Voice over Internet Protocol (VoIP) is a methodology used for communication. It uses various technologies such as IP telephony, voice over broadband, and internet telephony among others to provide communication services over a packet switched network (IP data network).
Additionally, the network components consist of several other components such as gateways, switches, routers and others to carry voice and data content over the IP based network. The terminal equipment can be a regular telephone, VoIP phone, computer or mobile phone.
The first VoIP call was made between two PCs in 1995. However it was really a decade later that the establishment of major broadband infrastructure in developed countries paved the way for the introduction of mass-market VoIP services. Since then VoIP in the residential market has been characterised by widespread adoption of Skype. In the business market it seems no service provider is emerging to dominate the global market, as each region has its own key players.
There are several protocols used to implement VoIP services such as H.323, Session Initiation Protocol (SIP), Inter Asterisk eXchange (IAX), Real Time Protocol (RTP), and Media Gateway Control Protocol (MGCP), among others.
VoIP systems employ session control and signalling protocols to control the signalling, set-up, and tear-down of calls. They transport audio streams over IP networks using special media delivery protocols that encode voice, audio, video with audio codecs, and video codecs as Digital audio by streaming media.
Various codecs exist that optimize the media stream based on application requirements and network bandwidth; some implementations rely on narrowband and compressed speech, while others support high fidelity stereo codecs.
Some popular codecs include μ-law and a-law versions of G.711, G.722, which is a high-fidelity codec marketed as HD Voice by Polycom, a popular open source voice codec known as iLBC, a codec that only uses 8 kbit/s each way called G.729, and many others.
VoIP is available on many smartphones, personal computers, and on Internet access devices. Calls and SMS text messages may be sent over 3G or Wi-Fi.
The Irish Times created a useful infographic detailing the history of the VoIP protocol which you can read here.