Costs to VOIP service providers

[guest]

Hi,

I am really curious about whether there are any variable costs to VOIP service providers. I understand that pc-to-pc doesn't cost a thing. But is there any cost to VOIP service providers when I make a call from my pc to a regular phone. And if there is a cost who does VOIP service provider make this payment to? Would that be at a cheaper rate pc to phone consumes less KB? Is there any source I can read on this?

Many thanks,

Emre Kicik

[Mike]

Hi Emre,
PC to PC VoIP applications are available that allow free voice transfer across the internet, Skype is a good example. The only charge for you is your internet connection fee. The voice being transferred is just considered data to the internet provider, just like downloading or uploading a file (although there have been some cases where ISPs sniff out VoIP packets and have blocked or tryed to block VoIP provider traffic).

For the Broadband Phone service providers such as Vonage, Sunrocket, Lingo etc. where the model is using your existing telephones with an ATA, allowing you to call anywhere in the world, it is a bit different. Take a look at the link below to learn more about the travel of a VoIP phone call.

Basically, a VoIP Service Provider doesn't own a whole VoIP network. It can be considered as a collection of networks, just like the PSTN is a collection of networks operated by thousands of service providers. These providers enter into interconnection agreements with each other. These agreements include billing agreements. With PSTN billing is normally generated through CDRs (Call Detail Records), which are based on minutes of usage. This is probably a similar method used for VoIP right now, rather than by bandwidth use. Although saying that, ultimately as VoIP becomes more and more implemented, this may change to bandwidth usage billing, which would make more sense for service providers. However, saying all this, the beauty of VoIP Providers currently is that some of them charge a fixed monthly fee, regardless of usage. As an aside, some articles suggest that it may take a VoIP provider a couple of years before it starts making money from a user.

http://www.whichvoip.com/voip/voip_w...t_advanced.htm

The above is by no means an in depth description, but just some basics of how and why charges are involved. Hope this helps some of your curiosity!

Best Regards,
Mike