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Its advantages over traditional telephony include:
Voice over IP traffic does not necessarily have to travel over the public Internet; it may also be deployed on private IP networks for example on a LAN inside a single building.
The protocols used to carry the signal over the IP network are commonly referred to as Voice over IP or VoIP protocols.
Although few office environments and even fewer homes use a pure VoIP infrastructure, telecommunications providers routinely use IP telephony, often over a dedicated IP network, to connect between their switching stations, where they convert the dedicated voice signal to IP packets and back. The result is a data-abstracted digital network which the provider can easily upgrade and use for multiple purposes.
Corporate customer support centers which provide support over telephone often use IP telephony exclusively to take advantage of the data abstraction that comes with it.
The benefit of using this technology is the need for only one class of circuit connection and better use of the available bandwidth. IP telephony is commonly used to route traffic that may be originated from and terminated at conventional PSTN (Public Switched Telephone Network) telephones.
VoIP is now widely deployed by carriers, especially for international telephone calls. Users are typically completely unaware that their telephone call is being routed over IP infrastructure for most of its distance instead of the circuit switched PSTN.
VoIP is also used by large companies to eliminate call charges between their offices, by using their data network to carry inter-office calls. They may also use VoIP to reduce the costs of calls outside the company by carrying them to the nearest point on their network before handing them off to the PSTN.
There are companies which offer a gateway to the PSTN from any VoIP phone. You can simply dial a conventional telephone number and the telephone call will be routed over your internet connection to the company that operates the gateway, and they will bill you, not the local phone company.
Electronic Numbering (ENUM) makes it possible to dial traditional E.164 phone numbers, but be connected entirely over the Internet if the other party uses Enum, so you do not incur any expenses aside from the Internet connection fee. It's also possible for companies to buy their own gateway to eliminate costs of a third party, which can be cost effective in some situations.Because IP does not by default provide any mechanism to ensure that data packets are delivered in sequential order, or provide any Quality of Service guarantees, implementations of VoIP face problems dealing with latency and possible data integrity problems.
One of the central challenges for VoIP implementers is restructuring streams of received IP packets, which can come in any order and have packets missing, to ensure that the ensuing audio stream maintains a proper time consistency. Another important challenge is keeping packet latency down to acceptable levels so that users do not experience significant lag time in the conversation.
Solutions to these problems:
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