How VoIP Works
Let’s understand VoIP by first studying how our existing phone system (the landline phone) works. These phones work with a system called “circuit switching." Circuit switching is very old concept that is still being used in modern phone systems. When we had to call someone, we would pick up the receiver and dial the number. Someone would then pick up the receiver and the call would be connected using many interconnected switches on the way to reaching the caller. This call will create a circuit. The inefficiency of this circuit is that as long as the call is connected, the telephone line remains engaged, hence, occupying one complete route for the call. This results in leaving a reduced number of, or possibly no, free lines at peak time period. If I were to phone someone at that time, the call could not be made.
VoIP, on the other hand allows us to make calls using an efficient method called "packet switching." This method does not occupy a complete communication line between the callers. Instead it opens a brief connection which is just long enough to send a chunk of data (called a packet) to another person. There are millions of random pathways available over the Internet through which data is transferred – providing almost unlimited lines for creating voice connections.
With packet switching, many calls can occupy the amount of space that, within a circuit-switched network, only one call does. While talking to someone over the internet, our voice exits the PC, and then goes through a VoIP gateway where the packets are converted back into the analog format before reaching the other person. There are three available means for transferring your voice using VoIP: ATA, PC- to -PC and IP Phone.