VoIP, Voice-over-IP and IP Telephony explained in simple words

VoIP, Voice-over-IP and IP Telephony are all common terms used to describe the same computer technology : Carrying phone calls over the Internet ( ADSL ) rather than over a telephone provider ( Telstra ).

A widely used and industry standard VoIP protocol ( language ) is called SIP. SIP is the protocol that hardware and software manufacturers use to talk the "VoIP language". Most modern VoIP hardware and software use SIP. When SIP is configured correctly, telephone calls will be routed over the internet.

Why use VoIP ?

A VoIP provider is a company that offers SIP accounts. A SIP account is used to login to your VoIP provider's SIP server so that you can use their SIP services. Some SIP services might include the use of Voicemail, or transferring calls from your computer to the PSTN ( Optus / Telstra ) landlines. VoIP providers usually have access to a big network of linked SIP servers who are all located in different physical locations. The benefit is that they can provide local call costs at all the locations that they have SIP servers.

When you are calling people who are not online but use a normal telephone, your VoIP provider has to transfer the call from the internet to a normal telephone line. This is where costs will be involved because your VoIP provider has to maintain physical connections to the telephone provider ( PSTN ) which in Australia usually means Telstra phone lines. These lines are not cheap and thus your VoIP provider will ask you for a compensation in the form of a monthly subscription or pre-paid telephone credit.

There are significant advantages to use a VoIP provider to call normal telephones, because VoIP will use the internet as much as possible ( the free part ) and will only transfer the call to the PSTN provider as close to the recipient as possible : This results in local call charges for your VoIP provider and thus lower charges for you. Suppose you are living in Australia and you want to call a friend who is located in China. Normally Telstra would charge you a lot of money per minute. If you use VoIP however, the call up to China is made over the internet for free ; once your call reaches China, it will be routed on the PSTN using local call costs. This is how VoIP can save you a lot of money.

ADSL bandwidth

When you signed up for your ADSL connection, your ADSL provider probably asked you what ADSL "speed" you wanted to buy. Higher speeds come at a higher price. "Speed" is actually not something that says a lot technically. Technicians use the word "Bandwidth" to define speed and it is expressed in numbers : 1500/512 bandwidth means that you can download at 1500kb per second, and upload at 512kb per second. Usually 90% of your internet usage will be downloads, and 10% will be uploads, hence the bigger allocation to downloads than uploads. For instance when you surf to a website, your internet browser ( Internet explorer / firefox / opera / chrome ) will send a simple short sentence to the webserver which is only a few bytes big which says "please send me your website content" , the website then responds with the whole content of the website ( which could be anywhere from a few bytes to hundreds of megabytes ).

VoIP and QoS and Traffic Shaping

Because VoIP uses your internet connection, your telephone calls will share the bandwidth allocated by your ADSL provider. It also means that applications like internet explorer, outlook express, bit torrent, kazaa , file transfers or other downloaders compete for the same bandwidth. Each application will try and use the maximum available bandwidth and this often results in everything slowing down to a halt. You could compare it with a traffic jam on a highway. The highway only has 2 lanes (1500kb per second), but there are far too many cars (applications transferring bits and bytes) on the road, and eventually the road clogs up and you end up with a traffic jam! You might have experienced this yourself. For instance when your children are downloading MP3 music, your internet will slow down, and sometimes will time-out and not be able to reach the website. If this happens to VoIP calls, the result will be that the call quality degrades, up to a level that the two calling parties will not be able to understand each other.

Luckily, as technology advances, solutions are presented. In this case, it presents itself in the name QoS which means Quality of Service. Going back to our highway example, QoS could be seen as a police patrol car with sirens and flashing lights driving between the cars : QoS gives priority to applications on your network. With QoS you can prioritize your VoIP packets ( network packages of bits and bytes ) to make sure that they are sent out and let through quicker than other packets. This will improve your call quality drastically.

However, sometimes even the police have trouble getting through the dense mass of cars! If the road is really clogged up and there is no room for the police car to pass through, then even the police car has to wait. The same applies to your VoIP packets. Luckily again, this problem was solved with something called Traffic Shaping. Going back to our highway situation, we now added a shoulder over which cops (VoIP), ambulances (management and finance departments) and firetrucks (important database applications) can drive at full speed while the traffic is jammed on the main road. Traffic shaping reserves bandwidth on your ADSL connection purely for VoIP and other important applications, so that your voice quality is assured. Voice packets can now travel at full speed over their own reserved amount of bandwidth (highway shoulder) and not be harmed in any way by the traffic on the main ADSL line (jam on the main highway). You can make as many "shoulders" as you want, you can have 1 shoulder purely for VoIP and another for important departments, whichever suits you best. This way, you can restrict non-productivity related activities ( downloading music / browsing non-business websites and youtube for instance ) to a small amount of bandwidth so that your important business-related applications have access to the bandwidth that they need.