Why is IP telephony so cheap?

To answer this question, let’s talk about the expenses involved in switched circuit communications. Earlier on in the history of conventional telephony, in the mid-1960s, each call needed a dedicated cable going from one end of the communication to the other, for as long as it lasted. So if a person located in Canada had to make a call to another person in England, the operators in your phone company would connect cables along the entire route to form a path between the two ends of the communication.

In this case, if the call lasted 10 minutes, these switched cables running along the entire route between Canada and England would be used during the length of the conversation. This made long-distance communications very expensive.

Switching circuits today

Today, telephone communications are much more efficient and that’s why they cost less. The voices are digitized, and your voice can travel along with many other through a fiber optic cable for most of the way -there is still a dedicated piece of wire, which goes right into your home-. Those calls are transmitted at a quality of 64kb per second (kbps) in each direction, for a total transmission of 128kb (64kb back and forth). As there are 8Kb in a kilobyte (KB), this translates to a transmission of 16KB for each second that the circuit is open, and 960KB for every minute. Then, in a communication of 10 minutes, the total amount of transmitted data would be 9,600KB, which is roughly equivalent to 10 megs. If you looked at a typical conversation, you would easily realize that much of this information is wasted.

Downtime in communications

When you’re talking, the other party is listening, which means that only half of the connection is in use at a given time. Based on that, we can deduce that the size of the conversation could be cut in half, just 4.7MB while maintaining the same quality of communication.

In addition, a large amount of time in conversations is dead time, time in which neither party speaks. If we could remove these time intervals, the size of the conversation would be even smaller. So instead of sending a continuous stream of bits -both of silence or noise-, what if we only sent packets whenever noise occurred, when created? That is the basis of packet exchange, the alternative to packet switching.

The advantages of IP telephony: why use VoIP?

The first and most important advantage is the cost. A call using VoIP telephony is, most of the time, much cheaper than its equivalent in the case of conventional telephony. This is basically because the same network for voice and data transmission is used. Conventional telephony has fixed costs that the IP telephony hasn’t, hence it is cheaper. Usually a call between two IP phones is free, whereas if call is made from an IP phone to a conventional one, the cost is borne by the IP phone.

There are other advantages, other than the cost, to choose IP telephony:

  • With VoIP you can make a call from anywhere if there is Internet connectivity. Since IP phones transmit information through the Internet, they can be managed by a provider from wherever a connection is made. This is an advantage for people who travel a lot, they can carry their phone with them all the time and still have access to their IP telephony service.

  • Most VoIP providers deliver features for which conventional telephony operators charge extra fees. A VoIP service includes:
    • Caller ID
    • Call waiting service
    • Call transfer service
    • Redial
    • Call back
    • Three-way calling

  • Based on the caller ID service, advanced features also exist regarding how calls from a particular phone are answered. For example, within a single VoIP phone call you can:
    • Forward the call to a specific phone
    • Send the call directly to voicemail
    • Give the caller a busy signal
    • Display an “out of service” message
Voice:data IP telephony interface terminal_donald burns_VoIP
Image courtesy of Calvin Kim at Flickr.com

Disadvantages of IP telephony

Even today, there are problems in using VoIP, and it is clear that these problems are the result of technological limitations and will be resolved in the short term by the constant evolution of technology. However, some of these still persist and are listed below:

  • VoIP requires a broadband connection. Even today, with the constant expansion of broadband connections, some households still have modem connections, and this type of connectivity is not enough to keep a fluent conversation via VoIP. However, this problem will be solved by the sustained growth of broadband connections.

  • VoIP requires an electrical connection. In the case of a power failure, unlike VoIP phones, conventional phones would still work, as long as they’re not cordless. This happens because the phone line is everything a conventional phone needs to function.

  • Calls to emergency numbers: These are also a problem with a VoIP phone system. As is known, the IP telephony uses IP addresses to identify a particular phone number, the problem is that there is no reliable way to associate an IP address to a geographic area. Since each geographic location has a particular number for emergencies, it is not possible to establish a relationship between a phone number and its corresponding sector in an emergency line.

  • Since VoIP uses a network connection, the quality of service is affected by the quality of the data line, which means that the quality of a VoIP connection can be affected by problems such as high latency (response time) or packet loss. Telephone conversations can be distorted or even cut by such problems. To establish satisfactory VoIP conversations, it is essential to have certain stability and quality of the data line.

Anyway, as the technology evolves, IP telephony will overcome these problems, and will likely replace conventional telephony in the short term.


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