VoIP Phone Service uses the existing infrastructure already installed for the Internet and speech signals converted to digital audio are sent in the form of packets. VoIP services can be interfaced with the Public Switched Telephone Network (PSTN) and calls can be made to another computer, mobile phone VoIP phone or an ordinary telephone.
The services provided by VoIP are similar to those provided by PSTN with call forwarding, call waiting, caller identification, automatic redial and conference call facilities on offer. VoIP has an advantage over regular telephony in terms of security - the audio content is split into multiple pieces of very short duration and sent over the Internet as packets. The packets need not be received at intermediate points in sequence. It is very difficult for anyone to intercept a conversation being carried on VoIP.
VoIP has become very popular over the last few years as it has become a low-cost voice communication solution with wide user acceptance and a large consumer base. The service providers do not have to bear the expenses of installing infrastructure in the form of cables and switching equipment as the Internet infrastructure is already in place. In PSTN, the service provides is required to digitize voice and transmit the data after conversion to digital signals. The Internet infrastructure already carries signals of this nature and this reduces the cost for service providers significantly. This extends VoIP telephone services to the customer at much more economical rates than PSTN.
Another benefit of VoIP service is that it makes your physical location immaterial. All you need is access to a computer to be able to call any number of your choice, even international numbers for the cost of a local call.
There are downsides to VoIP services - Internet traffic is inherently unreliable in nature and in congested networks, the chances of dropped packets are very high. In such conditions, dropouts in conversation are inevitable. This is in contrast to the dedicated and reliable channel of communication provided by PSTN. For the same reasons, VoIP telephone services are unable to match the Quality of Service (QoS) guarantees provided by the PSTN.