Voice-over-Internet Protocol (VoIP)

AAA

DEFINITION of 'Voice-over-Internet Protocol (VoIP)'

A technology that allows users to communicate through an Internet connection rather than an analog connection. Voice-over-Internet Protocol converts the voice signal associated with traditional phone technology into a digital signal.

INVESTOPEDIA EXPLAINS'Voice-over-Internet Protocol (VoIP)'

The adoption of VoIP technology has affected the telecommunications industry by reducing the demand for traditional phone services. Its popularity relates to the wider adoption and availability of broadband Internet access. VoIP has been increasingly used by businesses seeking to reduce the cost of their telephone service.

Depending on the VoIP configuration, phone calls can be made using a traditional phone with a special adaptor or through a computer. Because VoIP technology uses network routers, rather than the network configuration of legacy phone systems, the reliability of VoIP service can be negatively affected by high volumes of Internet traffic.  

RELATED TERMS
  1. ISP (Internet Service Provider)

    A company that provides consumers, businesses, and other Internet ...
  2. Telecom ETF

    An exchange-traded fund that invests in companies with a significant ...
  3. Internet Bubble

    A rapid rise in equity markets caused by speculation into online-based ...
  4. Society for Worldwide Interbank ...

    A member-owned cooperative that provides safe and secure financial ...
  5. Telecommunications Consumer Protection ...

    A U.S. federal law created in response to increased consumer ...
  6. Quick Response (QR) Code

    A type of bar code which can be read by a digital device, and ...
Related Articles
  1. Personal Finance

    How To Pick The Best Telecom Stocks

    This ever-changing industry can leave investors scratching their heads. Find out which metrics matter.
  2. Entrepreneurship

    From The Printing Press To The Internet

    Find out how this invention contributed to the development and evolution of the U.S. economy.
  3. Entrepreneurship

    Will Your Job Get Eaten by Automation?

    With the rapid growth of technology, it has been widely contested whether automation will start to replace jobs.
  4. Investing Basics

    These Four Industries Must Change to Survive

    Tech innovations from new companies are threatening long-time industry stalwarts in transportation, hospitality and finance.
  5. Professionals

    Is a Google Robo-Advisor on the Horizon?

    It's possible that Google is looking to get into the robo-advisor business, either as a new venture or as a way to provide more benefits to employees.
  6. Stock Analysis

    Smartphone "Flagship Killers" Coming after Apple and Samsung

    Learn why flagship killers such as OnePlus and Xiaomi have the potential to become the first legitimate competition faced by Apple and Samsung.
  7. Professionals

    Are These the 10 Best Stocks in the World?

    Most of the top 10 stocks in the world have performed exceptionally well over the past several years. Here's a look at their future prospects.
  8. Stock Analysis

    Where Does Yahoo (YHOO) Go From Here?

    Yahoo operates in a competitive environment, but if it makes the right deals there's no reason why it can't thrive.
  9. Personal Finance

    Can Mobileye Revolutionize The Car Industry?

    Cars are evolving into vehicles connected to the ecosystem around us. With its ability to sense and detect objects around a car, Mobileye's technology is making that connected ecosystem possible.
  10. Professionals

    Tips on How Financial Advisors Can Go Paperless

    Going paperless may seem daunting for some advisors, but new software and hardware technologies are making it easier every day.
RELATED FAQS
  1. Has increased data usage affected the telecommunications sector in developed countries?

    The big news in the telecommunications sector for developed nations is bigger, cheaper data. Global data traffic is expected ... Read Full Answer >>
  2. What are the main factors that affect stocks in the telecommunications sector?

    It is tempting to think that share prices in different sectors are controlled by unique underlying principles, but this is ... Read Full Answer >>
  3. Has deregulation helped or hurt the profitability of companies in the telecommunications ...

    Deregulation is almost always a double-edged sword in terms of business profitability. The profits of legally protected monopolies ... Read Full Answer >>
  4. How does the landscape of the telecommunications sector in the U.S. compare to Canada?

    From a global perspective, there are more similarities than differences between the telecommunications sectors in the United ... Read Full Answer >>
  5. What are the financial benefits of hire purchases?

    The primary financial benefits for a company using a hire purchase plan include maximizing working capital, the ability to ... Read Full Answer >>
  6. Why should an investor include an allocation to the telecommunications sector in ...

    An investor should include an allocation to the telecommunications sector in his portfolio, because telecom offers an investor ... Read Full Answer >>

You May Also Like

Hot Definitions
  1. Nanny Tax

    A federal tax that must be paid by people who hire household help (a babysitter, maid, gardener, etc.) and pay them a total ...
  2. Dog And Pony Show

    A colloquial term that generally refers to a presentation or seminar to market new products or services to potential buyers.
  3. Topless Meeting

    A meeting in which participants are not allowed to use laptops. A topless meeting organizer can also ban the use of smartphones, ...
  4. Hedging Transaction

    A type of transaction that limits investment risk with the use of derivatives, such as options and futures contracts. Hedging ...
  5. Bogey

    A buzzword that refers to a benchmark used to evaluate a fund's performance. The benchmark is an index that reflects the ...
  6. Xetra

    An all-electronic trading system based in Frankfurt, Germany. Launched in 1997 and operated by the Deutsche Börse, the Xetra ...
Trading Center
×

You are using adblocking software

Want access to all of Investopedia? Add us to your “whitelist”
so you'll never miss a feature!