What is Internet Protocol Telephony (IP Telephony)?

December 14, 2021
What is Internet Protocol Telephony (IP Telephony) - featured image

Internet Protocol Telephony, or IP Telephony, is the use of traditional telephonic communication through the internet. It uses IP-based networks that can collect, convert and store voice data for transfer from one user to another. These IP-based networks are run via an Internet service provider (ISP) or from a telecommunications provider. IP Telephony is also known as Voice over Internet Protocol (VoIP).

What is IP Telephony

What does IP telephony mean?

IP telephony is a universal term that refers to any phone system that uses the Internet Protocol. It uses packet-switched connections to enable voice calls, voicemails, video calls, video conferences, instant messaging (IM), and even faxing. It is an upgrade from the traditional circuit-switched connections of public switched telephone networks (PTSN).

Internet Protocol Telephony works by taking invoice information and transforming that into small packets of data. These packets then travel through the internet using packet-switched connections. When the data is sent to a receiver it is converted to voice either in the form of direct conversation or it can be stored when using features like call recording. Voice calls and voicemail, which are both features of IP telephony, are also referred to as voice over IP (VoIP).

The VoIP application Speak Freely was created in 1991. It was the first VoIP released to the public during the emergence of IP telephony. The following year, Communique, which allows desktop video conferencing, was released by InSoft. And in 1995, VoIP was standardized by Intel, Microsoft, and Radvision.

Check out our other article How To Connect Phone To Ethernet

Features of IP Telephony

What are the features of IP telephony?

  • Gatekeeper: Up to 360 IP extensions can be added through the Integral IP office. This number is less than that of traditional and digital telephones.
  • Silence Suppression: Silence suppression sends a description of the sound instead of the actual sound itself. It is used to optimize the use of bandwidth by reducing the packet size needed.
  • Fast Start: With the use of an IP extension, Fast Start allows the audio path to be made quickly when answering calls by reducing protocol overhead.
  • Local Hold Music: By using the bandwidth of the LAN to allow the IP endpoint to generate its own, this provides music from the IP Office.
  • Local Tones: By using the bandwidth of the LAN to allow the IP endpoint to generate its own, this allows the use of supervision tones from the IP Office.
  • Out of Band DTMF: If set up, DTMF tones can be generated from the IP office using an IP extension.
  • Direct Media Path: This allows direct routing between two IP extensions. This improves the effectiveness of the IP Office system by freeing voice compression resources.
  • Auto-Create Extensions: This feature allows the automated creation of extension entry so new extensions can be added to the local area network. This feature can be disabled depending on the security of the facility.
  • Fax Over IP: Fax Over IP allows routing of incoming and outgoing calls to a fax machine. These fax machines are usually connected to remote IP offices.
  • ACD: Automated call distribution system – also known as automatic call distributor, is a device used in IP telephony. It responds to and distributes incoming calls to a particular terminal or to the person who would handle the call.

Related Reading: Automated Answering Services

What is the purpose of IP telephony_

What is the purpose of IP telephony?

The goal of IP telephony is to rework and improve telecommunication as we know it. This is accomplished by replacing the telecommunications infrastructure itself. Through the use of packet-switched IP communication networks both circuit-switched public data networks (CSPDN) and public switched telephone networks (PSTN) are replaced.

For consumers, IP telephony usually goes in the form of IP softphone applications. This provides access to calling and faxing by making use of a backend internet connection. Users are then able to use voice and data communication with circuit switches and cellular communication services.

For businesses, IP telephony comes in the form of IP phones. These physical phones work on an existing IP network structure and provide full functionality. Features include managing and initiating telephonic communication as well as supporting video communication between two users or a group of users.

Voice over Internet Protocol (VoIP) is a well-known part of IP telephony.  It facilitates voice communication only through IP.

Benefits of Internet telephony in businesses

What are the benefits of IP Telephony for businesses?

Organizations of all sizes can benefit from using IP telephony services. IP telephony offers the following:

    • No need to maintain two networks. Through the use of IP telephony, businesses don’t need to arrange and maintain two separate networks for internet and phone use.
    •  Lower costs. IP telephony is substantially less expensive to run than wired phone services. It is also more cost-efficient when used for long-distance and international calls.
    • Streamlined infrastructure. IP telephone systems are highly flexible.  They can integrate with existing infrastructures. It works through business applications and can provide features such as sending and receiving faxes through email.
    • Scalability. It is easier to deploy telephone lines through an online interface than it is to install new wired phone lines.
    • Mobility. IP phones can be accessed through portable computers and mobile devices. It is not confined to a physical office.
    • Better Call Flow. By using methods that surpass traditional routing and queuing, VoIP systems improve parts of the call flow. An example of this is automatically prioritizing calls based on queue time.

We invite you to check out our other article: Customer Service Process Flow

What are the challenges of using internet telephony

What are the challenges of IP telephony?

Even though IP telephony offers an array of features and provides many benefits, it does have a few drawbacks:

  • Problems with 911 calls. The Federal Communications Commission requires VoIP to offer 911 as a standard feature. However, if callers fail to give a physical address to their provider, the calls may not register the caller’s phone number information and location.
  • Server latency. Since disruption in internet connection strength can lead to server latency, having a high-speed internet connection is a necessity.
  • Power requirements. During blackouts or power outages, IP telephony systems will not work.

Read more: Why is Call Flow Important

Difference between VoIP and IP telephony_

What is the difference between VoIP and IP telephony?

IP telephony and VoIP are very similar terms that are used interchangeably. It’s not considered wrong to use the two synonymously because the two terms overlap. However, although both use a local area network (LAN) to connect to the internet via a router the two are defined as follows:

  • VoIP specifically describes standardized modern VoIP phones. It runs through an IP-based network and delivers voice-based features such as voice mailing and calling.
  • IP Telephony is a broad term that encompasses technology, features, and products with either voice-based or non-voice-based features such as IM.

 Related: Analog Phone System

How does Internet Protocol telephony work_

How does Internet Protocol telephony work?

Using Internet Protocol (IP) or other digital protocols, IP telephony transfers voice communications through the internet. By using an IP PBX system, digital data goes through the Local Area Network (LAN). This data is then converted into analog voice signals and sent to the PSTN. However, since IP PBX hardware installation is costly, it is no longer the best solution.


Further reading: How does VoLTE Work?

IP Telephony - Summary


Through the use of advanced PBX features Hosted VoIP has taken the place of IP PBX and has become the most popular IP telephony solution. Without the need to be installed on-site, hosted VoIP offers an array of features such as call routing, call queuing, and even utilizing the cloud. It can also compensate for missing features by SIP trunking to a legacy PBX and then connecting to a modern VoIP provider.

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