What Is a VoIP Number & How Does VoIP Work

VoIP stands for Voice Over Internet Protocol (VoIP), and it’s a term used to refer to the technology that allows us to make phone calls using the internet.

VoIP phone numbers — virtual phone numbers, if you will — gives you the freedom to make phone calls wherever there’s an internet connection. It means you can move away from the limitations of a traditional phone system and work more flexibly, which is crucial for today’s fast-moving businesses.

A VoIP number is unique because it uses the internet and internal enterprise local area networks (LANs) to make calls. This differs dramatically from traditional landlines, which use copper phone lines to communicate. A VoIP number also differs because it’s assigned to a single user as opposed to a terrestrial phone line, which is restricted to a particular location.

Your unique VoIP phone number is simply a series of digits like any other traditional phone number, but it identifies a user on the internet protocol (IP) network, rather than the public switched telephone network (PSTN).

Before we get into the details of how to use your VoIP phone number and what the specific benefits are, it’s important to understand exactly how VoIP phones work.

A VoIP phone system works by converting analog voice signals into digital data. Once your voice has been encoded into digital data, it has to be re-coded back into voice signals so that the other person on the line can clearly hear and understand what you are saying. This process requires codecs, which stands for encoder-decoder. Codec is a computer program that uses compression to convert between analog and digital sound or to shrink a large movie file.

In basic terms, this means that your voice is digitized into code so it can travel through the internet, then converted back to your voice so that the receiver of the VoIP call can hear you nicely and clearly.

A VoIP phone system comes complete with all the benefits you’d find with a traditional landline package, such as interactive voice response, ring groups, automatic call distributor, toll free number, instant messaging, and voicemail. However, a VoIP phone system won’t cost your business nearly as much as a traditional landline.

VoIP phone systems are becoming more popular among small businesses. Research shows that about 61% of businesses plan to drop their traditional phone systems in favor of VoIP phone systems when their current contract runs out. When you look at the advantages, which we’ve listed below, it’s easy to see why so many small-business owners are switching to VoIP.

For many small-business owners, it makes economic sense to use a VoIP provider as there will be a 90% reduction in startup costs. VoIP — a plug-and-play service — enables businesses to have a fully functional phone system without having to spend money on additional equipment and installation.

Once you decide to switch to a VoIP phone system, you’ll need to decide whether a non-fixed or fixed VoIP phone number is best for your business.

A non-fixed VoIP phone number doesn’t need a fixed address. This is why people sometimes refer to them as a “virtual phone number,” which can be linked to any location across the world.

This ease of use is perfect if you have a remote team or offices in various locations across the globe. (These guides walk you through how to set up VoIP at home or in an office.)

On the other hand, a fixed VoIP phone number is one that does have a fixed address assigned to the number. The reason businesses use a fixed VoIP number is that it’s less likely to be hacked. Data transmission is more secure as a fixed VoIP system uses its own cables and makes it more difficult for hackers to mask their identities.

If you want more information before choosing your VoIP solution, take a look at our Non-fixed vs. Fixed VoIP article.

The first thing you need to do is choose a reliable VoIP service provider. Take a look at our list of the best VoIP service providers for small businesses if you need some help selecting one.

Make sure when selecting your VoIP plan that you pay close attention to the features that your service provider offers. These can vary from one provider to another.

Next, it’s crucial that you check your internet strength. You need a strong enough to handle your VoIP phone system. You can use a free VoIP speed test tool to help you assess this.

Now it’s time to choose which devices you want linked to your VoIP phone number — this could be your desk phone, cell phone, tablet, laptop, desktop computer, or all of the above.

If you’re trying to reduce operational costs or need more flexibility from your phone system, then getting a VoIP phone number is probably the best solution for you. The simple setup means you can get up and running immediately with no need for new equipment. All you need is a strong internet connection and your business can enjoy the benefits of using VoIP.

Disclaimer

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