Businesses have for some time now been utilizing voice over IP telephony through the building of converged networks. As VoIP technology matures and the network pipe grows ever larger, LANs that existed primarily for data transmission are being converted to handle all types of media based on the Internet Protocol. With a well established infrastructure of fiber optic trunk lines, wide area networks can carry much more traffic at much higher speeds than they could have in the early nineties. The next step in the evolution of networking for businesses large and small is one network that handles transmissions of data, video, and voice. The converged network.

The same can now be said for the modern residential household. As more of us are building our own local area networks at home to connect our family members to each others data and appliances, broadband connections to the outside world have expanded our pipe to the Internet, giving us plenty of bandwidth to consider converging our home network with voice over IP telephony.

But why switch? When one considers the services and costs offered by VoIP providers compared to traditional telephone companies, the reasons are compelling.

First and foremost, the financial savings of talking on the Internet, as opposed to using the telcos copper lines, can be significant. In some cases up to 60%. This is best illustrated with long distance calls. As calls are routed over the Internet, they will indeed eventually be switched over to landlines, but not until they reach their destinations local switching station. To the telephone company, this looks like a local call and is thus free.

Pretty much all VoIP service providers offer free calls within the U.S. and Canada, with some including Puerto Rico and even certain destinations in Europe. International rates are significantly lower than telco rates and many destinations are as low as 1 or 2 cents a minute. Rates may jump when crossing over to a cell phone network, but are still the lowest to be had.

Different countries handle VoIP calls and rates differently. Panama taxes VoIP calls as do many other countries that have a nationalized telecommunications industry. Even so, International rates have never been as low. Its just much more cost efficient to route calls over the Internet.

Much like the cell phone industry, most pure play VoIP providers such as Vonage or Packet8 offer various calling plans to suit your individual needs. NetZero offers one of the lowest plans with 100 minutes for $3.95 a month. Vonage has a 500 minute plan for about $15 and Packet8 has unlimited minutes for $20. Even the cell phone companies with their free in network calls cant compete price wise.

Services provided by Vonage and others compare favorably to local phone companies. Voice mail, call waiting, caller ID, call forwarding, and 3-way calling are standard features with most providers, whereas a local phone company may bundle these features and charge for them. Local number porting allows you to transfer your existing phone number in most cases and premium features such as multiple phone numbers and toll free 800 numbers can be had for around $5 a month.

Some services not offered by the phone companies are the virtual phone number, allowing you to have numbers in different area codes, and voice mail to e mail which lets you check your messages from a computer. In fact, many providers offer a soft phone, a software application that turns your laptop, PC or MAC, into a video/telecommunications center.

Voice over IP Telephony may not be for everybody. There are some disadvantages that we will cover in the next article, Things to Consider Before Switching. But if you are tired of $80 phone bills, and of being nickled and dimed for every little add on, then VoIP is definitely a new consumer technology that you should look into.