Understanding VoIP: Basics and Benefits of Using in 2024

A key component of running a successful business is maintaining open lines of communication both internally and with outside parties. Traditional landlines, with their tangled wires and excessive phone costs, are a thing of the past. VoIP, or Voice over Internet Protocol, allows you to make phone conversations over your Internet connection. You get access to flexible calls, extensive capabilities and crystal-clear audio.

If you own a business and want a better way to interact with your employees, you should look into this popular business phone service.

This article answers your question of: what is VoIP and how does it work? How can you locate the finest VoIP provider to make calls without using a physical landline?

What is VoIP?

VoIP is becoming the standard for contemporary business communications. Making phone calls using an Internet connection is a well-established technological feature. Since it was first created in 1995, it has become more stable and reliable as the Internet has grown. It has also become the preferred choice for businesses upgrading their phone systems. So, what is VoIP exactly?

The term “Voice over Internet Protocol” (VoIP) refers to a method of making phone calls that uses your existing local area network (LAN), wide-area network (WAN) or other infrastructure to transmit digital data packets over the Internet instead of the more conventional circuit-switched network.
VoIP utilizes the real-time protocol (RTP) to guarantee the timely delivery of these packets. Connecting to VoIP via an Ethernet wire or a fast WiFi network is possible.

People choose VoIP over traditional phone lines because it allows them to make long-distance calls even when they don’t have a phone service.

No additional copper wiring is required if you have access to the Internet. As a result, people can telecommute to the workplace or work remotely from their homes.

How does VoIP work?

Virtual private networks (VoIP) allow regular phone calls to be converted into data packets and sent over the Internet instead of through mobile networks or landlines. It does its job by digitizing your voice’s analog impulses before sending them over your fast Internet connection. 

VoIP systems allow you to make and receive calls via your existing Internet connection rather than a dedicated phone line. A versatile and reasonably priced business phone solution is the end product.

Small data packets carry the conversation during phone calls. In just a second, these data packets can be transmitted all around the globe through the Internet. When you use Internet telephony, the packets go from your phone to a VoIP provider.

With VoIP, the phone company is completely bypassed. You can use VoIP anywhere with a broadband Internet connection, whether DSL, cable or fiber. Compared to the old analog phone system, it’s a vast improvement.

How does VoIP work? 

Let us explain it to you:

1. Within your LAN, your phone connects with your router or switch.
2. Your IP phone will communicate with your VoIP provider to make the call when you dial a number.
3. With a VoIP service, your IP phone can make calls and send and receive data packets.
4. The sound you hear on your VoIP phone is a conversion of these digital signals.
   

If you wanted to use VoIP over twenty years ago, you had to shell out a pretty penny for some proprietary gear. It is now possible for VoIP to work thanks to open standards like Session Initiation Protocol (SIP). SIP ensures compatibility between regular phones, conference phones and VoIP applications.

VoIP vs. Landline — What’s the Difference

Traditional landline phones carry audio signals over separate copper lines using the antiquated Public Switched Telephone Networks (PSTN). 

Despite its lack of bells and whistles, landlines nonetheless provide reliable service thanks to private branch exchange (PBX) technology, even when the power goes out. 

Due to the need for expert installation and specialized infrastructure, traditional phone systems are more expensive than VoIP.

Voice over Internet Protocol (VoIP) uses the current state of the Internet to transport audio data packets dynamically over broadband connections. With VoIP systems, businesses can enjoy substantial cost savings, mobility through remote access and handy calling capabilities.

The dependability and quality of your VoIP calls can change depending on your Internet speed and the provider you choose. Service interruptions can also occur due to power outages and network jitter.

With the correct procedures and a dependable VoIP provider, VoIP issues are simple to resolve.

Despite some problems, Voice over Internet Protocol (VoIP) is still the way to go for telecommunications. VoIP phone systems are far less expensive than comparable mobile phone deployments. In general, enterprise-focused features like analytics, customer relationship management and software integration should be included in modern mobile phones, even though they may have many of the same capabilities as VoIP phone systems.

What is a VoIP service?

The companies that supply VoIP services are known as VoIP service providers. Usually, clients pay a monthly fee to use their VoIP devices and equipment. Businesses and homes alike can use a VoIP system through a service provider.

VoIP is much more than simply a voice call technology; as a result, VoIP service providers provide a wide range of additional communication features, including SMS and instant messaging, emailing, call management, SIP compatibility and more. These days, VoIP companies offer a whole suite of services to meet all business communications needs. In addition, VoIP hosts facilitate the integration of pre-existing software with VoIP services, including customer relationship management (CRM), cloud, help desk and e-commerce platforms.

An all-encompassing VoIP provider becomes your company’s technical partner because VoIP assistance has expanded to encompass all parts of business communications.

Businesses can benefit from starting a VoIP business partnership since it helps them maintain unified communications with their clients and customers. Voice over Internet Protocol (VoIP) calls are substantially cheaper than traditional phone networks. Their advanced features provide infinite call alternatives through a reliable Internet connection. That’s what makes the VoIP alternative better. Companies looking to optimize their communication systems need to understand what is VoIP service.

What are the benefits of VoIP?

What is a VoIP phone used for and what are the real benefits that make it superior to conventional phone systems?

1) Affordable Call Rates and Additional Savings

Reducing communication expenses is a significant motivator for companies to adopt VoIP phones. Virtual private phone systems are inherently more cost-effective than traditional landline phone systems.

To start with, there is a significant decrease in the call rates. A VoIP subscription from most providers will include unlimited local calls and significantly discounted international minutes. Contrast this with the potentially $50+ monthly cost of a PBX line with the $30+ monthly cost of a VoIP subscription. And there is more. If you want to use a landline PBX phone, be aware that you will still be subject to your telecom provider’s usual call fees.

Secondly, compared to wired alternatives, VoIP systems’ installation and maintenance costs are significantly lower. In most cases, VoIP service providers for businesses offer a discount on phones that can use their service. In addition, they handle the technological aspects of the phone.

2) Automated and Optimized Processes

Since VoIP calls take place via the Internet, a great deal of digitization and automation is possible, which, in turn, simplifies things for everyone on the team.

VoIP services do not impose this restriction, unlike landlines, which only allow one phone number per user. Thanks to modern technology, you can now simultaneously process numerous requests from different phone lines.

You may save money, train your staff better and break records for revenue with the help of VoIP telephony software solutions, which offer a wide range of functions.

The most used automation features are intelligent voice response (IVR) flows, ACD (Automated Call Distribution), skill-based call routing, smart power, predictive dialing and business hour settings. 

Keep up a consistent level of service with the support of real-time dashboard analytics, agent reporting and call monitoring. 

Operators may speak with clients more efficiently with scripts and call note-taking, and any CRM or tool you require for your business can be connected with the help of API. 

3) Complete Portability

With VoIP, you can make and receive calls from your device. Your company’s phone lines are no longer limited to landlines when you use VoIP. Desk phones are superfluous.

Your mobile device, computer or tablet may make and receive VoIP calls. Another advantage of VoIP is that national boundaries do not obstruct it. As long as you have access to the Internet, VoIP can be used from anywhere in the globe. This allows you to effortlessly bring your office with you wherever you go.

4) More Call Features

One should not mistake VoIP for a standard phone system. With VoIP, you receive a lot more than with regular phone calls. Voice over Internet Protocol (VoIP) enables users to multitask by allowing them to communicate using multiple tools simultaneously.

Imagine you are answering a phone call. You can learn who called and why by reading a transcript of their message in your inbox while you wait. Meanwhile, you can easily share a critical voicemail with any of your coworkers by tapping a screen or clicking a button. You can connect your VoIP service with essential business communication apps, such as customer relationship management (CRM) systems or even send SMS messages. Unlike conventional phone systems, VoIP comes with a plethora of automation options. These include intelligent call answering, advanced call forwarding and transfer, auto help, conference calling, hot desking and monitoring and logging of calls. VoIP offers the flexibility and scalability necessary for a complete unified communications system.

What are the drawbacks of VoIP?

Now that you know what is a VoIP phone system you need to learn that VoIP phones have their drawbacks:

• Limitations on performance. Voice over Internet Protocol (VoIP) phones are vulnerable to bandwidth limitations and need a constant Internet connection. Calls may be delayed or even dropped if there isn’t enough bandwidth to prevent latency. People also can’t use VoIP phones to make calls if the company’s power or Internet goes out.
• Emergency calling. It might be challenging for 911 operators to direct calls from VoIP phones to the correct emergency call center because IP addresses do not provide the precise location of callers. The Federal Communications Commission has mandated that VoIP operators implement Enhanced 911 (e911), and they can turn to third-party suppliers to help them fulfill this obligation.
• Vulnerable to Cyber attacks. Cyber attacks can compromise it because it is an online service. Eavesdropping and denial-of-service attacks are just two of the many security threats. Nevertheless, safe software and dependable service providers take precautions to prevent these vulnerabilities.
• The need to re-train your staff. The learning curve for transitioning to a VoIP service will be higher if your team is accustomed to using landlines in-house. You must answer your employees’ question, ”What are VoIP phones used for?” You may easily guide your trainees through the new system using features like warm transfers, real-time dashboards, call whispering and call monitoring. 

How to use VoIP services?

A VoIP business phone provider is required to make a VoIP call. You should also have a high-bandwidth Internet connection. 

How to use VoIP service? You can use any of these devices to make a VoIP call:

• You can use your current phone handset. An analog telephone adapter (ATA) can link this to the VoIP network and assign it an IP address. The ATA is a convenient alternative to plugging your phone directly into an electrical outlet.
• An IP phone. As far as the eye can tell, this is just another analog phone. A charging cradle, which features buttons, is compatible with the handset. On the other hand, the IP phone uses an RJ-45 connector rather than an RJ-11 one. This means it is not compatible with phone connectors but with the ethernet ports on your router. Some VoIP companies may provide you with a complimentary phone handset at certain times of the year.
• Your computer. An app that supports VoIP calls is required. A sound card, headset or microphone/speakers are also needed. Additionally, you’ll require some Internet connection, be it WiFi or an ethernet cable. Apps for Windows and Mac are available from most popular VoIP providers.
• Your cell phone. As before, you’ll need the correct app and access to wifi. Alternatively, you may use a 4G or faster mobile data plan. You can get VoIP apps for any smartphone, including iOS and Android.

3 Best VoIP providers

Provider 1. Phoner

Best pick for: Most people, startups and small companies agree it’s the best VoIP phone service.

If you use the Phoner VoIP phone system, you can always keep your phone number to yourself, whether for running a business, shopping online or going on dates. Once you add your new number to Phoner, you can start making calls in the US and abroad. This VoIP company doesn’t have any new deals or carriers. Your current desktop and mobile devices can connect and sync with everything. You can make as many foreign calls as you want. The provider offers many virtual phone numbers, each with its own area and country codes.

Users like Phoner because it is easy to set up, doesn’t cost a lot of money and can be used for various personal and business uses. Even though some reviews point out small bugs, most users have had a great experience with it. You can get Phoner here and enjoy all of its perks.

Pricing: 

Phoner VoIP phone service offers two pricing plans: 

• Monthly – $9.99/month
• Yearly – $69.99/year

Reviews: 

Trustpilot: 4.7/5 (300+ reviews)

Pros:

• Pleasant, easy-to-navigate design
• Reliable quality of phone calls
• Ad-supported tier
• Reasonable prices
• Disposable numbers
• Voice call recording
• Message encryption
• Support on Desktop, Android and iOS

Cons:

• Not many extra features
• Best for simple tasks

Provider 2. Squaretalk

Best pick for: Traders, telemarketers, insurance agents, financial advisers, BPO call centers, proactive sales teams, customer experience and retention teams.

Automating and integrating things is more manageable with Squaretalk, a flexible VoIP company. Because it’s simple to use, you can focus on other parts of running your business.

A cheap, expandable and easy-to-use communications business phone system can give your sales and phone support staff the tools they need to be productive no matter where they are or what route your clients choose. Whether you use Zoho, Salesforce or another well-known CRM, the VoIP phone system’s built-in interfaces and custom API will make the process easy.

Pricing:

• Standard – $15/user per month, billed annually 
• Professional – $30/user per month, billed annually

Reviews:

Capterra 4.8 (72)

Pros:

• Good customer support
• Cost-effectiveness
• ​​Fast connection
• Auto-dialer
• SMS Messaging
• Call list management

Cons:

• Expensive for some users
• Mobile app issues
• Learning curve

Provider 3. Talkdesk

Best pick for: The best VoIP service provider for incoming and outbound call centers.

Talkdesk’s business VoIP phone service is flexible and lets you set up almost all the features a contact center needs. Talkdesk helps people in different areas communicate better by putting all its users on one platform. Thanks to the desktop and mobile tools, team members can check their voicemails and call from any device.

Talkdesk’s best feature is the CX Cloud platform, which was made for incoming and outgoing talks. Interactive analytics driven by AI and virtual agents are used to improve customer service to a whole new level. VoIP services enable intelligently routing calls, handling call queues and reporting on agent call metrics.

Pricing:

• CX Cloud Essentials: $75 per user/month
• CX Cloud Elevate: $95 per user/month
• CX Cloud Elite: $125 per user/month
• Experience Cloud packages: Contact Talkdesk to get info about pricing

Reviews:

Capterra 4.5 (721)

Pros:

• Excellent quality of calls
• Easy integration with Salesforce
• Easy to use
• Incredible flexibility in IVR
• Good Support team

Cons:

• Issues with the reporting functionality
• Hard to use without a reliable Internet connection
• Bad data interpreting

Summing up

Picking a VoIP service is a crucial business choice. Now that we’ve answered the question of what is VoIP and how does it work, you have to choose your VoIP provider wisely. Check out several VoIP companies based on their calling plans and prices, how flexible and customizable their service is, how well they work with mobile devices, how well they support their clients, the quality of their voice and video output and whether they integrate with other business tools. Pick the best VoIP provider for your business by considering your needs. Good luck!