How VoIP Works

How VoIP Works, and Why it’s Better for Your Business

Daniel WeissLast updated on January 2, 2024
3 min

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You may not be aware of it, but the world of telephony is undergoing a drastic transition: From classic phone technology to voice over internet protocol (VoIP).

At Aircall, it’s our duty as professionals working in this space to help you understand how this technology works, and why it’s better for your business on the whole.

The underlying technology behind VoIP phone calls is technically complicated, but if you’re able to understand how it works from a high level, it’s easy to see the benefits.

Quick Links

  1. Business Telephony Before VoIP

  2. How VoIP Works

  3. Connecting VoIP Phones with Classic Phones (and Phone Numbers)

  4. Why VoIP is Better for Businesses

Business Telephony Before VoIP

Phones are great because they take human voice, convert it into electrical signals, transmit those electrical signals at near light-speed over vast distances, and revert them back into an intelligible voice. It makes nearly instant communication possible despite remote locations and vast distances.

But as recently as 15 years ago, long-distance calls were very expensive.

That’s because your voice was traveling through a network of copper wires.

During these analog telephone calls, your voice was traveling through a switched telephone network. When you were on the phone, the wires transmitting your call were dedicated exclusively to your conversation.

For example, when you called someone long distance in New York from Los Angeles, you were essentially “renting” 2,000 miles of wiring. Competition for these wires let phone companies drive up the cost of long-distance phone calls.

Power Dialers

How VoIP Works

VoIP uses the “everywhere, all the time” potential of internet protocol to achieve the same end result, albeit in a different way.

When you speak into your computer’s microphone, your voice is detected as physical sound waves and converted into an electrical signal using a piece of hardware called a driver.  Then, pieces of software known as voice codecs (coder-decoders) convert this electrical signal into binary data.

From here, your operating system separates binary data into smaller pieces of information known as packets. These packets of audio information are transmitted…

  • from your computer

  • via the router

  • through copper or fiber optic cables

  • across the world to another computer

  • reverse processed via that computer’s codec…

… back into what you recognize as words.

Furthermore, analog telephone technology had to send information in a relatively slow, linear fashion. The internet can send these packets much faster by doing so in any order, known as packet switching.

Packets are reassembled in the correct order when they arrive at their destination (your IP address). This increases the speed of delivery over analog telephones and reduces costs since no exclusive wire has to be designated.


Connecting VoIP Phones to Classic Phones and Phone Numbers

VoIP to VoIP only describes a specific type of voice conversation where an internet-connected device knows it’s calling another internet connected device. Examples of this include Facetime Audio and Google Calls.

In order for VoIP software to call an analog phone (landline) or cell phone (that is to say, any phone with an actual number), additional steps must be taken.

Programming specifics and scientific language aside, VoIP software can do this by directing calls through carrier companies like Voxbone, Twilio, Plivo, etc.

These companies have physical “Points Of Presence” around the globe that receive web-based audio packets (using a protocol known as WebRTC), convert them into the type of signal acceptable to classic phones (known as SIP), and vice-versa.

If a call coming from a VoIP phone needs to be directed to a cell phone or landline, these carriers fulfill that function.

The same process occurs when an analog phone calls a VoIP software. These carriers sell telephone numbers which are associated with VoIP phones, making them accessible via classic phones as well.

Carriers must process all calls to internet protocol phones affiliated with a “real” phone number. So long as phones and phone numbers are the preferred means of voice communication, this is necessary.

Why VoIP is Better for Your Business

Internet Protocol Makes International Calls Cheaper

VoIP phone systems avoid the exorbitant pricing of traditional phone services by using packets and internet protocol instead of analog telephone lines (copper wire). Digital signals sent via broadband avoid “rental” costs typically associated with long-distance PSTN phone calls.

VoIP Software is Mobile

Switching to VoIP also allows for much greater mobility in the workplace. The desk phone (as an anchor) is a thing of the past. Plus, internet protocol technologies are accessible via any internet-connected device, so remote work is also possible.

VoIP Increases Agent Knowledge and Productivity

Finally, VoIP telephony can be intricately connected to your other cloud-based technologies. Unified communications solutions — like customer management, sales, chat, and email tools — are just the beginning. This connectivity makes for better tracking, informed conversations, and a more productive workforce.

For more on VoIP phone software and unified communications, check out these other articles on the Aircall blog.

Published on December 4, 2018.

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