As the name implies, IP refers to calls that traverse networks using Internet Protocol (IP). This may mean that the calls are going over the Internet, or it may simply mean that calls are traveling over privately managed data networks that are using IP to transport the calls from one location to the other.
The voice stream is broken down into packets, compressed, and sent toward its final destination by various routes (as opposed to establishing a 'permanent' connection for the duration of the call), depending on the most efficient paths given network congestion.
At the receiving end, the packets are reassembled, decompressed, and converted back into a voice stream by various hardware and software elements. Whether the call originated on a PC, telephone, or an Integrated Access Device (IAD), and whether it is going to be terminated on a PC, telephone, or IAD, will determine the type of software and hardware needed to initiate and complete the call. Over the years, broadband phone company providers have been working on improving and re-engineering the hardware and software used in VoIP calls. Today you can compare a VoIP provider’s voice-quality to the traditional circuit-switched technology and find that the VoIP provider’s quality is comparable and often superior. VoIP services and features have also evolved and allow customers many new and exciting options, such as online account management, three-way calling, call forwarding, and extra/virtual numbers.
What are the advantages to using IP rather than the PSTN-Public Switched Telephone Network (the phone company)?
When you are using a PSTN line, you typically pay for a physical line to the PSTN Company for the time used. The more time you talk, the more you'll pay. In addition, you will probably not have the option of speaking with more than one person at a time.
In contrast, IP Services allow you to talk as long as you would like with multiple people (other people may also need to be connected to the Internet) as far away as you want for free (calls within the same network, regardless of the physical location) or for a fraction of the PSTN cost. You can also browse the Internet at the same time; sending images, graphs, and videos to the people you are talking with.
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