We didn’t always have smartphones and the internet. Back in the day, POTS lines were the real deal until the advent of the first smartphone. And while POTS is not entirely out of existence, modern alternatives have taken over. This article discusses what a POTS line is, how it works, the cost, and its impact on your business communication. 

What is a POTS Line?

A POTS line is an analog voice transmission phone system that facilitates communication over copper wires. This phone line technology originates from the standard voice-grade telephone system invented by Alexander Graham Bell. Homes and businesses across the world have used it since the 1880s.

How Does a POTS Line Work?

Over the years, how copper wires and POTS work has largely remained the same. However, here’s a breakdown of the process: 

You dial a number on your handset and speak. The POTS telephone lines convert the audio into electrical signals and direct them to a drop cable connected to a separate terminal. These electrical signals go to a central phone company office via telephone line.

At the main office, automated switches decode and determine the destination of the electrical signals. The electrical signals go to either of two locations depending on where the call is being routed to. Some go to a tandem office, while others go to a central office closer to the call’s destination.

Switches within the main office detect any incoming electrical signals and route to the specified terminal. Finally, calls reach local lines and connect to the network of the specified destination. The handset translates the electrical signals into sound waves enabling us to hear the other side.

Circuit Switching

Circuit switching was usually done manually by someone in the central office with a switchboard. The person’s work was to plug copper lines into a patch panel within the switchboard. This makes call connection possible between two people. 

If it requires more than one exchange, another person joins to plug the caller and receiver’s copper lines into the same exchange wire, also known as a trunk. Long-distance calls were often costly as everything was manual, and the longer the call, the longer the copper wire needed. 

Circuit switching has its series of updates from the first Strowger Switch to the invention of the crossbar, which was said to be more efficient but bulky and not cost-effective. These gave way to transistors and modems.


The transistor opened the electronic exchange era, which slowly paved the way for the digital network. A copper line is full-duplex i.e., and it is bi-directional and capable of carrying human voice both ways simultaneously. However, it cannot transmit digital signals as its frequency band is limited to 300 – 3400 Hz.

Currently, phone lines have been upgraded and can carry digital signals in the form of “packets.” The packet-based technology is the underlying network to transmit voice (and data) messages independently through the switches.


Modems help POTS implement digital technology without revamping the phone system. There are two types: DSL and ISDN. With Digital Subscriber Line (DSL), a transceiver connects to a personal computer and uses the local phone network to reach an ISP network. The data is transmitted over the copper lines of the telephone system. Several small businesses use this for many users to access the internet. 

Integrated Services Digital Network (ISDN) is the same as DSL, except calls connect faster and with higher quality. It also offers other features, such as call queues, on-hold music, and call routing.

How Much Does POTS Line Cost?

Overall, the cost of maintaining a POTS line is much higher, but there are situations where it costs less to implement. In some rural areas without internet coverage, the old copper lines are still the primary source of services. They can be used to reach 911 emergency services and Internet DSL connections, and for some – dial-up services remain the only option. 

As of December 2016, 45.9% of American households still used a POTS phone line. 39% of US homes still had a landline connection in 2019, down from 68% in 2010. A decade earlier, this was at 96%. 

Concerning business landline costs, it lies on many factors. Depending on the size of the business and the additional features you require, your costs can add up quickly. It also comes with hardware installation and upgrades costs which could run in thousands of dollars.

POTS Line vs. VoIP

Below is a feature-by-feature comparison between POTS line and VoIP

FeaturePOTS LineVoIP
Connectivity TypeCircuit switching on a dedicated telephone line.Internet using packet switching.
BandwidthRequires 64Kbps in each direction; bandwidth is reserved in advance.Requires 10Kbps in each direction, utilizing bandwidth as needed.
ScalabilityUpgrades by purchasing more hardware and dedicated linesUpgrades usually require software updates only.
Uptime Service doesn’t need electricity to function and remains available during a power outage.Service becomes unavailable when there is no power or Internet connectivity.
Call Waiting/ Call Forwarding/ Call TransferAvailable for payment separately.Are standard packages in Business VoIP solutions
Local and international callsNo free calling and international calls are high. Cost is based on distance and timeFree VoIP-to-VoIP calling (local and international). Cost is not based on distance and time.


With POTS, besides the high setup and installation fees, there is added cost for literally any added feature such as call recording, future phone lines, and more. Compared to cloud-based telephony systems, POTS is pricey. With VoIP, you pay on a subscription basis. You can upgrade, downgrade or cancel at any time depending on your needs.


VoIP offers many advanced features like auto attendants, HD calling, dynamic call forwarding, VoIP softphones, and team messaging that make remote working possible and seamless. However, POTS lines do not come with these features and benefits. 


Scalability is crucial for small and medium-sized businesses whose needs change regularly and need to handle increasing demands without negatively impacting performance and efficiency. POTS are limited to the number of lines connected, and you will need to upgrade your hardware if you plan to add more. However, VoIP allows for an unlimited number of lines without unnecessary costs or downtime.

Final Thoughts on POTS Lines 

Traditional landlines are now a thing of the past, and VoIP is here to stay. This is why modern businesses are ditching POTS lines for cloud-based solutions with advanced calling features to run their business effectively. Here at ULTATEL, we have a deep understanding of small-scale communication needs. Enjoy numerous benefits and advanced features with our phone system for small businesses.