Internet Gurus Guide to Internet Telephony

[Ring Ring!]

How do Internet phones work?

Regular phones work over regular phone lines. Your phone is connected to a long pair of copper wires that run to the local phone central office. When you call a friend, your call is routed from that central office through other switches until it finally ends up at the friend's phone office and it runs down the copper wires to his phone. This scheme has been unchanged in concept since the first phone exchange was installed in about 1880.

Internet phones, on the other hand, turn your voice into packets of Internet data and use your Internet connection to connect instead of a regular phone line. (Even if you have a DSL connection that physically uses your phone line, it's logically separate and doesn't use or interfere with your regular phone service.) Since no whizzo Internet innovation would be complete without a hard to pronounce new abbreviation, we call this Voice over IP or VoIP.

The older Internet phones talked only to each other, so you and your friends all needed to have Internet accounts and to be online at the same time. The newer ones are connected to the regular phone system, so your VoIP phone can have a real phone number that anyone can call.

Originally, VoIP ran through people's PCs, so you needed to get a microphone and speaker, plug them into your computer, load up software, and run it whenever you wanted to place or receive a call. Although this kind of setup is still available, now it's increasingly common either to have a separate adapter box that plugs into the net and has a jack for a regular phone, or to have a specially made IP phone that plugs directly into the net.

Do I want an Internet phone?

Maybe, maybe not. The best thing about VoIP is that it can be very cheap. Calls to other users on the same VoIP system are invariably free, and calls to real phones are free or cheap as well The less good thing is that the call quality is not always great, the PC based systems can be a pain to use, and VoIP phones aren't reliable enough to use as your only phone.

What kind of Internet connection and equipment you need

The first thing you need for VoIP is a broadband net connection such as DSL or cable. For good quality voice, your connection needs to handle at least 50K to 90K bits/second in each direction. Since the slowest, cheapest DSL connections are rated at 128K, this should be no problem, at least if you're getting the connection you're paying for. Two other factors that affect voice quality are delay and jitter. Delay is what it sounds like, the time it takes the packets to get to or from the rest of the net. If your connection has a lot of delay, you'll be able to hear it in your calls, sort of like a satellite connection, or in really bad cases, like talking to the moon. Jitter measures how consistent the delay is. More consistent is better, less consistent (more jitter) causes gaps in the conversation or Max Headroom-style stuttering. Unless you're the kind of person who keeps telephone network test equipment lying around the house, the only practical way to find out about your delay and jitter situation is to try a few VoIP calls and see how they sound. Most commercial VoIP services give you a free trial period of a week or two, and let you cancel and pay nothing if you don't like it,

A few of the PC based VoIP services work over a dialup connection, but voice over IP over modem over phone doesn't have enough capacity for intelligible voice unless you have a really loose definition of intelligible.

For the PC based systems, you need speakers and a microphone if your computer didn't come with them. If you use VoIP very much, you should get a headset or telephone style handset for improved sound quality. You can find adequate headsets for under $15.

Cisco ATA

For the phone to phone service, the provider will ship you an adapter box, such as an industry standard Cisco ATA-186, or often now custom hardware made by the provider. You can get the hardware directly from the provider (see below), or you can often get routers with a built-in adapter. These routers are invariably tied to specific providers who subsidize the cost of the router and make it up from your monthly service fees, much like cell phones. A few providers also support IP phones, fancy desk phones that include the adapter, but since they cost about $300 apiece they're not popular outside of fancy offices. The phone adapter uses an Ethernet connection, just like a PC. If you want to use your phone on the same broadband connection as your computer(s), which you probably do, you may need a router to connect all of your equipment to the broadband. If you don't have a router, most VoIP adapters are now designed to plug between your DSL or cable modem and your PC, to let you share the connection. If you already have a router to connect several PCs, you can either plug the adapter into the router or vice-versa. Fortunanately, the adapter invariably comes with pictures showing where the cables go. Unlike a PC, the adapter needs no setup other than plugging it into the router or modem, plugging in the power cord, and plugging a phone into it.

Phone numbers

The services that offer incoming calls give you a real phone number that anyone can call. The phone number need not have any relation to your physical location. If you're in Duluth and you want a Phoenix number, that's fine, they don't care. Each has a growing list of places where they offer numbers, although coverage outside of big cities varies a lot.

Most VoIP users have flat rate service so it makes little difference to your bill where your number is, but when people call you, they pay for a call to the nominal location of the number. If you have an aged mother in Florida, you might want to get a number that's a local call for her, or if you're a business that wants customers in New York, you can get a New York number to encourage them to think that you're local. You can even have several numbers in different places, for an extra $2 to $5 per month, so if you have friends or customers in New York, they can call a local New York number and it's you.

Most providers now support phone number portability, that is, if you already have a phone number, and it's in one of the places where your provider offers numbers, you can move your existing number from a regular phone line or, in some places, a mobile phone. We've also switched from one VoIP provider to another and taken the number with us, although people report varying levels of success doing so, due to both technical problems and peculiarities of phone regulation. All providers support various sorts of call forwarding so that if your phone is busy or not answered, it can forward to another number. Many support a handy simultaneous ring feature so calls ring on another phone at the same time. We set that up to ring our cell phone so we can pick up the calls if we're out of the office or in the, uh, reading room.

Calling around the world

All of the VoIP carriers offer flat rate calling within the US, and nearly all include flat rate calling to Canada. For calls to other places, different providers offer widely varying plans. Lingo includes all of western Europe in its standard calling area. Broadvoice's primary $20 plan includes calls to 21 countries, and the $25 plan adds 14 more. IConnectHere has a $25 plan with 1000 minutes to the US and Canada and 250 minutes to a list of 30 other countries. To figure out if any of these plans are for you, you'll need to have an idea of what countries you call and for how long. All VoIP offer very low per-minute international rates even to places that aren't included. If you make four hours of calls a month to Grandma in Olde England, you might think you'd obviously want an international plan, except that the rate to call the UK is typically 2 cents/min, so four hours would cost $4.80 and the international add-on is usually $5. The arithmetic is straightforward, but comparing everyone's plans can be tedious. We won't even try, since by the time we completed our chart, the prices would change.

If you have friends or colleages in other countries, many VoIP carriers offer local numbers in countries around the world, so that your VoIP phone is a local call for them, at a monthly cost of $5 to $10/mo. Most carriers offer numbers in Canada and the UK, and many offer numbers elsewhere in Europe, South America and east Asia. It might make more sense to get a London number so Grandma can call you.

Travelling and international users

If you travel, you can take your Internet phone adapter with you. When you're visting friends with a broadband connection, just plug your adapter into their router. Your phone number is assigned to the adapter, so wherever it is, your calls will follow. If you stay in hotels that offer broadband Internet service, you can use your Internet phone there, too, and avoid paying the ridiculous rates that hotels charge for phone calls. (We once called Switzerland from a fancy San Francisco hotel using VoIP for six cents a minute rather than the two bucks the hotel would have charged us. Nyahh, nyahh.)

The PC based systems all assign you an account and password that you can use on any PC with suitable microphone, speaker, and Internet connection. If you're visiting a friend who doesn't mind your messing with his or her computer, you can download and install the software for whatever service you're using, enter your account info, and make calls. If you plan to do much of this, you're probably better off bringing along a laptop of your own.

Although most Internet phone providers are located in the U.S., you can use their service anywhere you can get a reliable broadband connection. For the services like Lingo and Packet8 that give you a phone number, it's by far the cheapest and easiest way for someone overseas to maintain a US phone number. Since countries vary widely in their attitude toward VoIP, most VoIP providers will only set up accounts with US billing addresses and ship the the adapter to the billing address, so you either need a US address or a friend with a US address to get set up. Monthly billing is all on-line by credit card, after the equipment arrives. Many carriers offer service in Canada and at least one (Vonage) offers it in the United Kingdom.

The price

For the PC based systems, you generally buy phone time in units of $25 or more, then use it up like a prepaid phone card as you make PC-to-Phone calls. Net2Phone charges 2 cents/minute for calls within the US, more to other countries. PC-to-PC calls are free.

For the systems that use a real phone, the prices vary a lot. They all offer free calling to other people using the same provider, but beyond that, prices and coverage change frequently. Rates are typically $15 for 500 minutes/mo, $20 to $30 for unlimited calls in the US and Canada. Some carriers still offer local or in-state plans with unlimited calling to your area code and some adjacent ones, or within your state, and per-minute charges elsewhere. These can be a good deal if you currently make a lot of short-distance toll calls, since the VoIP providers' idea of the local area is generally a lot bigger than your local phone company's. All providers include a long list of standard features such as caller ID, call waiting, call forwarding, and voice mail. Some charge extra for some of the more exotic features, just like your regular phone company does. All have an initial setup charge, usually lower or waived if you use a coupon. We have some coupon links below.

If you don't use at least $15/mo in long distance, none of these services will save you money unless you replace an existing second line or are paying a lot for services like caller-ID and voicemail that the VoIP services bundle in at no extra charge.


Despite occasional claims to the contrary, none of these services is anywhere near as reliable as a normal phone. They say, and we agree, don't use them as your only telephone.

One reason for that is that they all plug into the power line, so if the power goes out, they go out, too. You can get a UPS to provide power during short blackouts, but even if you do, most cable systems don't work when the power's out, and few ISPs have enough backup to last more than an hour or two without power. And, of course, when your Internet service is on the fritz, your VoIP phone won't work either.

Also, most of them provide only second-rate 911 service. If you tell them where the phone is physically located (and you remember to update your location when you move) they'll complete 911 calls, but it's as likely to ring the phone at the local police station rather than the real 911 center. Packet8 is an exception; for an extra $1.50/mo they can provide real 911 (known as enhanced or E-911) service.

Signing up

Here are some signup links for services with which we're familiar. The only one of these that we use is Lingo, so we list it first. We used to use Vonage, but the voice quality deteriorated and calls to their help line reached only busy signals, so now we list them last.
Lingo Lingo: A straightforward VoIP service from Primus, a large Canadadian long distance company. Unlimited calling for $20, 500 minutes per month for $15, and for $8 a basic plan where you pay for all outgoing calls. All the plans include the US, Canada and western Europe in the local calling area. First month free if you sign up via the link to the left.
AT&T AT&T CallVantage: Yes, it's that AT&T, the ones who used to be The Phone Company. It costs more than other VoIP services, $20 for a local plan or $30 for unlimited US/Canada, but it's supposed to be better engineered and has better voice quality than other VoIP providers.
VoicePulse VoicePulse: Prices and features are typical, but with no termination fee. They offer some fancy phone features, so you can do selective call forwarding depending on the calling number, route calls from people you don't like to a permanent busy signal, and other tricks. They also offer conference calls and currently offer cheap prepaid minutes to some countries in Europe. If you sign up, enter code number 6335256847353826 to waive $10 equipment shipping charge.
BroadVoice BroadVoice: Offers a large list of countries to which you can get flat rate service. Also lower rates if you have your own VoIP phone or adapter including a rock-bottom $6/mo with 100 minutes outgoing and unlimited incoming calls.
Packet8 Packet8: Phone-to-phone service using proprietary equipment. For a while it looked like they would run out of money and shut down, but they seem to have pulled through. Their service is supposed to be OK and if you want to see the person you're talking to, they offer videophones at about twice the cost of regular phone service. Use coupon code SAVE or SAM to get $20 off signup.
IConnectHere IConnectHere: PC-to-phone and phone-to-phone service. For phone-to-phone you have to buy a Cisco ATA for $139, or they'll lend you an adapter that plugs into a USB port on your computer, but only works when your computer's running. Bundled rates can be quite cheap if you make a lot of calls, $10 for 1000 minutes to North America, or $8 for 200 minutes to Europe or 100 minutes to Latin America. They'll give you a trial account with 10 minutes of PC-to-phone time for free.
Net2phone Net2phone: PC-to-PC and PC-to-phone service. PC-to-PC is free, PC-to-phone is 2 cents/minute in the US. Many other places including Yahoo resell this; Yahoo will sell you $10 chunks of time rather than the $25 minimum if you buy directly from Net2phone. Yahoo is in the process of switching from their old 10 cents/minute system to Net2phone, so be sure you get the new one if you sign up with them.
Vonage Vonage: Phone-to-phone using a Cisco phone adapter, the largest Internet phone-to-phone service, $16/mo for 500 North America minutes plus unlimited local calls, or $26/mo for unlimited. Money back guarantee for the first 14 days, after that there's a disconnect fee of $40 when you terminate service. If you click on this link to sign up, they should offer the second month of service free. We've found their customer service to be non-existent and we've heard reports of service outages so we can't recommend them any more.

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