What is VoIP? (Is It Right For You?)

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VoIP (Voice over Internet Protocol) is also known as Internet Telephony or IP Telephony. Nice names, but what is VoIP?

VoIP technology allows someone to make a phone call over their broadband internet connection rather than with a traditional telephone system. With VoIP you don’t even need a handset, just your computer and the internet.


Save Money – Using VoIP can save you around 30-40% on local calls and up to 90% on international calls. Unlike the traditional phone line where you can pay by the minute for some phone calls, VoIP relies only on your internet connection. This means that your monthly internet account which is fixed is your only cost for VoIP regardless how many calls you make.

More than Just Voice - VoIP is not just restricted to voice-to-voice exchanges but also allows the caller to transfer pictures, video, text and other files along with the voice. So next time you’re talking to a loved one half way across the world you can send them the video from Christmas.

Multiple Users - Unlike the traditional telephone setup where the call is restricted to two people (the caller & receiver) VoIP allows for conference calls of multiple people to be conducted in real time.

Available from Wireless Networks – VoIP is not limited to fixed line broadband connections but also with wireless connections making it extremely more flexible than the traditional telephone. The fact that with a laptop VoIP can act as a mobile phone, now think of the MONEY you are SAVING!

Easy to use and Affordable Hardware & Software - Besides the internet and your computer, all you need to use VoIP are speakers, a sound card and a microphone. You can even download various software packages off the net which will get VoIP up and running. These include Net2Phone and Skype.


Security – Security is one of the main disadvantages of VoIP. The security threats associated with VoIP include, viruses and malware, identity/details theft (through eavesdropping), spamming, call tampering, phishing threats and denial of service.

Voice Quality – The level of voice quality on VoIP is down to your service provider, this is known as QoS (Quality of Service). Poor service providers can mean users experience, delay, noise interference or echo’s. Poor internet connections can also cause these issues. VoIP is a bit behind the conventional telephone in this department but continued advancements in the technology is closing the gap all the time.

Internet Connection – If your internet connection is slow or unreliable then VoIP is probably not for you. The VoIP experience is heavily dependent on your broadband internet connection. Also be aware that VoIP is highly reliant on bandwidth so those with shared connections and transfer limits need to be well aware of how a VoIP service will affect their situation.

Emergency Numbers – VoIP service providers are not legally bound to offer emergency phone calls. While some do offer this service, many do not so you will need to find one who does.

As you can see, the decision to transfer over to VoIP is not just about saving money (which is what the VoIP providers want you to think because you will probably save plenty). The decision is more complex than that and security, reliability and quality issues need to be understood and evaluated before you make the decision that is best for you.


Here is a guide to give you an answer to the question - "how does VoIP work?". You will also get an understanding of not only how it works, but what you need to get VoIP up and running and how to find the best solution for your needs.


First and foremost you need a fast, reliable internet connection with good bandwidth.

The absolute minimum you need is ISDN (up to 128kbps). This is not recommended, but if you use it purely for VoIP (without other interne using programs in the background) you should be able to get away with it.

Wireless connections are usually suitable if you are on a single user network. Multiple users and a home or business network can cause substantial fluctuations in bandwidth that may cause problems with VoIP but usually a wireless broadband connection is sufficient. Be aware however on the download limits as wireless is never unlimited and going over your limit can be extremely expensive.

ADSL, LAN, and Cable connections are more than enough for VoIP and with strong connections you will almost never have a problem. The advantage wireless has over these connections is mobility. If mobility is not a requirement of your VoIP connection then these internet connections are highly recommended.

Go to http://www.speedtest.net if you need to check your current connections speed.


The right VoIP service provider is extremely important. A VoIP service provider allows you to place and receive calls. These are the different types of VoIP services available.

Mobile VoIP Services

Mobile VoIP is a new industry in relation to VoIP. This as the name suggests enables users to make VoIP calls from their mobile phones. Mobile VoIP uses your mobile phones internet connection so a data plan is required (do not exceed this) and you must be in an area where your wireless internet (on your mobile) can be accessed. If you cannot access the internet your calls will be charged at your plans traditional GSM network rates (regular mobile calls without the use of VoIP).

To Use a mobile VoIP you need a compatible phone, a regular phone with internet access is not enough. You can install a softphone onto your IP compatible phone of PDA and make free calls to people with the same service. Skype’s communication service has over 350 million registered users and is the most popular voice communication service in the world and includes a softphone in their service. Skype is the recommended way to go if you want to get into Mobile VoIP.

Subscription / Hardware dependent Services

The subscription/hardware option is the most popular and relative option for household situations. Upon subscription you receive an ATA phone adaptor which you connect to your broadband and your regular phone. It works like your normal phone but passes through the ATA.

This option is the least different from our traditional phone setup and is the most widely used for residential and small business users. You do not need your PC to utilize VoIP with this set up.

Users need to do their homework though when it comes to selecting a service provider. Many service providers have limited calling destinations available so make sure whoever you choose allows you to call those who you require the service for most.

Software Based VoIP Service Providers

A software based service is the most popular VoIP option in the world. The software based option is available to everyone in any country as long as you have the required PC/Internet requirements. Software based VoIP services are usually free as they involved PC to PC connection, so as long as you have that covered all you need is a softphone and your set.

While calls between PC users with the same service is free, calls to mobiles and traditional phones are charged, so be aware! While it is quick, easy and cost effective, software based VoIP is commonly plagued by poor voice quality and security threats such as viruses and spamming.

Business VoIP Services

VoIP is becoming increasingly popular in small business as a standalone set up and compliment to the traditional phone set up. Using VoIP in a business can reduce communication cost and increase the functionality of their communications network, allowing for streamlined video conferencing and data/fax transfer.

Recommended VoIP systems for small business are the Avaya one-X Quick Edition G11 PSTN Gateway (low cost, supports up to 40 users, easy to deploy and manage and can be used over an existing network) and the Nortel BCM 50 Main Unit (Supports up to 50 users, has both IP and digital phones, solid and reliable, good for high level use).

Device Based VoIP Solutions

Device based VoIP solutions are great because you pay for the hardware and pretty much nothing else. The set up works off an existing phone and is great for users who don’t want monthly bills. The device also works from other phones giving the user mobility. Prospective users need to be aware that the devices need a traditional phone line and some devices require a PC to work while others don’t and some companies are much higher than others, so check the details first.

There are three main device suppliers in the market today. The Ooma Core VoIP Phone System(No monthly bills and under $250, great reliability, a quality product). MajicJack (Low cost, under $40 but annual fee). PhoneGnome (The oldest supplier but still a market leader and highly recommended. Much like Ooma but about 75% cheaper).


There are many VoIP service providers out there and when selecting one you should consider a number of factors. These include.

The Cost – The initial start up cost can be misleading. Check with the provider if there are any additional costs for the service or hardware, do you own the hardware or is it rented and needs to be returned on termination of the contract. Also check the call rates as these can vary greatly between service providers.

Support – Support is an important consideration because as with most ongoing technology and communication relationships issues are likely to arise. Make sure their support department is easily accessible, has quick response times and covers both service and hardware issues. The closer you are geographically to the company the better so check for local providers as well as the largest players on the internet. If your decision comes down to two, go with the provider who is geographically closer.

Contracts – Be aware of the length of the contract and early termination fees. There is nothing worse than trying to get out of an unsatisfactory contract early and finding out that it will cost you more than seeing out the contract.

Emergency Calls – VoIP service providers are not legally obliged to support free emergency calls so check with the provider about their emergency number support and make sure they are clear and honest in their answer, as this factor can mean much more than costs – especially if you have children.

Upgrading – As with Internet service providers, the ability to upgrade as new technology becomes available or move between plans is important. Your usage may change seasonally so you should have flexibility in moving to a higher usage plan as you need and then downgrading when it best suits your needs.

Compatibility With Existing Phones – IP phones can be very expensive so it might be financially beneficial to run a VoIP service through your existing phones. If this may be beneficial to your situation check with the service provider to make sure this is possible.

Existing Phone Numbers – For many people or businesses, the need to keep their existing number is paramount. Many service providers have different allowances when it comes to this consideration so check with them first. Inability to do so can cause many problems, especially if you’ve spent good many switching to VoIP only to find out your in serious trouble because your old number doesn’t work and you’ve just wasted thousands on a new advertising campaign that launched yesterday. In reality, most VoIP will be able to transfer your number over but it’s better to be safe than sorry. Switching numbers from one VoIP service provider to another is another story all together and can be a real hassle.

The Service Providers Stability/Reliability – As with the early days of the internet boom where many smaller ISP’s seemed to set up over night and then disappear in a matter of months leaving many subscribers out in the cold, the same as happened with a number of VoIP service providers. Make sure the service provider you join has been around a while and guarantees their service or your contract is void.

The Actual Service – Make sure the company supplies all the features and services you require. From the international calling destinations, fax/video conferencing services, caller ID, voice mail, call transferring, call waiting etc. Talk to other users if you can or read independent reviews on the net to gather the best information you can.


Setting up a basic VoIP system in your home or on your PC is usually quite simple (Business setups can be much more complicated and may require professionals). The service comes with easy to follow instructions (most of the time).

Hardware based VoIP systems is basically just a matter of plugging in your ATA to your internet router and your telephone into the ATA. Configuration settings are usually downloadable or contained in the accompanying software and at most a quick email or phone call to support is required.

Software based VoIP systems are again quite elementary. Just install the software after placing the disc into your drive or after downloading the software onto your PC. Then all you need to do is create and register a user name and/or account, purchase credit (if required) and off you go.

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