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VoIP Explained

What Is VoIP?

VoIP is the acronym for Voice Over Internet Protocol service. Some of the most popular companies offering consumer and business VoIP telephony are Covad, Skype, Vonage and Yahoo, though dozens of others are leaping onto the phone VoIP bandwagon.

How does VoIP work?
Quite simply, VoIP service turns analog audio signals into digital data that's transmitted over the Internet to let you make local and long distance calls. There are three ways to do this:

  1. ATA - The most popular way to VoIP uses your own cell or landline phone, an ATA (analog telephone adaptor) from your broadband company and an Internet connection.
  2. IP Phones -- These special phones use an RJ-45 Ethernet connector that's patched into your router and include all the hardware and software you need.
  3. Computer-to-computer -- This easiest way to VoIP lets you avoid paying for long distance calls, by using special VoIP telephony software, a microphone, speakers and a sound card with your broadband Internet connection.

How many people use phone VoIP?
At the beginning of 2005, about 1.3 million Americans were using VoIP. By the end of 2006, Forrester Research Group predicts there will be more than 5 million users in the US.

What's the difference between VoIP and telephony?
A VoIP phone connects to an Ethernet port and a TCP/IP computer network, while telephony encompasses the general use of equipment to provide voice communications. So while VoIP and telephony help you make calls over the Internet, they use different equipment.

What are the benefits of VoIP for business?
Using VoIP saves you money. Big time. How? First, with VoIP service, you can actually make free local calls by bypassing your regular phone company. (They're not too crazy about this, but they'll get over it.) You pay a flat monthly fee, depending on how many minutes you want to use. Fees can range roughly from $15 for a limited number of minutes per month to $80 per month for unlimited plans. Second, VoIP lets you call international cities like London, Hong Kong, Tokyo, Beijing, Tel Aviv, Barcelona and Buenos Aires for far less than your current cost with a long-distance carrier. So you can call for as little as 3 to 6¢ per minute to speak with family, friends and colleagues around the world. Imagine how much that would cost with a traditional phone company.

Other benefits of VoIP telephony include:

  • A long list of phone service features, such as Caller ID, call waiting, call transfer, return call, three-way calling and more - included with your flat monthly fee,
  • Using a cell phone instead of a landline.
  • Eliminating multiple phone bills for your landline and Internet service.
  • Increasing employee productivity.
  • Enjoying a higher quality of service.
  • Boosting enterprise efficiency with more phone features.
  • Simplifying administration of your phone system.

Sources

  1. http://computer.howstuffworks.com/ip-telephony.htm
  2. http://www.tomatovine.com/
  3. http://voip.covad.com/products/voip/voip.shtml
  4. http://computer.howstuffworks.com/ip-telephony3.htm
  5. http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2006/03/28/BUGN2HUSSI1.DTL&hw=jajah&sn=001&sc=1000
  6. http://computer.howstuffworks.com/ip-telephony1.htm
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