How Does VoIP (Voice Over IP) Actually Work?

With Voice over Internet Protocol (VoIP), a caller's number is linked to their IP address, their unique location on the internet. Instead of routing the voice call over a standard landline, VoIP works by converting the voice signal into data packets. These data packets then travel down the caller's broadband connection, across the internet, until they reach the recipient's IP address.

The clever bit happens at this point when all the data packages of voice signals are unpacked and reassembled into a complete voice signal. This is, of course, a two-way process that allows users to hear and speak to each other instantaneously as they would when using a traditional telephone service.

If a VoIP call is to a mobile or landline, a gateway decodes the call and forwards it as an ordinary voice call to the telephone exchange (PSTN).

VoIP calls can also be made peer-to-peer where one computer connects with another, e.g. Skype, or through a server-based exchange, e.g. Vonage.