PBX, VoIP and SIP Systems.

Internet Phone Service Providers

What is: Voice Over IP, SIP Telephony, Cellular VoIP, Broadband Business PBX?

Voice Over IP Service

Voice over IP(VoIP), is the technology of sending internet phone calls over the internet in packets of information, instead of down a conventional land line. Internet phone service requires a high speed internet connection and a broadband phone service provider. The customer uses a router that is sent to them from their VoIP carrier, and plugs it into his or her home network. A regular telephone is then plugged into the system and works just like plain old telephone service(POTS).

The advantage of VoIP service is that telephone calls made over a VoIP system are much cheaper than phone calls made over a land line. Land line phone calls have at least 3 points of cost that don't always apply to voice over IP calls. Those three points are:

  1. Local origination fees.
    • Fees collected by the local telephone company to originate the call.
  2. Long distance fees.
    • Line rental fees charged by the major telecommunications companies who own their own lines. Since most companies don't own their own lines, they have to rent time from the big carriers like AT&T, Bell South and Qwest.
  3. Termination fees.
    • These are the fees charged by the local telephone company on the terminating end of the call. Some voice over ip companies have their own local POPs (Point of Presence) in some areas, but many times the VoIP company ends up having to pay termination fees to the local phone company to get the call connected.

One of the disadvantages to using internet phone service is that if your high speed internet service goes down, or just slows down, your VoIP service won't work. Another problem that can happen is that the packets can get sidetracked or log-jammed during busy times of the day, or where there just isn't enough bandwidth to handle all the traffic going over the system. This can make the calls echo or make them drag, so that there are noticeable delays in the conversation.

SIP Telephony

While regular broadband phone service uses a router and a normal phone system, SIP Telephony services are computer based and don't require a router to use. SIP systems are software driven and reside completely on your computer. These "Softphone" systems let you plug your headset and microphone into your computer and use it just like you would a regular land line or VoIP system.


Companies are now also making USB IP Phones for the softphone market, which should increase the acceptance of SIP dramatically over the next few years. USB IP Phones will make the mobile office just that much better. Now anyone with a laptop can plug in their IP phone anywhere they can find a land line or WiFi high speed internet connection. once the connection is enabled, they can receive phone calls no matter where they are in the world, even if they're sitting at a McDonalds in Beijing.


Here's a personal example:
I went to Mexico for a month a couple of years ago. I was in a little town way down the Baja coast and there were only 2 places in town with WiFi. Well, I worked in a local bar for a month, drinking Modello Negro and smoking $1.75 a pack Marlboro's all day long, while doing business with customers back in the States. They didn't know I was in Mexico, and they probably didn't know I was drunk... well maybe. All they really knew is that they called my office phone number in San Francisco, and I answered the phone. The dang thing worked like a charm.


As far as that goes, SIP systems will work both ways. What I mean by that is that I could call anyone in the US for free because I had a US account and phone number. The system didn't care that I was in Mexico, all they saw was my US number and all my calls to the US were free. I'm pretty sure the Mexican Government would have liked it a lot better if I had called the United States through their phone system so that they could have charged me $4.00 a minute. (That's what it cost from my hotel...)


There are also stories all over the net of criminal organizations using VoIP systems to run scams. They will have an agent open a bunch of VoIP accounts with local United States telephone numbers. The adapters are then sent to whichever country the criminal organization is based in, and the crimes begin. They run variation of credit card scams and social engineering scams such as identity theft and bank account fraud. The Nigerians used to just run their scams online, via snail mail and fax machines, but now they can run them via phone without running up a big phone bill.


Cellular VoIP & WiFi

Wireless carriers have been joining the ranks of VoIP users lately in droves. It's way cheaper to transfer calls from a cell tower onto the net via a VoIP system that it is to transfer that same call into the land-line system. So, now you won't know if your cell phone reception is bad because you have a lousy signal from the tower, or because the call is backed up on the net.


While cellular companies are making more money off of their customers by using VoIP instead of land lines, their customers are using a combination of WiFi and VoIP to do lower their monthly cell phone bills. If a customer has a WiFi enabled phone, there is software that they can download from the internet that will let them hack into their phones and reset some of the manufacturers setting. One of the things they can do is set their phones to bypass their cell carriers local tower when a WiFi connection is available. By doing this, they can reduce their monthly billable minutes of usage.


As more software based cell phone systems become available, like the iPhone and Google's new Android System, and more and more programs and applications are written for these phones, most experts expect cell phone companies to move away from a per minute based cellular system. This will happen because eventually, as more and more people hack their phones, the cell carrier's billable minutes will decline. We have already seen the start of this with the introduction, by Sprint, of unlimited minutes and downloads for $99.00 per month.

Business PBX and VoIP

A PBX system is a Private Branch Exchange. This is a system that has been developed for business users so that they can have all of the services usually associated with a large corporate environment, but at a much lower cost. VoIP PBX systems have all the bells and whistles that large companies have come to expect, like multiple user accounts, voice mail, music on hold and many other really cool options. Since all of these services and options are software based in a VoIP PBX system, they can be upgraded and added to at any time for just a fraction of the cost associates with a corporate land line system.


With a VoIP PBX system, a small company can have the look and feel of a large corporation at just a fraction of the cost. They can also get a high rent area code in New York or LA, while having workers work from home all over the world. This type of diversification lends itself better to our ever changing world than do land line systems. With call forwarding to cell phones and home phones, simultaneous ring and other options, small companies can make sure that their phones are always answered.


I've used a version of this for years with my businesses. I can get online, log into my PBX account and shift phone from one person to the next, set the corporate numbers to ring in on my cell phone or have everything sent to voice-mail where it is then emailed as a voice recording to my in-box. If I'm at my computer, I can even see whose calling via my pop-up caller ID before I answer the phone. In my opinion, voice over IP PBX systems will replace land line systems over the next few years in most of corporate America. With their ease of use and savings of over 90% in some areas of the country, VoIP PBX just makes sense if you want to compete in today's global market.


VoIP's Future in the Telecommunications Industry

As we can see from the above discussion, VoIP is set to eventually take over all of the telecommunications markets. Companies like AT&T and Qwest will have to move into the triple play and grand slam environments of bundled high speed internet service, television programming, cell phone service as well as residential and business phone service, to be able to compete in the new telecom marketplace. Telecom companies will be able to make money, but they will have to bundle services into attractive and low cost groupings to entice consumers to use their services.


Eventually, VoIP will be used to transmit television shows, movies, cell phone calls, residential calls, business PBX calls and more. With the increase in bandwidth now available, daily advances in compression technology and American's appetites for more services for less money, there isn't any way for the old telecom companies to last agents internet phone service, except to get on the VoIP wagon and ride along with the rest of us.