Do you remember the days when long-distance calls cost an arm and a leg, making it a luxury to communicate with loved ones residing afar?

It was nearly impossible for businesses to have cost-effective global communication. But that was all before Voice Over IP (VoIP) revolutionized the way we connect with each other.

 

VoIP solutions may not have been the sole catalyst for a technological revolution of the business or office, but it played a critical part in shaping how businesses and offices today operate. Take a look around your own work environment and chances are that your business or office uses VoIP solutions. It has become commonplace around the world and heavily relied upon for communication through voice.

The evolution of VoIP (Voice over Internet Protocol) technology has seen it transform from experimental beginnings to a mainstream communication method, particularly in business settings.

Early development focused on transmitting voice data over the internet, with the first commercial VoIP call happening in 1995. Subsequent advancements have included the integration of VoIP with mobile networks (VoLTE, Vo5G), enhanced security features, and the rise of cloud-based VoIP solutions, making it a key component of modern communication infrastructure. These advancements have extended VoIP’s role beyond its traditional use in Internet-based applications, making it truly revolutionary.

 

A more detailed look at the evolution:

 

While VoIP as a commercial technology emerged in the mid-1990s, its roots lie in earlier work on packet voice systems and speech compression techniques from the early 1900s.

 

The history of VoIP stretches back to 1925 when AT&T and the Western Electric Company formed Bell Laboratories. Over time, Japanese scientists developed Linear Predictive Coding (LPC) which helped convert speech into transmittable digital voice signals. The development of ARPANET led to the first successful transmission of voice packets in the early 1970s. Since then, VoIP has transformed business communication by providing an inexpensive and flexible means of communicating using the internet.

 

let’s travel back in time to explore the journey of VoIP, from its humble beginnings to how it transformed into the powerful communication tool that connects us across continents, without burning holes in our pockets. Get ready for a fascinating trip that will make you appreciate every cost-free call you make today!

 

Where it began

Early Packet Switching Research (1920s-1970s):

Bell Laboratories, formed in 1925, began exploring packet switching and speech compression techniques. The development of Linear Predictive Coding (LPC) by Japanese scientists further advanced the process of converting speech into digital signals for transmission.

First Voice Packets on ARPANET (Early 1970s):

Danny Cohen is credited with the first demonstration of packet voice over the early Advanced Research Projects Agency Network (ARPANET).

Successful Real-Time Conversation (1974):

The first successful real-time conversation over ARPANET using packet-switched technology was achieved.

User Datagram Protocol (UDP) (1977):

UDP was added to carry real-time traffic, which is a crucial component for VoIP.

 

VoIP Emerges Commercially (Mid-1990s):

VoIP technology became commercially available, initially as a way to connect Private Branch Exchanges (PBXs) using internet protocols.

 

Early Stages as commercial technology

1991: Initial research into transmitting voice over the internet began.

1995: VocalTec enabled the first VoIP call, marking a significant milestone.

1996: Commercial VoIP software was launched, allowing users to make calls over the internet.

Mobile Integration and Expansion (2000s-Present):

2000s: By the turn of the millennium, VoIP accounted for 3% of all voice traffic in the US. This was a big step up from VoIP, with wider adoption becoming more and more common across the world as businesses saw the market gap for robust ‘VoIP-enabled’ hardware and software. Manufacturers started to release their VoIP devices, helping to bring VoIP accessibility into the wider market and VoIP began to integrate with mobile networks.

Voice over LTE (VoLTE): Enables voice communication over 4G and 5G networks, making VoIP a core part of mobile infrastructure.

Voice over NR (Vo5G): Extends VoIP capabilities to the latest 5G networks.

Cloud-based VoIP: The rise of cloud-based solutions has made VoIP more accessible and scalable for businesses.

Enhanced Security: Modern VoIP systems incorporate features like end-to-end encryption, multi-factor authentication, and fraud detection to protect users.

Flexibility and Cost-Effectiveness: VoIP’s flexibility and lower costs compared to traditional phone systems have driven its adoption.

 

2004: Full VoIP calling services were released, allowing companies to connect using VoIP. As broadband became more stable over time, so did VoIP. This made VoIP a legitimate alternative for businesses around the world.

‍2010: By now VoIP was becoming widely adopted across the world by businesses. The advent of hosted VoIP telephone systems also helped drive the change to a full VoIP network. Hardware and software was making it easier than ever to switch to VoIP.

‍2018: Openreach announced that they are switching off the UK’s ISDN network. This means that all new orders needed to be VoIP/SIP enabled. The push for a full VoIP network has never been fiercer, with service providers looking to convert their customers over to VoIP connections.

‍2019:

VoIP makes up around 60% of all new connections.

2016-2024: Remote Work, VoIP, and Unified Communications

VoIP technology in the United States alone had already become a $20 billion industry in 2018 and saw a growth rate of more than 28% between 2016 and the start of 2020.

So, while the VoIP industry was on track to become the new normal, the Coronavirus pandemic that began in early 2020 accelerated VoIP adoption.

A nearly overnight increase in remote work left businesses scrambling to address remote communication needs.

VoIP was no longer an option, virtual phone software became a requirement.

 

Omnichannel routing and unified communications, powered by VoIP technology, allowed remote teams to connect with one another and clients via multiple channels on any device.

 

Integration with CRM software that provided essential customer history on incoming callers became another essential feature of VoIP phone systems.

Most recently, Artificial Intelligence’s role in VoIP has transformed from optional to fundamental. Conversation AI alone is said to save companies $80 billion in labor costs by the end of 2026.

Conversational AI, machine learning, Natural Language Understanding, automation, and more anticipate customer needs and simultaneous customer queries without involving a live agent.

Virtual assistants and chatbots are now staple integrations with VoIP systems, cutting wait times and streamlining customer service.

Omnichannel customer self-service is one of the most important VoIP features to look for when selecting a provider, especially given the rising customer demand for automated support.

 

 

 

The Future of VoIP

As VoIP continues to branch out and integrate with emerging technologies like augmented reality (AR), virtual reality (VR), and the Internet of Things (IoT), it promises to redefine the way we communicate.