The increased usage of bandwidth services, availability of new and existing networks and the rapid convergence of voice and data demand new products and services from Voice over Internet Protocol, or VoIP. These needs are further compounded by decreasing prices and the higher demand on the quality of service. With competition coming from major telecom providers, Internet service providers and VoIP providers, the core differentiating factor is the higher value-added services.

At the consumer level, there are services specifically tailored for individual customers (or residential customers), SOHO users, small businesses and large corporations. Depending upon the type of customer, the services could include providing infrastructure like hardware devices, soft phones, inbound and outbound termination and also bundling of all services. At the individual level, software-based service is also evolving rapidly.

Some of the specialized services include providing fax facility and emergency services through 911. Peer-to-peer services bypass the central service provider by letting clients communicate directly with each other. Other than networking with PSTN lines for traditional calls, there are some services that provide connectivity to GSM networks.

Software-based services provide PC to phone connections by registering with websites of the service provider, which allows downloading of software for free. They also charge minimal rates for calls outside of the subscriber base. The call may be to a local number, or it may be a long-distance call, international call or a call to a mobile phone. The calling rate depends on the service provider.

Some of the features are like that of PSTN. They include billing facilities, but may not offer directory listings. As VoIP services depend upon routers, the limitation is that services dont work during power outages.

VoIP services face a number of issues in providing quality service. The major issue is the delay of the packet in reaching the destination, which results in the lack of synchronization between speakers. In some cases, packets are lost due to overload and congestion in the network, resulting in the loss of voice data. The reliability of a service is determined by the routing of packets through alternate paths, even when the router fails or malfunctions. Lastly, security is of high priority as the voice communication devices may be hacked with malicious intention.