Since the revolution and advancement of technology, modern ways of communication are also being adopted by users. Now, people use the internet to communicate with each other. Communication over the internet provides more advanced features like video conferencing, video calling, image sharing options, location sharing, audio messages, video sharing, and file sharing. VoIP System is a technology that is used today for communication. The abbreviation of VoIP is Voice over Internet Protocol. It also means any form of communication that is happening over the Internet.
Although VoIP has revolutionzied contemporary telecommunication, the history of VoIP and Internet telephony began nearly a century ago at Bell Laboratories. This detailed blog will discuss the history of VoIP and Internet telephony.
1925: The Roots of VoIP Technology
VoIP’s history began in 1925 when the Western Electric Company and AT&T’s engineering department collaborated to establish the Bell Laboratory.
Bell Lab was established to invent, design, and improve the technologies that allow AT&T to expand its communications operations and services nationwide.

In 1928, Homer Dudley, an engineer at Bell’s Lab, created the Vocoder, the first electronic voice synthesizer. The Vocoder generated electronic sounds using oscillators, filters, and noise generators and amplified them alongside manual keys and pedals to adjust sound pitch and tone. It recreated human speech when operated correctly, laying the foundation for audio codecs and modern speech.
Dudley’s Voder debuted at the New York World’s Fair in 1939. Attendees were fascinated by its ability to analyze and generate comprehensible speech, adjust inflexion, and speak in different pitches.
Because it could encrypt voice messages, the Vocoder was used in the SIGSALY system during World War Two to facilitate secure Allied communications.
The Vocoder’s innovation began the voice synthesis revolution. In 1966, Japanese scientists used it to develop linear productive coding (LPC), the first step in successfully converting standard speech into transmittable digital voice signals.
Today’s versions of Dudley’s Vocoder serve various purposes, including digital voice scrambling, enhancing VoIP security through data encryption, and functioning in cochlear implants. Even the German electronic band Kraftwerk incorporated sounds created by Vocoder into their music.
1969: The ARPANET is Built
You can’t have Internet calling without a stable Internet connection. The Internet began just like an academic research project in 1969.
ARPA, or the Advanced Research Project Agency, was a US Department of Defence agency dedicated to military technology. Given the political climate at the time, DARPA wanted to create a network of interconnected computers that could help people communicate with each other at any time from anywhere in the world.
They wanted to create something we call the “Internet” today.
ARPA wanted to create a communication network that could survive physical destruction, streamline high-quality communication and expand computer access to researchers worldwide.
The network required functionality that operated independently from dedicated end-to-end circuit connections. Instead of choosing fixed pathways, adaptive systems were required to find quick and trustworthy ways for data exchange between endpoints.
The solution proved effective was packet switching, which distributes and receives limited data packets through independent digital systems rather than conventional copper-based circuits and phone connections.

In 1970, ARPANET emerged as a network preceding the Internet through ARPA to implement communication using standards in IP network protocols linked to packet-switching technology.
ARPANET employed routers instead of circuits because they served as evaluators to select rapid data communication paths. To prevent communication interruptions, ARPANET created a standardized approach to data packaging: the TCP and IP protocol connections suite.
Historians recognize Vint Cerf, Bob Taylor and Bob Kahn as creators of the foundational Internet protocol suite that built the first universal network. (Sorry, Al Gore.)
ARPANET permanently ceased operations in 1990.
1973: First Voice Data Packet Transmitted
In 1973, ARPANET ultimately linked 40 computers throughout many United States locations, including Harvard, UCLA, and MIT.
Linear Predictive Coding emerged as the primary focus of ARPANET development, as it facilitated voice calls via a virtual network, representing a significant advancement beyond digital communication.
Linear Predictive Coding, the cornerstone of contemporary VoIP technology, is a speech analysis technique that:
- Turns audio/speech into digital packets (compression)
- The digital network transmits data through packages of information.
- The data packages convert back into destination audio speech after being decompressed.
In 1973, Bob McAuley,h Ed Hofstette,r and Charlie Rada,r transmitted the initial voice packet through ARPANET at MIT’s Lincoln Lab. During the following year, Lincoln Lab and Culler Harrison, Inc. carried out successful test voice data packet transmissions to each other, marking the first implementation of two-way VoIP applications.

In 1976, Culler Harrison linked up with Lincoln Labs for their initial conference call on LPC. In 1982 the team reached a significant achievement when they combined local cable network connectivity with mobile packet radio systems and PSTN (Public Switched Telephone Network) interface capabilities.
The law prohibited personal usage of the Internet during this period. The moment computer enthusiast Lenoard Kleinrock sent his electric razor inquiry in 1973 stands as the first recorded “symptom” of cybercrime. Although digital communications expanded in the first half of the 1970s, most firms and ordinary citizens could not access the rudimentary structure of what became the Internet.audio net, and a Public Switched Telephone Network (PSTN) connection.
Using the Internet for personal purposes was against the law during this period. Thus, the first recorded “cybercrime” can be traced back to 1973 when user Leonard Kleinrock sent a message about his missing electric razor.
1975: CompuServe is Born
Even though digital communications began to expand in the early 1970s, most companies and individuals found it challenging to access this fundamental version of the Internet.
The commercial Internet service provider landscape began with CompuServe in 1975 under its parent company, Golden United Life Insurance.

The Internet access service operated by Golden United adopted a price structure analogous to time-sharing computing. Through this arrangement businesses received Golden United computer system access for Internet capabilities throughout their business day.
Independence came to CompuServe in 1975 and the company started its NASDAQ trading. The service found endorsement among companies utilizing Internet functionality while also acquiring the status that telephone networks profited AT&T. Continued communication between CompuServe users occurred through email messaging and electronic bulletin boards.
CompuServe established the groundwork for contemporary live chat software by launching the initial instant messaging service in 1980.
CompuServe did not experience real competition until the 1990s, and by then, it had started losing market share to its rivals. AOL purchased the company in 1997 to become its opponent’s property.
1988: The First Wideband Audio Codec
ITU-T blessed G.722 wideband audio codec in November of 1988 bringing superior call quality than previous standards permitted.

G.722 established a much wider audio speech bandwidth while measuring and storing audio data at twice the sampling rate.
The networking standard G.722 enabled up to 64 kbit/s data rates, which are optimal for VoIP communication, particularly on LANs.
The voice quality of the transmission received a rating indicating that it matched toll quality standards similar to those of the PSTN phone system.
1989-1991: First VoIP Application Released as Public Domain
This initial application designed for VoIP purposes served no functions for business purposes.
Luke Dormitzer’s real-time audio speaker application sent voice messages through Ethernet networks, allowing video game players to talk to each other during gameplay sessions. RASCAL originated from Brian C. Wiles’s 1989 development.

John Walker (the founder of Autodesk’s architecture software alongside its engineering software and other specific platforms) established his company’s European presence in 1991.
At that technological period, voice applications demanded a transmission speed of 64 Kb/s. Through his decimation/expansion scheme, Wiles transformed the bandwidth requirements to merely 32 Kb/s.
He provides the program for free usage to the public under the Public Domain title NetFone.
The VoIP phone innovation started from Netphone’s origins, which later changed to Speak Freely. The primary function Walker applied the system for involved listening to internal company meetings and communicating between programmers.
1993: First Video Telepresence System
The original telepresence system, Teleport, became TeleSuite before the arrival of Skype and Zoom.

The founders of Teleport, David Allen and Herold Williams, purposefully built this initial video conference system to boost profits for their high-end resort business.
Analyzing their guest behavior led hotel owners to discover frequent business connections that required customers to undergo shortened hotel stays.
People can establish real-time facial communication through video conferencing technology across Internet-connected networks.
The company software attracted Hilton Hotels to become their initial major customer.
The agreement eventually collapsed. However, Allen acquired all TeleSuite assets and redirected them to Polycom just a few years later, in 2007.
1994-1995: Free World Dialup + For-Profit VoIP
Jeff Pulver and his colleagues Brandon Lucas and Izak Jenie established Free World Dialup (FWD) in 1994. It became a VoIP business operating service and a free initiative.
Eventually, free VoIP numbers reached their natural expiration period.

In 1995 VocalTec Communications founders developed the first commercial voice over Internet Protocol application they named VocalTec Internet Phone.
Running H.323 protocol required users to have a 486 computer processor, 8MB RAM, a 16-bit soundcard and an SLLP or PPP connection.
At the time, this system represented top-level technology despite its minimal specifications.
Despite charging fees for registration, per-minute use, and showing ads before calling, VocalTec still offered its users lower rates than international and long-distance phone services.
Audio calls suffered from poor sound quality alongside regular dropouts because of slow bandwidth speeds and significant delays with dropped network packets.
These technical obstacles prevented VoIP technology from becoming an immediate market hit. At that time, first-generation Voice over IP telecommunications applications represented only one per cent of all telephone communication.
1997-1999: Hosted PBX and SIP Development
A San Francisco research facility built the initial hosted PBX solution in 1997. A team initially developed this PBX system with IP technology to offer dietary advice using phone keypress data entered in response to recorded prompts.
Service provider VirtualPBX operates through Internet connections, allowing users to receive and make phone calls from any location without needing physical on-site communication systems.
At launch, VirtualPBX offered its customers top-tier calling capabilities, including web portal access and Find Me/Follow Me functionality.

Virtual PBX offsite solutions introduced a technology that permanently marginalized traditional landlines and analog phones.
In 1999 Mark Spencer created Asterisk, rapidly gaining industry popularity as an open-source IP PBX program. Asterisk’s continual advancement by a worldwide developer community revealed multiple VoIP and PBX landscape issues.

SIP originated from the industry’s need to create a standardized communication protocol system because virtual communications continued to advance.
In 1996, the Internet Engineering Task Force authorized the establishment of SIP (Session Initiation Protocol), which established Internet-enabled communication protocols between IP devices.
VoIP technology deployment requires SIP protocols that establish and control interactions among communication points from setup through maintenance to connection termination.
To create and terminate these connections, SIP examines:
- User Location: The actual physical region where users connect exists
- User Availability: Availability of the target user as a condition for initiating a call
- User Capability: The system demands parameters and additional protocols to enhance communication capabilities, but what should those specifications entail?
- Call Setup: Telphony connection between users begins when their telephones produce ring signals.
- Call Handling: The struts of connection maintenance occur alongside proactive update handling throughout any active call period and involve final connection termination.
Mobile VoIP providers selected SIP over H.323 because SIP demonstrated superior scalability features.
SIP’s original purpose as an IP voice-calling management system now supports multiple telecom capabilities, including video conferencing and business texting, which serve business phone systems.
2003-2004: Skype and Vonage
The organization known as Skype launched under the name Sky Peer-to-Peer in 2003 when it established its base in Estonia. By 2005, it had 50 million users.
Skype’s first service allowed its users to call other PC users free of charge yet enforced fees upon those accessing the public telephone network.

The original phone service, which started as an audio contact platform, developed into a service that added video calling features, file transfers, and text communication capabilities.
The company, known initially as Sky Peer-to-Peer launched in 2003 before eBay purchased it in the same year, then Microsoft acquired it in 2011.
Numerous Skype derivatives appeared on the market, including Vonage for Business (VBC), which launched in 2004 and reached approximately 2 million subscribers in 2006.
2004: The FCC Weighs In
The regulations which governed VoIP calling remained unclear before this point.
The Federal Communications Commission, under Chair Michael Powe,l designated VoIP services as information services instead of phone services, thus granting VoIP a lower tax burden for customers in 2004.
Under federal law implemented in 2005, all VoIP services needing access to PSTN networks must provide Enhanced 911 (e911) calling capability.
E911 calls connect VoIP phone system users to particular locations, allowing emergency call center dispatchers to receive exact service location information.
Following the declaration of VoIP’s information service status, new regulations encompassing call recordings, telemarketing, and spam restriction laws were implemented.
2005-2006: The Rise of Mobile VoIP
The mobile phone market received its first networking-enabled device when Calypso Wireless introduced the C1250i in 2005.
With the C1250i, users experienced automatic switching between cellular towers and Wi-Fi networks, enabling live video meetings and Internet Protocol telephone communications.

In 2006, the Truphone, the first mobile VoIP, was launched for Nokia phones, iPhone, Android, and Blackberry users.
This app enables users to make free calls within the network and send free in-network and VoIP calls through the PSTN. Instead of relying on cellular networks, it utilizes SIP for Internet-based calls.
2010-2016: VoIP Goes Mainstream
By 2012, hosted VoIP telephone services grew roughly 17% per year, while SIP trunking saw an 83% growth from 2011-2012.
By 2015, many businesses were either transitioning to VoIP voice calls or already had an IP telephony network in their office.
It had become such a large market that AT&T petitioned the FCC to require VoIP companies to stop using copper wires instead of fibre optic cables and IP switches.
2016-2024: Remote Work, VoIP and Unified Communications
In 2018, VoIP technology had already become a $20 billion industry in the United States, with a growth rate of more than 28% between 2016 and the beginning of 2020.

So, while the VoIP industry was on track to become the new normal in the market, the Coronavirus pandemic hit the world in 2020 and accelerated the adoption of VoIP in the business sector and in many other spheres of life.
An overnight increase in remote work is forcing businesses to adopt virtual communication. Every business is adopting VoIP communication to communicate with employees from different locations.
VoIP is no longer an option, it has become a necessity of life.
Omnichannel routing and unified communication powered by VoIP technology allowed remote teams to connect and clients via multiple channels on any device, including:
- Video chat
- Softphones apps
- Multiple phone lines
- Team chat messaging
- Website chat
- Virtual voicemail
Another essential feature of VoIP is its integration with CRM software, making it a perfect communication tool. Most recently, Artificial Intelligence has also transformed VoIP communication.
Virtual assistants and chatbots play a key role in VoIP systems, cutting wait times and streamlining customer service.
The Future of VoIP
Voice over Internet Protocol (VoIP) is rapidly evolving, shaping the way businesses and individuals communicate. As technology advances, VoIP is expected to become more efficient, cost-effective, and feature-rich. With the rise of 5G networks, artificial intelligence (AI), and cloud-based solutions, VoIP will offer higher call quality, enhanced security, and seamless integration with other digital tools. Innovations such as AI-powered voice assistants, real-time language translation, and advanced analytics will further enhance user experience. As businesses continue to embrace remote work and global collaboration, VoIP will play a crucial role in the future of communication, making traditional phone systems obsolete.
Emerging Technologies
The future of VoIP is intrinsically tied to technological advancements, with several key innovations promising to enhance its capabilities. The rollout of 5G networks is expected to be a game-changer, providing faster speeds, greater bandwidth, and ultra-low latency. This will ensure that VoIP calls are more reliable and quality, even in high-demand scenarios like video conferencing or large-scale virtual meetings.
Additionally, edge computing is set to complement VoIP systems by processing data closer to the user, reducing delays and improving performance in real-time communication. Artificial Intelligence (AI) is another transformative force, enhancing features like voice recognition, sentiment analysis, and predictive routing. AI-driven chatbots and virtual assistants integrated into VoIP systems are already streamlining customer interactions and business operations.
Potential Applications
VoIP is evolving beyond traditional communication to power various applications in various sectors. One of the most promising developments is its integration with the Internet of Things (IoT). Imagine a future where smart devices in your home, like your refrigerator or thermostat, can communicate seamlessly via VoIP to notify you of updates or allow you to issue voice commands remotely.
In healthcare, VoIP combined with IoT devices can enable telemedicine solutions. Patients can consult doctors remotely, and wearable devices share real-time health data. VoIP-powered virtual classrooms can provide a more interactive and inclusive experience, connecting teachers and students worldwide.
Final Words-History of VoIP and Internet Telephony
From its humble beginnings in analog telephony to the cutting-edge AI-driven systems of today, VoIP has come a long way. It has redefined communication and bridged gaps between people, businesses, and cultures worldwide. By leveraging the power of the Internet, VoIP has made communication faster, more affordable, and accessible to virtually anyone with an Internet connection.
The journey of VoIP is a testament to human ingenuity and the relentless pursuit of innovation. From early experiments with packet-switching to integrating advanced features like AI-driven call management and real-time translation, VoIP has continuously adapted to meet the demands of an increasingly connected world. Today, it’s essential for personal and professional communication, driving remote work, enhancing customer service, and even powering the next generation of IoT devices.
FAQ's
Q1. What does VoIP stand for?
VoIP, which stands for Voice over Internet Protocol, enables voice communication.
Q2. How is VoIP different from traditional telephony?
Unlike traditional telephony, VoIP uses the internet to transmit voice data, making it more cost-effective and flexible.
Q3. What was the first VoIP application?
VocalTec released the first commercial VoIP application in 1995.
Q4. Can VoIP work without the internet?
No, VoIP requires an internet connection to function.
Q5. What is the future of VoIP?
The future of VoIP includes integration with emerging technologies like 5G and IoT, promising even more innovative applications.