VoIP stands for Voice Over IP. It’s a set of technologies which enable the transfer of telephone conversations through the basic Internet Protocol (IP). Other terms commonly associated with VoIP are Internet Telephony, IP Telephony.
In traditional telephony services voice is converted into an electronic signal which is transmitted via telephone’s company network. Then the signal is converted through the telephone receiver into sound. In VoIP telephony, as any other information sent via the Internet, voice is converted into data packets , encoded , sent as data files , and decoded back into sound by a computer or other device ( e.g VoIP phone).
Charging occurs when online data is converted and connected to the traditional telephone system destination. This fact makes VoIP Telephony Service much cheaper than traditional telephony where charges will be on both sides ( Destination network , Source network ).