The History of VoIP

By Mike Anderson

Although broadband phone service continues to phase out traditional PBX and analog systems, many people still unaware of the overall technology and the benefits it offers.  This article will reveal the secret used by today’s broadband phone service providers and discuss the history of VoIP.

The Impact of Broadband Phone Service

VoIP providers have revolutionized voice communications in both the business and residential sectors.  Small, medium and large businesses are able to reap benefits in terms of cost savings and unified communications.  More residential customers are switching due to the growing availability of broadband internet and the ideal of cutting back on their phone bills.  So, does broadband phone service have the power to become the new face of the telephony communications industry?  Observers say the answer is a definite yes, even though traditional phone systems are still practical and widely used.  The truth is that broadband phone service and VoIP itself is a relatively new technology, one that will continue to evolve, improve and become more common in homes, corporate offices and everyday business operations. 

The First VoIP Provider

When researching broadband phone service, you will learn that the technology was introduced in 1995 by a VoIP provider called Vocaltec.  Vocaltec launched what is said to be the first internet phone software, an application designed to function on a home-based computer similar to how PC phones are used today.  Known as Internet Phone, the software required sound cards, microphones and speakers.  Instead of using SIP protocol which is more prevalent today, Internet Phone used H.323 protocol.  Many view Vocaltec as the Skype of the mid 1990s because the company experienced considerable success as a VoIP provider.  

Although many people took a liking to the concept, there were major drawbacks in terms of quality and overall efficiency.  At the time, the use of dial-up modems and lack of broadband availability resulted in poor voice quality when compared to the typical analog phone call.  Despite the issue of quality, Vocaltec’s achievement is still viewed as a significant milestone as it essentially represented the world’s first IP phone and laid the blueprint for the broadband phone service we enjoy today.

Slowly but surely, VoIP providers continued to develop the concept and by 1998, the technology represented an estimated 1% of all voice traffic in the U.S.  Thereafter, manufacturers began to hop on the bandwagon by creating devices that enabled computer-to-phone and phone-to-phone communications.  Networking vendors such as Lucent and Cisco developed hardware with the ability to switch and route VoIP traffic.  As a result, VoIP traffic made up more than 3% of all U.S traffic by the year 2000. 

Broadband phone service was in full effect by 2005 as more VoIP providers emerged onto the scene.  By this time, the issue of voice quality had been addressed with the increasing availability of high-speed internet access.  With genuine broadband phone service, VoIP providers were able to deliver reliable, crystal clear internet powered telephone calls.   In 2007, revenue from broadband phone service equipment sales reached around $3 billion and forecasted to be more than $8.5 billion by the end of this year.  These projections are due in large part to incredibly affordable broadband phone unlimited plans and all the advanced features being offered by VoIP providers.

The Future of VoIP

Considering how far the technology has come, it will be interesting to see where VoIP providers take broadband phone service over the next couple of years.  The possibilities seem endless with the prevalence of wireless networks and the growing demand of video over IP.  One thing we can assume is that VoIP can only improve form here.