Perhaps a not well-known fact is that VoIP started in the early days of the information superhighway, how the internet was known in the ’90s. In 1996 a startup company called Vocaltec launched the Internet Phone; introducing us to the VoIP era and Home/Office Phone alternative. Sure, the service wasn’t like it is today but there’s a long history behind in its more than twenty years of existence.
Yesterday’s and Today’s Future
Fast-forward to the 2000s and a major development that started in 2004 was the introduction of mass-market VoIP services that utilize existing cable broadband Internet access. This allows subscribers to place and receives telephone calls in much the same manner as they would via the public switched telephone network (PSTN). Full-service VoIP phone companies provide inbound and outbound service with Direct Inbound Dialing. Many offer unlimited domestic calling for a flat monthly subscription fee. This sometimes includes international calls to certain countries. Phone calls between subscribers of the same provider are usually free when flat-fee service is not available. A VoIP analog telephone adapter (ATA) is necessary to connect to a VoIP service provider.
magicJack advanced residential VoIP
If you are wondering what is Vocaltec doing now… look at the award-winning magicJack; launched in the market in 2008 and with over 10-million units sold to date worldwide. It’s estimated more than 1-million magicJack units have been sold in Canada.
Dedicated VoIP phones connect directly to the IP network using technologies such as wired Ethernet or wireless Wi-Fi. They are typically designed in the style of traditional digital business telephones.
An analog telephone adapter (ATA) is a device that connects to the network and implements the electronics and firmware to operate a conventional analog telephone attached through a modular phone jack. Some residential Internet gateways and cable modems have this function built-in.
The softphone is the application installed on a computer or mobile phone. The application typically presents a dial pad and display field to the user to operate the application by mouse clicks or keyboard input. There are several ways of implementing VoIP; see the example in the picture. The use of a battery backup is a best practice to keep internet and telephone services going even in the event of a power outage.
Skype first came to the public’s attention with the launch of beta PC software-based in mid-2003 and quickly established itself as the de facto standard for internet PC-to-PC voice communications. The Skype application allowed users to make computer-to-computer calls for free and also included a rudimentary instant messenger program to allow text communication. Over time Skype added conference chat (multipart conversations). Then Skype rolled out new services that allowed users to call landlines and mobile phones from Skype at greatly reduced costs and by the end of 2005 had integrated video chat into its software. With the fundamentals in place, Skype in the mid-2000s had firmly established as the market leader for cheap online calling. The service was seen as a benchmark for other operators. In 2011 Microsoft acquired Skype. Since then, Microsoft has integrated all of its messaging services under Skype.
PSTN and mobile network providers integration to VOIP
It has become common for telecommunications providers to use VoIP telephony over dedicated and public IP networks to connect switching centers and to interconnect with other telephony network providers. This is known as the “IP backhaul”.
Smartphones and Wi-Fi-enabled mobile phones/tablets can use SIP clients built into the firmware or available as an application download. An example of such a dialer in Canada is Fongo.
Corporate and Business utilization of VOIP
Because of the bandwidth efficiency and low costs that VoIP technology can provide, businesses migrate from traditional copper-wire telephone systems to VoIP systems. Driven to reduce costs and gain features. By 2008 80% of all new PBX lines installed internationally were VoIP, for instance.
There are several advantages. The biggest single advantage VoIP has over standard telephone systems is cost. In addition, international calls using VoIP are very inexpensive. One other key advantage, innovation. Consider the features with VoIP phones are endless. Using services such as Skype, subscribers can call one another at no cost to either party. In 2010, the FCC reported there were over 20 million VoIP customers in the United States. In Canada, are estimated to be over 6 million VoIP subscribers.
What many people don’t realize is that if they have a land-line from a cable operator most of the time that means it is an IP-based phone. Canadian users began migrating lines around 2005. When Rogers introduced the Home Phone service as a Home Phone alternative to Bell. In different provinces started to happen the same. In Quebec, the Home Phone alternative to Bell was Videotron (2004), in Alberta the home phone alternative to Telus is Shaw. Today, all face new competition on the home phone and business phone services. Homes and enterprises find many VoIP provider alternatives. Driven by cost savings and a rich feature set, for example.
VoIP in Canada
There are approximately 15 Million landline phones in Canada, of which about 40% are using some form of Voice over IP technology. As mentioned, Canadian cable operators use a variation of the voice Over IP technology called fixed VoIP or managed VoIP. The Cable Operators have in total 5M of phone lines in Canada. On the other hand, alternative VoIP providers account for about 755,000 lines in Canada. The variation used by alternative providers is called nomadic VoIP. Traditional landlines in Canada have decreased at a 4% rate year over year. VoIP lines are increasing annually at a 12% rate. This trend will not be decelerating. If anything over the next five years the trend will be faster. Driven by businesses of all sizes moving to Busines Phone VoIP providers which in turn pushes the Home Phone providers renewal.