What is VoIP?
Voice over Internet Protocol (VoIP) is reshaping how businesses manage phone calls by using your internet connection instead of traditional phone lines. It provides professional call-handling features, flexibility to work from anywhere and on any device, and significant cost savings.
More and more companies are taking advantage of these benefits – a 2024 Research and Markets report estimated that the VoIP market will grow to around $508.7 billion by 2030. But if you’re new to the topic, we’ve got you covered.
This guide breaks down what VoIP is, how it works, and why businesses are making the switch, what features matter most, and how to determine if VoIP is right for your organization.
Let’s dive in.
How Does VoIP Work?
When you make a traditional phone call, your voice travels as an electrical signal through copper wires. The phone company maintains a dedicated line between you and the person you’re calling for the entire conversation.
VoIP works completely differently, converting voice into digital packets and transmitting them over the internet. At the receiving end, they are converted back into audio. You don’t need a dedicated phone line, as the call shares the internet connection with all other online activity.
Here’s a basic breakdown of the steps involved :
- Your IP phone or VoIP app connects to the router on your network.
- When you dial a phone number, your phone tells your VoIP service provider to start the call.
- Your voice is turned into tiny digital packets, and the compressed data is sent over the internet to the other person.
- The digital recording is converted back into the analog sound of your voice, letting the recipient hear you speak.
- Their voice returns in the same way, and your VoIP phone converts those incoming packets into clear audio in real time.
VoIP systems often bypass the traditional telephone network when calling other VoIP users, but calls to regular phone numbers still connect to the PSTN at the final step.
VoIP is built on open standards like Session Initiation Protocol (SIP), which ensures that different desk phones, conference phones, and VoIP apps can all work together seamlessly.
About the Author
Desislava Vasileva
Desislava Vasileva is Squaretalk’s Marketing Director. Dessy has 10+ years of experience in Austria, Italy, Germany, Denmark and Bulgaria. She is passionate about effective communication, process optimization and delivering exceptional results.
