VoIP stands for Voice over Internet Protocol.
VoIP uses your broadband internet connection to make and take calls.
VoIP service plans come in different tiers or steps. You can get plans that charge you cents per minute for every call, plans with set minutes, or you can purchase an unlimited plan.
For example, the US company ITP has 3 plans: Basic, Premium, and Global. Basic gives you 500 minutes for $9.99 per month. Premium allows unlimited calling for $19.99. Global has the same minutes as Premium along with a select number of countries.
Almost all USA VoIP service providers offer an unlimited plan that costs a flat monthly rate for use. These plans vary in price and features offered, but they usually offer unlimited minutes and free local and long distance calling.
Unlimited plans are good for standard users who don’t need to keep careful track of every minute spent on the phone, as well as the ones who need more minutes than the casual user.
With VoIP service, you don’t need to worry about long distance calls within the USA (or Canada for the most part). Local and long distance calls both use the internet, and are much cheaper than landline calls.
While it’s free to call long distance for you, it might not be free for your friends. If you have a new area code for your VoIP number, your friends will have to pay for long distance. With a virtual number, calls can still be local for everyone else in your area.
International VoIP works the same way as local VoIP - the call just ends in a different country. Voice is converted and compressed into data, then transmitted over the internet to its destination. The digital information is either decompressed by another VoIP network, or it unloads at the destination’s nearest public switch telephone network.
Because it uses the same process for all its calls, international VoIP calls are much more affordable than hardline international calls. Calls from the USA to developed countries tend to cost between a half cent (.5¢) to 2 cents per minute; less developed countries cost more.
Some VoIP service providers offer mobile VoIP, which allows you to use your phone anywhere (even outside the USA) as long as you have a high speed internet connection. Mobile VoIP is excellent for international travellers.
Other VoIP service providers, such as Skype, specialize in free in-network calls. A Skype user in the USA can call another user in, say, Australia for free. The service provider in this instance doesn’t have to switch networks. This feature is offered by most USA VoIP providers, since making a phone call on their system doesn't cost them nearly as much as a call to the public telephone network.