Voice over Internet Protocol, also called VoIP, IP Telephony, is the routing of voice conversations over the Internet or through any other IP-based network.
Some cost savings are due to utilizing a single network to carry voice and data, especially where users have existing underutilized network capacity they can use for VoIP at no additional cost. VoIP to VoIP phone calls on any provider are typically free, while VoIP to PSTN (Public switched telephone network) calls generally costs the VoIP user.
There are two types of PSTN to VoIP services: DID (Direct Inward Dialing) and access numbers. DID will connect the caller directly to the VoIP user while access numbers require the caller to input the extension number of the VoIP user. Access numbers are usually charged as a local call to the caller and free to the VoIP user, while DID usually has a monthly fee. There are also DID that are free to the VoIP user but is chargeable to the caller.
Legal Issues
As the popularity of VoIP grows, and PSTN users switch to VoIP in increasing numbers, governments are becoming more interested in regulating VoIP in a manner similar to legacy PSTN services.
In the U.S., the Federal Communications Commission now requires all VoIP operators who do not support Enhanced 911 to attach a sticker warning that traditional 911 services aren't available. The FCC recently required VoIP operators to support CALEA wiretap functionality. The Telecommunications Act of 2005 proposes adding more traditional PSTN regulations, such as local number portability and universal service fees. Other future legal issues are likely to include laws against wiretapping and network neutrality. As for the European Union, treatment of VoIP service providers is a decision for each Member State's national telecoms regulator, which must use competition law theory to define relevant national markets and then determine whether any service provider on those national markets has "significant market power" (and so should be subject to certain obligations). A general distinction is usually made between VoIP services that function over managed networks (via broadband connections) and VoIP services that function over unmanaged networks (essentially, the Internet).
Links of Interest
http://www.skype.com/
http://www.voip-info.org/wiki/
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