The Truth About VoIP - Page 2

Part 1 – by Jim McNally

Continued from page 1

As far as the “one line = one call = one number” paradigm, that changes too. Let's look at a typical office scenario with 5 phone lines and a main number. Today, when someone calls the main office number, the CO connects that call to the phone line with that number, and it rings in the office. Then let's say another call is made to that same main number. The CO receives the call, realizes that the first line is busy, and instead switches to the next line in a sequence known as a Hunt Group. This would ring the second phone line at the office, which actually has a different phone number assigned to it (you could also call that number directly if you know what it is, but most people never know what their other lines' numbers are.) So now we've got two conversations going on.

Next, a third person in the office picks up the phone and makes a call. The office phone system (or that person if it's an older system) selects the third line, and makes the call. This repeats until all 5 lines are busy. Then, no one else in the office can make a call until one of the ongoing calls finishes; likewise no one else can call in until a line is freed up.

In a VoIP system, things work differently. When the first call is made to the main number, a series of setup packets are sent to the equipment at the customer end (which may be a port adapter box, a VoIP Phone System or a group of VoIP phones) which includes things like the phone number being called and the caller ID of who is calling. The customer equipment gets this information, and based on how it has been set up starts to ring the phone(s) on the office. When someone answers it, the “connection” is made and they're now talking.

So in comes the second call. Is it different from the first? Only in the caller ID from the calling party; the “here's the number being called” data (known as the Direct Inward Dial or DID number) is still the same main number – the VoIP equipment at the customer handles this locally (rather than the way it used to be handled at the CO) and rings the other phone(s). Now, our third person makes a call from the office. This is handled differently, as we just need to send our caller ID info and the number we're calling in the setup packets. Once the call goes through, we've got three people talking. How many “lines” are “in use”? One ( or none, depending on your view). Since making a call doesn't “tie up” that number, this can go on forever. In fact, many more than 5 simultaneous conversations can take place with just the one “line”.

Since this is so different, the VoIP industry had to change the way they did things as far as billing is concerned. So they borrowed a page from the Long Distance companies. What happens is the charge a single monthly fee for the “trunk” with the DID number attached to it, usually under $3 per month each. All calls are then billed by the minute – inbound and outbound both. Inbound calls (the industry calls this Origination - the call Originates from the outside world) are billed at a fixed per minute rate of less than 1 cent per minute. The call can either come from another VoIP customer, or from a Phone Company line through a company which has equipment to do this set up strategically across the country.

Now to the other side – what the industry calls Termination. This is when you place a VoIP call to somewhere – the VoIP carrier Terminates your call out in the outside world. This is all billed by the minute as well, including “local” calls. This may seem unfair, but remember there's not any “local” phone company involved anymore: your call to the pizza place down the block may go through your internet connection to your provider, who sends it through their network to Chicago or Atlanta, where it goes to Level3 who sends it to their equipment in your town where it goes into the local phone company and rings the pizza place. There's no way to tell how or through what connections this will happen, so there's no way to define “local” anymore. So billing by the minute makes sense.

In The Truth About VoIP - Part 2 we'll look at Long Distance and how VoIP changes this part of the Phone industry too, plus how you can use VoIP to save yourself money on your phone bill.

Continued from page 1

The Truth About VoIP - Three part article series
The Truth About VoIP - Part 1
The Truth About VoIP - Part 2
The Truth About VoIP - Part 3