The History of VoIP and How It’s Changing Business Success for 2022 and Beyond


Whilst the technology for telephones has been with us for over 100 years, it’s only been recently that it has had an upgrade with the advent of the Internet. This has come in the form of VoIP, or voice-over-internet-protocol. Let’s delve into what VoIP is and how it’s transformed the telephony landscape.

When Was VoIP Invented?

The voice-over-internet-protocol (VoIP) system as we know it today first came about in the 1990s, but the roots of this technology can be traced back as far as 1938, when the world’s first voice synthesizer was created. Known as the Vocoder, it was capable of emulating human speech and the concept was similar to the packet transmissions that are used to send and recreate voice samples today.

The Rise of the Internet

The first network to use packet-switching and one of the earliest users of TCP and IP network protocols was a research project known as ARPANET in 1969 but it wasn’t until 1973 that the first voice data packet was transmitted. It was this voice transmission, using linear predictive coding (LPC) that really laid the groundwork for today’s modern VoIP phone system. 

By the early 1980s, researchers were using LPC to facilitate conference calls and set up an interface with the Public Switched Telephone Network (PSTN) but, despite this progress, the internet remained off-limits to most companies and individual users. 

Although the first large-scale internet provider launched in 1975, it wasn’t until 1980 that an online chat service was available to users, and it took until 1990 for more internet providers to get on board and make the web accessible to a wider audience. 

Improving Speech Quality Online

When the G.722 wideband audio codec was approved in 1988, it was a major step forward in online voice communication. This codec significantly improved the quality of online speech. In fact, the 64kbit/s quality delivered voice quality that was comparable to calls made over a regular PSTN line. 

In 1989, the RASCAL system was developed, which allowed gamers to communicate via voice over dial-up networks. Further developments led to NetFone, the first software-based VoIP phone available to the public. 

VoIP Phone Take Off

As the internet became more widely used throughout the 1990s, VoIP phone systems came into their own. Following the launch of the Free World Dialup system in 1994, the first commercial VoIP system was released in 1995. While users paid to register and per minute for calls, these early VoIP phone systems allowed people to save a considerable amount on long-distance and international calls. 

In the mid-nineties, a hosted PBX solution was widely available, although it relied on PSTN, and the first version of SIP was also developed. It wasn’t long until the voice calling software we recognise today came along. 

It’s hard to believe that Skype is almost 20 years old, but it really did launch in 2003, albeit as a voice-only communication service at first, with many other competing services following suit. By 2006, the addition of Wi-Fi connectivity to mobile phones meant that mobile VoIP calling was the order of the day, with major phone manufacturers releasing VoIP apps. 

Business VoIP Phones and Video Calls

As VoIP calling increased in popularity and internet speeds became even faster, businesses were quick to recognise the opportunities that VoIP phones offered. With low-cost per-minute rates or all-inclusive bundles, companies could reduce their costs while providing employees with user-friendly resources. 

Of course, the technological revolution didn’t stop there, and it wasn’t long before VoIP phone systems offered more than simply voice calls. Instead, providers integrated additional features into their software, such as call waiting, video conferencing and instant messaging. 

Unified Communications in the Modern Era

Now, a business VoIP system allows you to communicate in a myriad of ways. In fact, companies can access all the functionality they need via unified VoIP-based communications. From CRM integrations and email transcripts to call recording and data analysis, today’s phone VoIP systems are an effective communications solution for start-ups, growing businesses and enterprise-level companies. 

What are the Benefits of a VoIP System?

As VoIP technology has evolved, it has come to offer an increasingly broad selection of benefits, particularly to business users. If you’re wondering whether VoIP phones are a viable option for your business, take a look at some of the advantages a VoIP phone system can offer:


A VoIP phone number isn’t tied to a particular device or a specific location, which means you can choose and retain a number for as long as you like. Keeping the same business number is important if you want to ensure your customers can contact you, and ‘porting’ your VoIP number is an easy way to keep your contact details consistent.


Today’s workers operate from a variety of locations, which makes portability a top priority. As VoIP calls can be routed to any VoIP-enabled device, including smartphones, laptops, and tablets, it’s a highly mobile method of communication.

Reduced Costs

Switching to a business VoIP phone system can lower your operating costs and allow you to reduce the amount you spend on company communications. With all-inclusive packages or pay-per-call options, you can stay in control of your budget and get more for your money.


With a VoIP phone system, you can add extra lines at any time, and you won’t even need to purchase dedicated hardware. Any VoIP-enabled device can be used, which means you can grow your communications network in line with your company’s development.

Customer Service

A VoIP-based system won’t just facilitate voice calls; it will deliver an enhanced customer service experience. From auto attendants to directory services and call parking, you can elevate your company’s customer service simply by activating the features that are available via your VoIP system. 

Are You Ready to Succeed with VoIP?

With so many advantages associated with VoIP phones, it’s easy to see why so many companies are embracing the technology. To find out how VoIP can work for you, contact DRC now on 01256 895895 or email our team at [email protected].