Voice Over IP

Voice Over IP (VOIP) is a form of packetized, digital telephone that uses the Internet Protocol (IP) as its transport mechanism. VOIP routing is based on the H.323 protocol. Due to the need for speed at the IP level, VOIP packets typically are sent using the Real-time Transfer Protocol (RTP) over the UDP protocol.

The underlying technology for VOIP is considerably more complex than for chat or text-based instant messaging, providing a potential entry barrier for smaller companies looking to enter this arena. VOIP first has to digitize (sample) a 3000Hz analog voice signal. Sampling yields a starting digital bandwidth of around 128Kbps, too high for real-time use over the internet, so the digital bandwidth has to be compressed into relatively small bitstreams (around 15Kbps might be typical).

Compression algorithms that encode for these small digital bandwidths may be proprietary and require license fees. VOIP services also typically need to connect with the Public Switched Telephone Network so that callers can reach some places where VOIP might not be available, and this also is neither financial free, not without additional technical difficulty. For example, VOIP call setup and teardown must interact with existing PSTN call control services such as Telephone Number Mapping, and the software for this must also be developed.

Despite these issues, VOIP services tend to cost less overall than the traditional landline based PSTN voice telephony services, because VOIP can be offered without needing to provide any physical infrastructure (long-haul fiber optics, or short-haul outside copper plant) that traditional telephone companies had to provide. This has put traditional PSTN companies at considerably disadvantage in the short term, until or unless they can retool their own voice calling technology to take advantage of IP-based calling.

Also called VoIP