VoIP services – How does it work?

The world over, communication – reliable and secure – is taking on a more critical role in the functioning of organizations and businesses. The more geographically spread your organization is, the more important it becomes to keep communication networks up and running.

Voice Over Internet Protocol (VoIP) has gained tremendous traction over the last decade and has become a popular choice for organizations looking for cost-effective and reliable communication networks to manage their growing business – VoIP services market is predicted to expand 10 % every year until 2021 and touch $140 billion.

What is VoIP (Voice over Internet Protocol)?

VoIP services use Internet connections to make phone calls. The analog voice signal is turned into data packets and transmitted over the Internet, enterprise local networks or Wide area networks. Apart from voice data, VoIP also transmits multimedia content over IP networks.

How does VoIP work?

VoIP has become an increasingly popular choice for business communications and provides a stable alternative for traditional telephone networks known as Public Switched Telephone Networks(PSTN).

VoIP provides a reliable and secure communication channel with highly cost-effective models. To understand how VoIP can achieve this, one needs to look at the technology behind the services.

VoIP uses a codec to encapsulate audio into data packets and transmits them across an IP network and decapsulates them back into audio at the other end of the connection. VoIP uses standard codecs by the International Telecommunication Union, such as G.711 for transmitting uncompressed packets, or G.729 for compressed packets. This compression is typically used to decrease bandwidth requirements.

After it is encapsulated onto IP, voice data is transmitted via the real-time transport protocol or through its encrypted variant, secure real-time transport protocol. The most common communication protocol is Session Initiation Protocol (SIP) and is used for signaling that is necessary to create, maintain and end calls.

In an enterprise setup, VoIP emulates the traditional telephone networks with dedicated instruments – endpoints include applications running on mobile devices or dedicated desktop VoIP phones. VoIP is also available as a computer to computer service wherein you don’t need any extra hardware – calls can be made directly from the computer with just a microphone or a soundcard – the most popular example of this is Skype!

In many organizations, there may be an existing PBX system and VoIP system can use a SIP codec to connect with the PBX and allow it to manage user phone numbers; gateways to connect networks and provide failover in the event of a network outage.

VoIP networks have several other components such as session border controllers to provide security, call-policy management and inter-operator network connections. VoIP also has a host of additional functionalities which help users and management to operate smoothly – these are location-tracking databases for call routing and management platforms to collect call-performance statistics for voice-quality management.


A peek into the VoIP technology lays bare the reason for its popularity, especially among businesses – while cost savings may be one of the main reasons for migrating to VoIP (on an average, businesses can save between 50 – 75 % after switching to VoIP), businesses have consistently seen enormous jumps in productivity thanks to additional functionalities such as unified communication and telecommuting. In the current market scenario, where customers expect quick responses and a seamless customer experience is key to business success, VoIP has quickly become the only communication choice for most organizations.

As India’s first ICT Company to be listed on NASDAQ, Sify has years of experience in providing reliable and secure Network Integration services to enterprises across industry verticals.

Our cutting-edge networking services ensure reliable data connectivity services as well as the best-in-class Voice services in India – all available as cost-effective payment models aligned to scale with the growing needs of individual businesses.

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