A category of hardware and software that enables people to make telephone calls via the Internet. Voice signals are converted to packets of data, which are transmitted on shared, public lines, hence avoiding the tolls of the traditional, public-switched telephone network (PSTN).

VoIP applications can generally be used with a simple microphone and computer speakers, but IP telephones or VoIP boxes can also be used, providing an experience identical to normal telephoning. In the past year, the quality and reliability of VoIP technology has improved to the point that vast numbers of users have abandoned their standard telephone contracts entirely, in favor of VoIP.

By upgrading your systems to VoiP, companies can immediately reduce their telecommunication costs 40% to 70%. Because VoiP IP telephony systems allow the end user and system administrators to setup and disconnect telephone numbers and services, this provides increased control over their telephone features and services.

IP telephony is usually based on standard data formats (Internet Protocol) VoiP. This permits information systems (such as product catalog information) to be more easily linked to the telephone system, thus providing the ability for companies to increase sales through interactive telephone and Internet order processing systems. You will learn that not all voice over data IP telephony systems and services are the same.

There are cost and quality tradeoffs along with common problem areas and risks in VoiP. There are many ways these systems can reduce telecommunication costs along with the ability to create new revenue producing services.