-50
Cost for 500 min/month	~$10	$20-50
Cost for 2000 min/month	~$40	$20-50
International calls	Pay per minute (transparent)	Often extra fees
Unused minutes	Don't pay for them	Lost (use it or lose it)
Scaling down	Instant, no penalty	Contract penalties
Advanced features	Basic (number, VM, forwarding)	Full suite available

The Break-Even Math

At what point does a subscription become cheaper than pay-as-you-go? Let's do the math:

Subscription cost: $25/month (typical mid-tier plan)

Pay-as-you-go rate: $0.02/minute

Break-even point: $25 ÷ $0.02 = 1,250 minutes/month

That's about 21 hours of calls per month. Are you on the phone 5+ hours per week?

For context: a typical small business makes 50-200 outbound calls per month, averaging 3-5 minutes each. That's 150-1000 minutes. Most fall well under the break-even point.

The Hidden Costs of Subscriptions

That "$20/month" advertised rate? Here's what actually hits your card:

Per-user pricing: $20/user × 3 team members = $60/month. Suddenly it's not $20.
Annual contracts: Cancel after 6 months? Pay the remaining 6 months anyway.
Feature add-ons: Call recording (+$5), toll-free number (+$5), international (+$10). The base plan is deliberately limited.
Setup fees: $100-500 for "onboarding" and number porting. Non-refundable.
Taxes and fees: Regulatory fees, E911 fees, number fees. Adds 15-25% to the bill.

A "$20/month" plan easily becomes $35-50 when everything's included. For a 3-person team with annual commitment, you're looking at $1,200-1,800/year minimum.

Provider Comparison (2026)

RingCentral

$20-45/user/mo

Contract: 1-year minimum

Full-featured, enterprise-focused. Overkill for most small businesses.

Grasshopper

$14-80/mo

Contract: Monthly available

Solo/small team focused. Limited features at lower tiers.

8x8

$24-44/user/mo

Contract: 1-year minimum

Video + voice bundle. You're paying for video whether you use it or not.

Vonage Business

$19.99-39.99/user/mo

Contract: 1-year minimum

Per-user pricing adds up fast with teams.

Google Voice

$10-30/user/mo

Contract: Monthly available

Requires Google Workspace ($6+/mo additional).

GlobCall

$0.02/min

Contract: None

Pay only for what you use. No monthly fee, no commitment.

When Subscriptions Make Sense

To be fair, subscriptions aren't always wrong. They make sense if:

You're a call center or sales team making 1000+ minutes/month per person.
You need advanced features like auto-attendants, CRM integrations, call queues, or team management.
You have 10+ employees who all need phone lines.
Predictable billing matters more than savings — some businesses prefer knowing the exact cost each month.

If that's you, go with a subscription. But if you're a solo founder, freelancer, small team, or any business where phones are a tool (not the whole business) — pay-as-you-go saves serious money.

A Real Case Study

Marcus runs a small accounting firm — just him and two part-time staff. He signed up for RingCentral when he started his practice. "$20/month seemed reasonable."

Actual bill: $89/month. Three users at $25 each, plus the "essentials" add-on package, plus regulatory fees. Annual commitment, paid upfront: $1,068.

His actual usage? About 180 minutes/month across all three lines. Tax season spikes to maybe 400 minutes. At pay-as-you-go rates, that's $3.60-8/month. He was paying 11-25x more than necessary.

He switched to a pay-as-you-go service. Annual savings: over $900. Same call quality. Same ability to reach clients. Fewer features he never used anyway.

The Contrarian Take

Business phone providers love selling "unlimited" plans. It sounds valuable — all-you-can-eat calling! But unlimited only benefits heavy users. Everyone else subsidizes them.

It's like paying $50/month for unlimited gym access when you go twice. The gym loves you. You're paying for capacity you don't use.

The more honest question: do you need unlimited, or do you need enough?

What to Do Now

Track your actual call minutes for one month. Most phones show this in settings.
Multiply by $0.02. That's your pay-as-you-go cost.
Compare to your current phone bill (include all fees and users).
If pay-as-you-go is cheaper, test it. GlobCall's first call is free.
Keep your old service active during the trial — switch when you're confident.

Frequently Asked Questions

What's the difference between pay-as-you-go and subscription business phones?

Pay-as-you-go charges per minute of actual usage (typically $0.02-0.05/min) with no monthly fee. Subscriptions charge a flat monthly rate ($20-50/user) regardless of usage, usually with 'unlimited' domestic calling.

Which is cheaper for a small business?

Pay-as-you-go is cheaper if you use less than 500-1000 minutes/month. Most solo businesses and small teams use 100-300 minutes monthly — pay-as-you-go saves 80-90% compared to subscriptions.

What are the hidden costs in subscription plans?

Setup fees ($100-500), required annual contracts, per-user pricing that adds up, add-on fees for features like call recording or international, and cancellation penalties. The '$20/month' often becomes $35-50 in practice.

Do pay-as-you-go services have business features?

Basic ones, yes — dedicated business number, voicemail, call forwarding. Advanced features like auto-attendants, CRM integrations, and team management are typically subscription-only. Ask yourself if you actually use those features.

What if my call volume varies month to month?

Pay-as-you-go is ideal for variable volume. You pay only for what you use. Subscriptions charge the same whether you make 10 calls or 1,000.

Is call quality different between the two?

No — both use VoIP technology. Call quality depends on your internet connection, not the billing model. A $0.02/min call sounds the same as a $50/month plan call.

Can I keep my existing business number?

Usually yes with subscriptions (number porting). Pay-as-you-go services vary — some support porting, others give you a new number. Check before signing up.

What about international calling?

Pay-as-you-go typically has transparent per-minute international rates. Subscriptions often charge extra for international or have limited country coverage. If you call abroad regularly, compare the actual rates.

Try pay-as-you-go, risk-free

No monthly fee. No contract. No commitment. Pay only for calls you make.

Get started — first call free