What is Voice Over IP

It is hard to imagine that the internet was actually first introduced in 1969. At that time, it was used to share information amongst researchers and today it is used by more than 4 billion people worldwide. Technology is ever evolving and improving to make our lives easier. The internet has affected many areas of our lives from how we find information to how we shop and from how we keep ourselves entertained to how we communicate with each other. VoIP combines the best of both worlds by allowing us to access the internet for our everyday needs at home and at work while allowing us to converse with people without the need for a traditional phone line.

What is VoIP?

VoIP meaning is an actual acronym standing for Voice Over Internet Protocol. In basic terms, VoIP provides a dependable phone connection using the internet instead of traditional phone lines. VoIP greatly reduces costs by allowing voice and data communications to travel on the same network.

By combining your voice and internet communications into one service you also make it easier to add more lines and features as your business grows. VoIP runs over an IP network, which means your data is conveniently stored in the cloud making settings easily accessible through a universal application. This makes it easy to access information such as contact and client history whether employees are in the office, working from home, or traveling.
Mobile Work Force

Who invented VoIP?

In many cases, the development of new technology can be difficult to trace to any one person. However, when it comes to VoIP, Alon Cohen is said to have developed the audio transceiver that enabled internet users to speak to each other in 1989. This transceiver was the jumping off point for VoIP.

This invention changed the telecommunications industry. Cohen, who is now the executive vice president of phone.com, established his first company, VocalTec in 1995. VocalTec pioneered the “Internet Phone” which provided a way for people to speak to each other using the internet. The following year, Internet voicemail applications were introduced, allowing internet users to send voicemails to destination phones. Although there were many issues, from poor quality sound to connection loss, they were able to launch an Internet phone software that worked with Microsoft NetMeeting the same year.

One of the biggest attractions to this development was the idea that calls could be made for free. However, usage came with what consumers viewed to be a far more annoying price: having their calls interrupted by marketing ads. This was the main reason that in 1998 VoIP accounted for less than 1% of calls being made at that time.

How did VoIP Develop?

Over the next 10 years, the industry became interested in finding ways to use this new transmission technique in a way that would appeal to consumers. They wanted to develop more dependable ways to use IP based systems in order to deliver a phone service that offered better quality and lower cost than traditional phone lines. With this common goal in mind industry leaders added IP capabilities and looked to developing software that made it easy for customers to access VoIP with an adaptor that worked with their current phones.

As new software was introduced, companies were competing for customers using their own VoIP switching software. This software became a standard add-on with their service’s routing equipment and by 2003, 25% of all voice calls were made using VoIP.

This increase in interest led to improvements to broadband Ethernet service availability, improving the quality of calls. It also meant that connectivity issues of the past were improved. However, callers still did experience static and had to worry about potential connectivity issues but not enough to deter usage. Users loved the fact that they could have access to a single service that allowed them to play games, browse the internet and make phone calls.

In hand with advancements to add-ons, the communications hardware industry also became interested in making VoIP more available. They began manufacturing equipment for VoIP calling that could make the switch to internet calling easier. The introduction of this hardware allowed for the switch to take place instead of depending on CPUs to transform voice data packets into readable information for the public telephone network.

Modern Office CommunicationsAll of these advancements attracted more and more consumers who were able to see the advantages of VoIP calling as it rid them of costly long-distance telephone calls. At the same time, the business world began to show interest as it allowed them to have access to a dependable, affordable phone option that appealed to their global needs.

VoIP Impact on Business

With the rapid growth of the internet and web communication more and more corporations were frustrated with the cost of communications. As well, in 2000, the government began regulating VoIP communication. VoIP for business made it easy for companies to move their call centers to countries such as India to overcome the huge costs of phone services. While this negatively impacted the job market, it met the demands of North American customers who wanted customer support 24/7.

There were other ways companies could maintain their North American set up with additional shifts. They introduced offices across all time zones to offer the expected 24-hour service customers expected. This of course was far too costly and made it difficult for companies to manage operating costs. At this point, an attempt to merge voice and data was still not a viable option as VoIP quality was poor. However, seeing the demand was there, Internet Telephone Service Providers (ITSPs) latched onto the opportunity to gain momentum with this changing demand and invested in upgrades. They then charged companies who wished to use this higher quality service, attracting more businesses to try the VoIP route.

Introduction of Skype

During this time the government had little influence over VoIP, and this allowed smaller communication companies to jump on the VoIP bandwagon. Services included pre-paid calling cards for consumers as a more affordable long-distance option. By 2003, Skype began to gain attention with the introduction of their beta software. With the option to make free long-distance calls and use Skype’s free messaging service, there was a very accessible communication option that appealed to everyone.

Skype was responsive to customers’ needs which gave them a huge advantage as consumers demanded an affordable, high-quality mode of communication. These demands included the ability to call cells and landlines, not just computers. As companies began to offer this option for a fee, it was still lower than traditional phone lines and other VoIP services.

When Skype introduced video chat in 2005, they created a new, far more personal way for people to interact from anywhere in the world. This set a benchmark in the industry. However, Skype’s decision to keep their network closed and limit the software that could be used as a downside for some users. Despite this, it guaranteed a monopoly for Skype in the industry.

To compete with Skype’s position as king of VoIP, full-service VoIP providers began to fight back in 2004. This was the beginning of services such as unlimited domestic calling at a flat rate and shared free calling in families and groups.

VoIP calling capabilities allowed telecommunication companies to create all-in-one bases allowing businesses to access everything they needed including:

  • Faxes
  • Phone calls
  • Emails
  • Voicemail
  • Web conferences

Today companies have the choice to request these services separately and they can be accessed by any office phone or cell phone. There are now more choices than ever including Skype VoIP services for organizations of all sizes.

VoIP Business Today

Today, VoIP business provides everything large businesses need despite the growing pains over the past decade. Where once only large businesses were able to access high-demand features such as auto attendants, ring groups and music on hold, today’s VoIP based phone systems can include everything you need regardless of your company size.

You will find a growing number of distinctive features included with your monthly fees so there are always options available to suit your needs. You are no longer faced with one option through traditional analog systems that are costly yet have limited features. Instead, VoIP based business phone systems provide the perfect choice whether you are local, Canadian, North American or global.

VoIP PhoneHow does VoIP work?

As already mentioned, VoIP uses internet connections to provide voice services. It takes analog voice signals and then converts them into digital signals. This then allows voice signals to be sent as data using a broadband line. Today, it offers the same quality as traditional phone lines, but at far more affordable prices. This is because using the internet allows you to speak to people around the world without worrying about distance like traditional phone lines.

The connection is available in three ways:

  1. Ethernet and Wi-Fi: Connection through IP networks is the most traditional option.
  2. Analog Telephone Adapter: This works with an analog phone that connects to the network through a wall jack. You can make VoIP calls using your landline phone by plugging into a phone socket or into a router.
  3. Softphone: This works on the computer through an app allowing people to chat using a headset. Apps include Skype, Google Talk, and Apple FaceTime. The catch here is that the calls are free, but people have to use the same App as you to do so. If you call a phone or landline that does not share the app it will cost you.

One of the biggest selling points for VoIP business systems is that they can adapt to accommodate a single phone line or upwards of 99.  Your system operates through a broadband internet connection allowing your company to use the system anywhere in the world without the need to change your phone number. They are “hyper-portable” to keep up with smaller, more mobile business phone systems while allowing for integration with many business support systems such as:

  • Sales Force
  • Fresh Books
  • Workday
  • Oracle
  • Outlook

As already mentioned, your business phone service is hosted in the provider’s cloud meaning part of your IT infrastructure connects to a secure data center via the internet. This server also provides a dedicated private branch exchange (PBX) routing all your incoming and outgoing calls smoothly.

In many cases, VoIP business system providers will take care of the installation for you making it a very manageable process when you compare it to the complicated resources required to install traditional telecom systems.

Is VoIP worth using?

As with any service or product, you have to consider how it works and if it is suited to your needs. However, for the most part, people appreciate VoIP usage because it costs much less and provides increased functionality.

VoIP phone is available for lower costs over traditional sources because traditional services are affected by government entities or are manipulated by large corporate monopolies in the industry. As well, you will also save money because you are using one network for both your voice and data. There are actually some services you can find for free, but you have to really hunt for them, and you might find a sacrifice in service. And by free, they mean you will not pay extra to make calls, but you will still be paying for your internet connection.

From a functionality standpoint, VoIP for business makes it easy as incoming phone calls are routed to your VoIP phone automatically when you plug into the network. That means you can even take your VoIP phone along when traveling, connect it to the Internet, and take calls wherever you go. For businesses call centres, they can be set up anywhere as long as there is a strong internet connection.

If you want to crunch the numbers, you can look at what you currently spend on:

  • Each traditional telephone line
  • Typical long-distance charges
  • The cost of dual networks for phone and internet
  • Maintenance costs

As already mentioned, the costs associated with VoIP are far more affordable as often the providers will cover many costs such as the purchase/rental of equipment. As well, your business requires Session Initiation Protocol (SIP) to enable your VoIP phone system. SIP trunks use VoIP to provide flexible communication for your company. You can also allow your traditional “land” lines to use VoIP connectivity to utilize SIP trunking for savings that can be as much as 60 to 80% less than other phone lines. It will also provide quick access to additional lines as you require them and also increase the reliability of your connectivity. SIP Trunking also eliminates the hardware, wiring, or circuit boxes that are needed for other phone services. The connection is installed “virtually” eliminating the need for traditional phone lines. Because this connection only requires one point of entry for all of your lines, you see a reduction in charges.

The most important thing to look into is whether or not your current network infrastructure will provide the additional bandwidth you will need to manage the voice traffic.

Where to use VoIP?

VoIP is an excellent solution if:

  • You are looking for a dependable phone system that will save you money
  • You require affordable, easy scalability for your phone system
  • You have access to high bandwidth to accommodate your phone usage in hand with your current internet needs

Today who uses VoIP and why?

With all the history behind it, VoIP has finally become recognized as a viable and affordable phone service option. It has become an integral communication source for many consumers and businesses around the world. VoIP technologies are the go-to choice for people to affordably keep in touch with family members overseas as in many cases it is free.

For companies, VoIP provides a highly affordable and dependable communication tool to manage the day to day communication. It has become a logical choice as it has simplified communication offering a single connection for both phone and internet. It has lowered expenses and allows for convenient growth with more flexibility and affordable installation. As well it can be used from any device and from anywhere on earth.

Today, every telecom provider offers their own version of VoIP. This includes major providers such as Rogers, Bell, and Shaw. This means you can use VoIP anywhere the service is offered. It is ideal for organizations with Unified Communication (UC) deployments. It allows you to integrate different communication channels and protocols for seamless operation. It allows you to consolidate everything you need including instant messaging, voice calling, conferencing, and video chat with a single suite.

It can also be easily integrated with other applications and all calls are routed using an IP. This is highly effective for international and overseas calls.

The reasons many depend on VoIP today include:

  • Cost-effective: VoIP reduces cost by a) allowing you to use one service eliminating paying twice for communication for phone and internet and b) often eliminating if not greatly reducing the costs associated with long-distance calls.
  • Simple installation: As you have read, VoIP installation is fairly easy and often installed from start to finish by providers. It allows for scalability ideal for companies requiring the addition of more lines. With the introduction of software, voice transfer to digital signals is also done smoothly without interfering with quality.
  • Flexibility: VoIP caters to the needs of today’s business allowing people to use the same system from the office while working from home and while traveling. It also works across all devices from computers to mobile phones.
  • Improved features: Features traditionally only available via phone lines, or to larger businesses are now available to companies of all sizes.
  • Flexible network layout: Unlike complex PSTN connections, the underlying network is flexible and can also be used with Wi-Fi.

You do have to keep in mind that VoIP call quality is affected by the state of your broadband line. If you have a slow internet service, you will also experience issues with your call quality.

VoIP has changed the way we communicate both at work and at home. It has provided us with a simplified way to combine all of our communication needs into one easy and affordable service, with a growing number of service providers competing for our business. This works to your advantage keeping prices and packages more focused on meeting the needs of the individual for more savings and increasingly better quality.

For more information on the VoIP packages available for business take a look and research your new Home Phone or Business Phone Today!