The idea of using your company network as a backbone for making telephone calls has been around for several years, but recent developments in the technology have increased the amount of companies who have started using it. You might know internet telephony by several other names - VOIP, Voice Over IP (IP stands for Internet Protocol), IP telephony, broadband telephony and VoBB (Voice Over BroadBand). Skype is the first widely adopted application which uses the internet backbone as the basis for transmitting voice and video call data.

The advantages of internet telephony are numerous, not least the cost savings associated with running telephone calls over the same network as the company network and internet. By combining the two applications – use of the web and making telephone calls – only one network is required instead of two separate telephony and IT networks. In a wider context, telephone and internet service providers (ISP's) can use their existing network, and network security, infrastructure to deliver services to customers. This is why it is so common to find cable/telephone/internet access all bundled together from companies in the business and domestic customer markets.

The cost of making calls also drops significantly as the internet (which is free) is simply being used to transmit your call in the form of data which is reassembled at the other end of the connection. All a user has to do is pay for internet access and they will bypass having to tell a telephone company for service. When you consider that the internet backbone is equally capable of delivering data to Australia as it is to the next cubicle, the cost savings become even more apparent.

Users frequently experienced poor call quality with internet telephony. Better technology has dramatically improved call quality so that it is just as good as a land line call. Another disadvantage was the fact that you couldn't make a telephone call if the internet connection was down - internet telephony relies on the internet backbone to transmit the call. This has led to criticisms of VOIP for its lack of redundancy but installations frequently run hand in hand with a fixed line system and still deliver significant cost savings.

Modern internet telephony systems use highly efficient bandwith and as this limited factor is removed more and more businesses are migrating their business phones over to IP based service. It's not just the cost savings - it is the functionality as well. Internet telephony includes not only voice calling, but also video and web conferencing, email interaction, and device utility for making and taking calls, faxes, and emails. This merging of communications technology and application (a device and internet telephony) is called "unified communications".

VOIP communications with the skype wi-fi phone technology.