What Does VoIP Mean for Businesses?

Voice over Internet Protocol (VoIP) utilizes the same communications channels that the Internet uses to transport data traffic; only in VoIP’s case it carries voice traffic over the Internet.

What is VoIP?

Business VoIP uses the Internet Protocol (IP) for communications. Traditionally, the IP is a protocol that sorts information. For example, email would never be sent or received without using this protocol. IP also uses a technology known as packet switching. This allows the message to be broken up into sections, otherwise known as packets. The packets then move separately across the Internet, only to arrive in a single location. Once received, the IP reassembles these packets into one cohesive packet.

Public Switched Telephone Network (PSTN)

Traditionally, when a telephone call is placed, a dedicated circuit is created between the caller and the call recipient. This circuit remains open for the duration of the call, whether two people are verbally communicating or silence ensues on both ends.

VoIP Advantages

Often referred to as IP telephony, VoIP phone systems combine IP technology with the versatility and function of a traditional telephone company. VoIP utilizes software that recognizes telephone numbers as unique addresses, thus setting up connectionless calls between two or more parties. VoIP networks digitalize voices, breaking them up into packets that are then reassembled upon reaching their intended destination. This occurs so rapidly that humans cannot detect any waiting times or delays in receiving voice communications.

Types of VoIP Business Solutions

There are a number of VoIP solutions for businesses, including Hosted PBX (Private Branch Exchange), which simply connects VoIP equipment to a PSTN. This form of equipment offers a number of features, including conference calling, call hold, call transfer and much more.

Many businesses have a DSL, cable broadband or T-1 line for data connection. These lines carry the packets of information. When a company utilizes VoIP phone systems, they only have one connection because VoIP utilizes these connection points to create voice packets.

What is Hosted PBX?

A Hosted PBX system allows a business to experience all the benefits of VoIP without costly management and ownership. Instead the service provider, such as Jive, “hosts” these services for a small fee that includes flat monthly rates for both local and long distance.