What is VoIP?

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What is VoIP?

VoIP stands for Voice Over Internet Protocol. Through VoIP, one can place and receive calls over the internet. For small businesses, VoIP is largely preferred over traditional phone systems. It is because along with a lot of added functionalities, VoIP is cheaper than traditional phones as well. As we progress into this article, we will discover how and why VoIP is better. But first, let’s understand what one can do with VoIP. 

Why VoIP?

Now that you know what VoIP is, Let’s explore why one needs VoIP. VoIP has been around for some time now. It was developed around the year 1995 as a means of making international communication cheaper. The ‘InternetPhone’ connected one caller to the other through common software. The speakers and microphones of both the users were connected through this common software. Fast forward to 2021 and VoIP can still be used to communicate with users overseas along with a lot of cool new developments. 

Today, small businesses can use VoIP not just to communicate within their office but also with their customers. Along with the functionality of placing calls, VoIP allows businesses to : 

  • Record calls (incoming and outgoing) 
  • Route calls to the desired department 
  • Use IVR (Interactive Voice Response) to allow customers to reach their desired department through prompts on their keypad. 
  • Get information about the caller not just limited to caller ID. This could include information such as their Name, DOB if they are an existing customer or a new one, or any additional information that might have been stored in your database.
    (NOTE – you can use this information to personalize the customer call and give them a better experience) 
  • Integrate with your business’s existing Database. 

How does VoIP work? 

To put it in simple words, communication over the internet is achieved through a change in the format of the message (voice, audio, etc). For data to be transmitted over the internet, it needs to change its form. A voice call placed through the VoIP phone is broken down and converted into small packets. Each of these separate broken-down packets contains information that when assembled at the receiver destination again forms back into the original audio.

What is VoIP?

Packet switching is a technique that involves sending packets of data according to the most efficient route available at the time. VoIP uses packet switching. As opposed to traditional phone lines that use circuit switching, which involves establishing a line and keeping it reserved for that purpose, packet switching is done across various networks and does not need a pre-established route. It allows the following advantages – 

  • Increased efficiency as the circuits are not reserved. They are used as and when they are needed. This also means that the network bandwidth is not wasted.
  •  Decreased cost, as there is no need to set up a physical network. 
  • Increased speed, as the best route for transmission, is determined and used to send the packets. 

VoIP Phones can be both hardware-based and software-based. What looks like a normal desktop phone, configured to send and receive calls over the internet is the hardware-based VoIP phone. Other devices such as mobile phones, computers, tablets, etc can also place calls over the internet if they have software that enables the same. These are software-based VoIP phones. So employees can make and attend calls from anywhere, even using their personal phones or computers. One can be sitting in their office or in a theatre and still attend calls. 

This is how it works: 

Step 1 – Your phone connects to your switch or router in your Local Area Network (LAN).

Step 2 -When you dial a telephone number, your IP phone tells your VoIP service provider to call the other party.

Step 3- Your VoIP service establishes the call and exchanges data packets from your IP phone.

Step 4 – Your VoIP phone converts these digital signals back into the sound you can hear.

Differences between a VOIP phone system and a landline

There are a lot of areas in which VoIP phone systems and landline phone systems differ.


The cost of setting up and maintaining a physical landline phone system is usually a lot higher than that of setting up and maintaining a VoIP phone system. To give a number to it, VoIP is anywhere between 40-80% less expensive than traditional phone systems.
PBX systems (private branch exchange) are used to keep a communication line for employees in an office. This involves physical connections and setting it up is quite costly. Compare this to modern-day VOIP systems that hardly require any physical connections.

Material Used

Traditional phone lines use copper wires for connections and VOIP systems use the internet, so no extra hardware is required. The dependence on copper wires also means that connection can be made only in places where the wired connection is available, as opposed to VoIP which is independent of this requirement. Copper wires can only transmit a certain amount of data before they need to be reset, which can cause dropped calls and other problems. On the other hand, Fiber-optic cables can transmit data much more quickly and without any interruptions.


While traditional phone systems only offer limited features VoIP comes with a variety of new and improved features that make communication much easier within the office as well as with customers. Some of these features are call routing, IVR, call pop, etc.

VoIP equipment

Most VoIP systems are software-based and do not need much hardware equipment. However, there are a few necessary pieces of equipment that require installation. These are :

1) Analogue Telephone Adapter or ATA

This piece of equipment is necessary if you want to use your existing phone to place calls over the internet. The ATA basically acts as an interface between your phone and the VoIP line.

2) Ethernet Cable

This wired connection is needed to connect to the internet.

3) PC Headset 

PC headsets are devices that are used for audio purposes. It allows you to hear audio and talk through a microphone.

4) VoIP desktop phones

These are wireless phones that are equipped with VoIP technology. You can use it from anywhere, home or office. It just needs a one-time setup

5) VoIP Router

VoIP routers are devices that will allow you to place calls over the internet. By using a router for VoIP, you can receive incoming calls through your Internet connection.

Advantages of VoIP

Now as we’ve gained some understanding of what is VoIP and how it works, we can try and understand how it can be useful for businesses. 

There are many reasons why businesses should consider investing in VoIP Phone systems. Some of them are – 

Allows multiple calls at a time 

One of the very important features of a VoIP system is that it makes communication a lot easier. It allows you to make multiple calls at the same time like conference and group calls. It also makes inter-department communication easier which in turn makes it easier for the customers to be connected to the desired department.


Whether your VoIP system is hardware-based or software-based, a major advantage of it over the traditional phones is its affordability. Since in both cases calls are made over the internet, you need not bear the cost of the call rates of telephone service providers. You would be able to place calls at significantly lower rates or even free. Installation of the hardware or software-based VoIP system is also hassle-free and doesn’t cost a fortune. If you choose a cloud-based VoIP system there is no need to install any extra equipment or appoint employees to install and maintain it. Even hardware-based VoIP systems need only the VoIP phones that are then connected to the router with an ethernet cable.


With VoIP, as your business grows it’s easy for you to add new lines for your employees. You can also eliminate existing lines as you downsize without having to bear any additional costs. Traditional phones would have required new lines with new cabling, with VoIP one can set up additional lines with a few clicks on their online dashboard.


VoIP provides one with ease to attend calls from anywhere they like. You don’t have to be chained to a desk to make and receive calls. With a VoIP system installed on your phone, tablet, or laptop you can take your work anywhere. It also makes it easy for businesses to allow for remote work for their employees. ( As we have seen the shift to remote work during the pandemic). It is surely the future of work.

Reporting and Metrics 

Using Landline telephones for business communications limits you from understanding the call metrics. With VoIP, one can easily track important metrics such as total call time, average handle time, hold time, etc. 

These will help you to understand how you can handle calls better. Customer experience can be significantly improved once you are able to measure your performance. 

Disadvantages of VoIP 

High reliability on the Internet 

As we discussed in the ‘what is VoIP section, VoIP places calls over the internet, so it goes without saying that having a strong internet connection is paramount to placing good quality calls. If the network bandwidth is low it will affect the service.

Delayed and Disorganised 

Sometimes when the VoIP system is used to send audio and video messages it might encounter some problems. This could be due to the delayed and disorganized assembly of the messages at the receiving end. It could be avoided with an optimal network bandwidth for transmitting messages. 

Does your business need a VoIP solution? 

If you wish to save costs in your office, then the short answer is yes. Lower operating cost with VoIP is the reason for potentially, more savings. Research shows that more than one-third of businesses are now using a VoIP phone system. It has been proven especially beneficial for small businesses. 

Determining if a VoIP phone system makes sense for a small business depends on the quality of its network and its need. All businesses need to be always available to attend to their customer communications and VoIP can prove hugely beneficial in this quest. 

You might think what VoIP phone features will prove beneficial for your business?  Let’s discuss it. 

Top VoIP phone system features

Once you’ve decided that a VoIP system is beneficial for your business, you might need to narrow down on the features you want. Here’s a list of features that Emitrr’s phone system offers : 

Automated Assistant

This assistant will help route incoming calls to the respective departments. Interactive Voice Response or IVR, allows for the execution of this feature. IVR comes with features like customizable greetings or the ability to route to multiple numbers.

Call Forwarding

This feature allows for unanswered calls to be automatically transferred to an available extension or phone number. It ensures that no customer call is left unanswered. 

Call Hold and Transfer

This feature will allow you to place a caller on hold or transfer to a different department or extension as needed. 

Call Recording 

Call recording is a VoIP module that allows workers to record calls for training and reference purposes. 

Call Pop 

Call pop is a feature that shows information about the incoming caller on the agents’ screen. Basic information such as name and phone number will be included along with other useful information. 


The voicemail feature allows callers to leave a voice message when their call goes unanswered. With Emitrr, these voice messages can also be transcripted and turned into text messages.

Call Routing

Call routing directs calls to a specific department according to the caller’s need. This is usually done by using the inputs dialed in by the user at the IVR to help map to the required department. Call routing reduces call hold time and thus improves customer satisfaction scores. There are different methods to call routing. These are: Round Robin, Regular, Simultaneous, and Weighted.

Call Notify

Call notify is setting up agent alerts for whenever a call is received. These alerts can be in the form of email or text messages. They help ensure that no call is missed and the agent is aware of the incoming call.

Call Queue

Call queuing is a very important feature for organizations that receive a lot of inbound calls. Call queue puts the callers into a queue based on when they called. These callers in the queue are usually welcomed with pre-recorded messages or on-hold music. Call queueing allows for proper distribution of calls


IVR stands for Interactive Voice Response. IVR allows callers to interact with an organization’s voice menu. By choosing options that are most suitable to the caller,  they will be able to resolve their queries quicker.

Is it easy to use VoIP?

If you have an active internet connection and an existing phone number all you have to do is pick a cloud telephony software and activate it for use.

Do You need a VoIP Phone?

If you choose Emitrr for your VoIP requirements, even if you do not have an existing landline number, Emitrr will help you activate one. 

Once it is activated all you have to do is go on the Emitrr dashboard and make a call to the desired number.  All call-related activities discussed in the section above are also simple to use and implement. Since it is a cloud telephony service, you do not need to have a VoIP-enabled phone to use the services. 

Does VoIP have an impact on internet speed?

Since you’re placing and receiving calls over the internet, you need to have a sound internet or broadband connection. With a decent connection, up-gradation to VoIP shouldn’t be affected. However, in the case of slow internet connectivity, you might not be able to use VoIP to its fullest potential. So, if you are upgrading to VoIP, make sure that you have a good internet connection. 

What should you look for in a VoIP provider?

Now that you are aware of all the functionalities, advantages, and disadvantages, and made a decision that you need to have VoIP services in your office, you need to look for a VoIP service provider. What are the things that you should keep in mind while narrowing down on a provider?


According to the needs of your office, make a note of all the features that you want to be implemented. Once that is done, you can go ahead and look at specific plans that each provider offers and choose the one which is most relevant to you.


 Switching to a VoIP system from the traditional phone system comes with huge cost savings. While each provider will have different feature packages, you need to see which one fits you best. Look carefully at the included features. Some providers may charge extra for features that others include. When comparing providers, it’s important to know what features your business needs, and what features you can skip.

Customer Support

VoIP is a medium for important client communication, if a hindrance is identified in this medium it should be taken care of right away. Therefore it’s important to narrow down on a service provider that offers support 24 hours a day, 7 days a week, like Emitrr. Having customer support available when you need it is extremely important. 

Third-Party Integrations

It’s important that the VoIP system you use is able to integrate with the tools you already use. When finalizing a provider, make sure to check if your required integrations are offered or if they can be integrated later on.  For example, Emitrr integrates with over 1000+ CRMs to make data migration easy. 

VOIP Regulation and fee

Before you finalize on a VOIP service provider it is good to have a know-how of the regulations and prices one must expect. The final price of the VoIP service depends on a number of factors such as the price of hardware and initial setup, the number of users, features, hosting, and subscription package.

VoIP services are regulated by the Federal Communications Commission or the FCC. The regulations are based on the fee structure, law enforcement, etc.
The main points of regulation include :

Emergency Services (E911) – Providers of interconnected VoIP services must comply with the Enhanced 911 system, delivering both landline routing and location transmission.

Portability – ITSPs are obligated to comply with Local Number Portability (LNP) rules.

Calling Records – The FCC limits the use of customer proprietary network information such as telephone calling records, and ITSPs are required to protect such information from disclosure.

Universal Service and Accessibility – ITSPs are required to contribute to various funds that are used to support services to high-cost remote areas, low-income telephone subscribers, and provisioning for telecom services to persons with speech or hearing disabilities.  (Teledynamics)

Does the FCC Regulate VoIP?

The Federal Communications Commission is in charge of regulating anything and everything related to communications, across various industries. It is the degree of control that varies. In the case of VOIP, the FCC regulates it to a certain degree. 

According to FCC, VoIP is a technology that is used for communication through an internet protocol, in sharp contrast to analog systems. The FCC does have a couple of policies pertaining to VoIP in place that focus on adhering to privacy as well as the accessibility of service. 

For interconnected VoIP services, the FCC defines those services to be real-time communications that are two-way, requiring broadband connection and equipment that is IP compatible, and allow subscribers to place and receive calls with the Public Switched Telephone Network. 

All the interconnected VoIP providers are required to fill and submit the FCC Form 499-A which will register them with the FCC as well as the USAC, giving them the status of interstate providers in the USA. 

VoIP vs SIP vs PBX: what’s the difference??

If we talk about SIP, VOIP, and PBX; it would be unfair to do a straightforward comparison, as, in reality, these three are inter-related. All of these cater to the requirements of the present business landscape and provide cutting-edge communication. 

Session Initiation Protocol (SIP) locates devices on a network and connects the required parties. It uses the Signaling Protocol also known as trunking to connect one device to another prior to establishing a connection. It allows seamless communication across the world, whether people are using desk phones, computers, or mobile phones. 

Private Branch Exchange (PBX) is a business-grade phone system that features communication for internal as well as external usage. Its top features include call conferencing, extension dial, waiting for queues, and call re-routers. 

VOIP, as discussed earlier, is a system that initiates calls over the internet and allows the digital transmission of video and voice signals. For this, the businesses need to have a VoIP-enabled phone system and VoIP software. VoIP eliminates the need of having a physical phone system in the office.  


1. What kind of Internet connection do I need for VoIP?

You will need a broadband Internet connection such as DSL or Cable or others (T1, wireless, etc.).

2. Is the voice quality good with VoIP?

The voice quality is good, although it depends on factors such as speed, the bandwidth available, internet connection, etc.

3. Can I keep my existing phone number?

Yes, most VoIP service providers like Emitrr allow you to port your existing phone numbers.

4. Do I need to have an existing phone number?

Even if you do not have an existing phone number, you can either buy or lease one from your VoIP service provider.

5. Can I  use my computer while on a VoIP call

Yes, you can work on your computer and attend calls simultaneously. One will not interfere with the other.

6. How much does VoIP cost?

If we talk about costs per extension, then the range is between $100-$500. The ongoing costs include service fees and maintenance costs of around $10-$25 per extension on a monthly basis. 


If you are a business owner looking to streamline communications over the internet, then asking the question ‘what is VoIP’ will help you a lot with customer calls.

Of the many advantages of VoIP, increased connectivity, better clarity, mobility and scalability along with cost advantages make it a very useful capability to have.

If your business receives a lot of calls then having the capability to answer the calls from anywhere is of paramount importance. A business cannot afford to miss calls just because they are travelling, or away from the desk. In present times, one needs to be available everywhere and that is exactly what your customers also expect from you. This is where VoIP services can help you. It allows for placing calls over the internet which means that as long as you have an internet connection, you can be assured that every customer call reaches you and you are able to answer it. Whether it be through your landline, mobile or desktop. Learn more about how you can use VoIP in your office by visiting www.emitrr.com

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