February 2012

VoIP 411

The 411 on VoIP

By NTSDirect.com

A little background on VoIP
Voice over IP (VoIP) delivers voice communications and multimedia sessions over Internet Protocol (IP) networks, such as the Internet. VoIP is available on many smartphones and Internet devices so that users of portable devices that are not phones may place calls or send SMS text messages over 3G or WiFi.

It is becoming increasingly common for telecommunications providers to use VoIP telephony over dedicated and public IP networks to connect switching centers and to interconnect with other telephony network providers. Even though IP Telephony and VoIP are terms that are used interchangeably, they are actually different; IP telephony has to do with digital telephony systems that use IP protocols for voice communication while VoIP is actually a subset of IP Telephony. VoIP is a technology used by IP telephony as a means of transporting phone calls.

Because of the bandwidth efficiency and low costs that VoIP technology can provide, businesses are migrating from traditional copper-wire telephone systems to VoIP systems to reduce their monthly phone costs. In 2008, 80% of all new PBX lines installed internationally were VoIP (1). In the United States the Social Security Administration (SSA) is converting its field offices of 63,000 workers from traditional phone installations to a VoIP infrastructure carried over its existing data network.

Benefits of VoIP
VoIP can be a benefit for reducing communication and infrastructure costs. Phone calls can be routed over existing data networks to avoid the need for separate voice and data networks.

Most of the difficulties of creating a secure telephone connection over traditional phone lines, such as digitizing and digital transmission, are already in place with VoIP. It is only necessary to encrypt and authenticate the existing data stream.

VoIP solutions aimed at businesses have evolved into “unified communications” services that treat all communications—phone calls, faxes, voice mail, e-mail, Web conferences and more—as discrete units that can all be delivered via any means and to any handset, including cellphones. Two kinds of competitors are competing in this space: one set is focused on VoIP for medium to large enterprises, while another is targeting the small-to-medium business (SMB) market.

Selling VoIP to your clients
VoIP devices have simple, intuitive user interfaces, so users can often make simple system configuration changes. Dual-mode phones enable users to continue their conversations as they move between an outside cellular service and an internal WiFi network, so that it is no longer necessary to carry both a desktop phone and a cellphone. Maintenance becomes simpler as there are fewer devices to oversee.

Small Business VoIP providers offer great incentives along with great business phone service, geared specifically for the needs of a small business. Small Business VoIP Systems also usually use hosted PBX. Hosted PBX means that the small business VoIP provider manages and maintains the VoIP phone system.

The VoIP service market weathered the economic turmoil of the last couple of years, and, with increasing customer adoption, reached $49.8 billion in 2010 (compared to $34.8 billion in 2008). While the residential services segment remains the largest of the market at 69% of total revenue, business VoIP services are growing at faster rates. (2)

What obstacles lie ahead for VoIP?
Communication on the IP network is inherently less reliable in contrast to the circuit-switched public telephone network, as it does not provide a network-based mechanism to ensure that data packets are not lost, and are delivered in sequential order. It is a best-effort network without fundamental Quality of Service (QoS) guarantees. Therefore, VoIP implementations may face problems mitigating latency and jitter. As the popularity of VoIP grows, governments are becoming more interested in regulating VoIP in a manner similar to PSTN services.

VoIP has advanced Internet-based telephony to a viable solution, piquing the interest of companies small and large. The primary reason for migrating to VoIP is cost, as it equalizes the costs of long distance calls, local calls, and e-mails to fractions of a penny per use. But the real enterprise turn-on is how VoIP empowers businesses to mold and customize telecom and datacom solutions using a single, cohesive networking platform. These business drivers are so compelling that legacy telephony is going the way of the dinosaur, yielding to Voice over IP as the dominant enterprise communications paradigm.

If you have any questions concerning VoIP systems please do not hesitate to contact us at 877.843.5393. Backed by over 20 years of experience, NTS Direct ensures that your business communication system meets your unique needs. Whether you’re a Fortune 500, a small business, or a home office, NTS Direct offers a long list of solutions, including Avaya and Samsung VoIP systems.

Visit www.ntsdirect.com or call today 877.843.5393.

© 2012 NTSDirect, Avaya and Samsung are trademarks of their respective companies.


1. Michael Dosch and Steve Church. “VoIP In The Broadcast Studio”

2. Diane Myers. “VoIP services market nears $50 billion mark”