Introduction

Definition
Webopedia Computer Dictionary says that VoIP is "short for Voice over Internet Protocol, a category of hardware and software that enables people to use the internet as the transmission medium for telephone calls by sending voice data in packets using IP rather than by traditional circuit transmissions of the PSTN". While that’s a fairly lengthy and technical definition, it basically means that the term VoIP refers to using the telephone over the internet. VoIP is also sometimes referred to as Internet Telephony, IP Telephony, and Voice Over the Internet (VOI).

How It Works
To enable the internet to be used as a phone connection, voice data is transferred in a digital format. This basically involves a voice being digitised into data packets which are then sent and reconverted at the intended destination. To use VoIP you therefore need appropriate hardware or software.

For example if you wish to replicate a normal phone situation, you can acquire a hardware solution that provides a phone to plug into a computer or you can even get an adaptor to allow use of a standard telephone. Software is also readily available, including free options such as Skype and Firefly to facilitate calls to other users of the same software. These software solutions are normally referred to as "softphones".

Why Use It?
The main reason to use VoIP is to save money on call costs. It can allow free phone calls to other users and cheaper phone calls to any type of standard phone around the world.

The same general principle applies to businesses of all sizes. Businesses can benefit in other ways too, including consolidation of various business applications and development of more sophisticated phone systems. Already many larger businesses in Australia have implemented VoIP solutions or have installations planned in the near future.

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