Traditionally, voice traffic (telephony) has been transported using the circuit-switched, public switched telephone network (PSTN). Many large businesses and organizations also employed their own internal telephone system using a private branch exchange (PBX). Unfortunately, this meant that businesses not only had to deploy a separate network for data traffic (such as e-mail and Internet use), but also had to pay long-distance charges for calls to remote branches or partners.

IP telephony is a method for operating a telephony service over a data (IP) network. This has several advantages including:

- Reduced cost and complexity because there is only a single network to manage·
- Reduced long-distance charges (toll bypass)
- Ease of adding, or moving people around, because phone numbers are all provisioned in software rather than hardswitch connections
- Additional services such as directory look up, video conferencing, and call-center applications.