More History on VOIP

In Business Buy Guide, VOIP System Quotes on September 22, 2010 by businessbuyguide Tagged:

Voice over IP, or VoIP, was first created in 1973 as a “Network Voice Protocol,” for ARPANET, essentially the earliest form of the Internet, in use by government and educational institutions at the time.  NVP was an experimental protocol. The technology didn’t expand much in the commercial sense until 1995 when the first IP telephone software, called Vocaltec, hit the market.  The software, when run on a computer with a soundcard and an Internet connection, could use the computer speakers (or headset) and a microphone to:

* Accept voice input
* Transmit the audio, over the internet, to another computer
* Play the audio on the other computer

In effect, enthusiasts eventually termed the back-and-forth transmission of voice audio over the Internet as “Internet Phone.”

Major drawbacks of this early technology were that, in the 1990s, broadband speeds were unheard of.  Everyone was connected to the Internet through a dial-up modem.  This meant that typically, when two people wanted to talk, they would both run the software, which would dial “into” the other person’s computer, establish a connection, and then initiate the voice conversation, all through dial-up Internet connectivity.  The system suffered from technical issues related to sound card compatibility and very poor sound quality.  Never the less, a groundbreaking achievement was made with the first Internet Phone, and all future VoIP technologies were based on the same concept. [1]

Significant VoIP History

* 1996 – Vocaltec successfully marketed its VoIP-Internet Phone product.
* 1998 – Within two years, PC to Phone switching technology advanced so that many new companies, such as Level 3, began offering a “soft switch,” which acted as a gateway between telephone networks (and IP networks), replacing traditional hardware switch technologies.  At this point, about 1% of all voice traffic was VoIP.
* 2000 – Large networking hardware companies like Cisco and Lucent provided the ability to route and switch VoIP traffic.  By the new millennium, 3% of U.S. voice traffic was over VoIP.
* 2001 – The expansion of broadband Ethernet greatly enhanced VoIP capability and quality.  Phone companies even started using switching hardware to route calls over the Internet.
* 2005 – By this year, issues related to poor sound quality were finally resolved as VoIP Internet traffic is provided priority over data traffic to ensure signal quality and fewer dropped calls.  By this year, Video over IP (otherwise known as video “streaming”) becomes popular, as well, and uses much of the same VoIP technologies.
* 2008 – The latest VoIP technologies are still in their relative infancy, but the technology and software continues to advance as the Internet continues to grow.  According to, revenues from VoIP equipment sales alone were about $3 billion, and sales of $8.5 billion were forecast for 2008.  Almost every major Internet Service Provider in the world is offering a VoIP phone-to-phone package to their customers, as a replacement for the more expensive, traditional phone service.


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