Voice Over IP (VoIP) allows you to make voice calls using your internet connection. VoIP typically replaces the traditional PSTN based system and can connect your business' sites (including off site / mobile workers) into a single converged network.
VoIP will save you money by combining voice and data on one network that can be centrally managed, whilst charges for calls between locations can be vastly reduced or negated.
IP telephony works by converting voice communications into data packets. Telephones are connected to data ports on the IP network. But the function of a telephone system can easily be provided using a device that is already connected to the network - the PC.