<img height="1" width="1" style="display:none" src="https://www.facebook.com/tr?id=3151120948505270&amp;ev=PageView&amp;noscript=1">

What is a VoIP Phone System: A 2024 Guide

Communication is evolving rapidly, transforming the way we connect with one another and conduct business. Since the emergence of VoIP in 1995, more and more businesses have turned to the system - primarily to save costs. 

But what exactly is a VoIP system? How does VoIP work? And who can benefit from VoIP? That’s what we’ll be exploring in this helpful guide. Read on for everything you need to know about VoIP.


What is VoIP?

First of all, what does VoIP stand for? VoIP stands for Voice over Internet Protocol. It is a technology that enables voice communication and multimedia sessions over the internet. 

Unlike traditional telephone networks, which rely on circuit-switched networks to transmit voice data, VoIP uses packet-switched networks to transmit voice data in the form of digital packets.


What Are VoIP Phones?

VoIP phones are the devices you use to make phone calls through the internet instead of traditional phone lines. These phones can be physical devices like regular phones, or they can be software-based applications installed on computers or mobile devices.

To make the most of Voice over Internet Protocol, you’ll need a router for the internet and a handset. Your phone system or handset will connect to the internet and transmit your speech. 

These phones offer flexibility, cost savings, and advanced features compared to traditional landline phones.



How VoIP Works

Voice over Internet Protocol operates by converting analogue voice signals into digital data packets that can be transmitted over the internet. These data packets are then reassembled at the receiving end, where they are converted back into analogue signals, enabling clear voice communication.

Voice over Internet Protocol technology uses various protocols and codecs to ensure efficient transmission and high call quality.

For modern call centres, the benefits of VoIP are profound. Improved call quality, scalability to handle growing call volumes, and seamless integration with digital tools are inherent advantages. VoIP empowers call centres to adapt swiftly to changing needs, providing a foundation for agile, efficient, and future-ready communication solutions.


VoIP Phone Systems vs Landline

One of the key differences between Voice over Internet Protocol and traditional landline systems is the infrastructure used for communication. 

Landline systems use dedicated telephone lines to transmit analogue signals. Voice over Internet Protocol, on the other hand, relies on internet connections to transmit digital data. This key difference impacts the cost, flexibility and functionality. 

Traditional landlines, while reliable, can be cost-prohibitive and lack the scalability needed in today's dynamic business environment. On the contrary, VoIP uses the internet to transmit voice and data digitally, offering considerable cost savings, scalability, and many advanced features.

For modern call centres, Voice over Internet Protocol is extremely beneficial. Improved call quality, scalability to handle growing call volumes, and seamless integration with digital tools are advantages. This software empowers call centres to adapt swiftly to changing needs, providing a foundation for agile, efficient, and future-ready communication solutions.


Who is VOIP For?

Voice over Internet Protocol is suitable for a wide range of users, including:

  • Businesses of all sizes
  • Remote workers
  • International travellers
  • Those seeking cost-effective communication solutions

Its flexibility, cost savings, and advanced features make it a great option if you’re looking to enhance the communication capabilities of your organisation.




How to Choose the Right Phone System for Your Business

When selecting a phone system for your business, several crucial considerations can significantly impact your communication infrastructure. Here's a concise list of key factors to weigh:


Evaluate the overall expenses, including installation, equipment, and ongoing service fees. Compare the cost-effectiveness of Voice over Internet Protocol against traditional landline systems.


Sound Quality

Prioritise crystal-clear audio for effective communication. Assess the sound quality offered by both VoIP and traditional landline options.


Features and Capabilities

Identify the specific features essential for your business operations, such as voicemail transcription, video conferencing, and scalability. Compare the feature sets of VoIP and landline systems to ensure they align with your requirements.


Internet Reliability

For VoIP systems, assess the reliability of your internet connection, as it directly impacts call quality. Consider redundancy measures to mitigate potential internet-related disruptions.



Anticipate the future growth of your business and evaluate how well each system accommodates scalability. Determine the ease of expanding your communication infrastructure as your business expands.


Integration with Other Tools

Evaluate the compatibility of each phone system with existing software and tools used in your business. Explore how seamlessly the phone system integrates with customer relationship management (CRM) software or other essential platforms.


Reliability and Support

Consider the reliability and reputation of the service providers for both Voice over Internet Protocol and landline systems. Explore customer support options and responsiveness to ensure timely assistance when needed.

By systematically assessing these considerations, your business can make an informed decision tailored to its unique communication needs and future growth aspirations.


Pros and Cons of VoIP

Now we understand the ins and outs of Voice over Internet Protocol, let’s explore its benefits and drawbacks. 



You Can Save Costs - VoIP typically offers lower costs for both domestic and long-distance/ international calls compared to traditional phone systems.

Flexibility -  VoIP allows you to make outbound and receive incoming calls from any device connected to the internet, making it a flexible and mobile choice. 

Scalability - VoIP systems are easily scalable, making it easy to add or remove users as needed without requiring tedious infrastructure changes.

Advanced Features - VoIP systems often include advanced features such as voicemail-to-email transcription, call forwarding, and virtual telephone numbers.



You Rely on Internet Connection - VoIP quality pretty much relies on a stable internet connection. This could cause issues if you have a poor internet connection. 

Power Outages Can Cause Disruptions - Unlike traditional landlines, Voice over Internet Protocol systems may become inaccessible during power outages. This is why we recommend having a backup power source in place.

Could Be Vulnerable to Hacking - VoIP calls may be vulnerable to security threats such as hacking, eavesdropping, and malware attacks - so be sure to have proper security measures in place.


Considerations when Choosing a VoIP Phone System

Current Setup - When selecting a VoIP system, compatibility with your existing infrastructure is paramount. Assess the ease of integration to avoid disruptions in your operations. A seamless transition ensures that the new system complements, rather than complicates, your current setup.

Volume of Calls - Anticipate the future growth of your business and evaluate the scalability of the system. Ensure it can effectively handle fluctuations in call volume, preventing bottlenecks during peak periods and accommodating your business's evolving communication needs.

Budget - Before making a decision, conduct a comprehensive cost analysis. Consider installation expenses, equipment costs, and ongoing service fees. Aligning the VoIP system with your budgetary constraints ensures a financially sustainable and efficient communication solution.

Features - Identify and prioritise the features that are crucial for your business operations. Whether it's voicemail transcription, video conferencing, or advanced call routing, ensure that the selected VoIP system enhances your operational efficiency. Tailoring the features to your specific requirements guarantees a system that meets your unique needs and challenges.


VoIP Phone System FAQs

Can I Use My Computer While I Talk on the Phone? 

Absolutely! It allows simultaneous use of your computer for other tasks while engaged in a call. This flexibility enhances multitasking capabilities, contributing to increased productivity in your work environment.


How Do I Know If I'm Being Called on a VoIP Phone System? 

When receiving a call on a VoIP system, your phone or device will display caller information, similar to traditional systems. Additionally, many Voice over Internet Protocol systems offer customisable notifications and caller ID features, providing a seamless and familiar call experience.


What Kind of Calls Can I Make on a VoIP? 

VoIP supports a broad range of calls, including local, long-distance, and international calls. Whether connecting with clients across town or collaborating with global partners, Voice over Internet Protocol offers cost-effective and versatile communication options, making it suitable for various business needs.


Making the Change to a VoIP Service?

Embark on the future of business communication by transitioning to a VoIP phone system. Experience enhanced flexibility, cost savings, and advanced features. For seamless integration and expert support, trust MaxContact. 

Contact us today to elevate your communication infrastructure and embrace the transformative power of Voice over Internet Protocol.




Daniel Harding
Post by Daniel Harding
Daniel is the Director of MaxContact Australia. Since launching the business in Australia with its first clients in 2019, it has rapidly grown to become the solution of choice for businesses across Australia and New Zealand. Daniel has a comittment to ensuring that MaxContact Australia continues to grow whilst delivering value for all customers.