Put simply, VoIP is a subset of IP Telephony. IP Telephony, also commonly called Internet Telephony, is the area of communications that involves digital phone systems based on a number of IP (Internet) standards. It is a way of making a phone system digital in a way to take advantage of the Internet and of any hardware and applications attached to. The main aim of IP Telephony is to increase productivity, which suggests that the technology is better referenced in business environments.

On the other hand, VoIP is simply a digital transport vehicle for phone calls. In its different flavors, it works towards offering cheap or free calls and to add more features to voice communications.

To see it in a broader picture, think of IP Telephony as the overall concept and VoIP as a means of transmitting voice to implement this concept. An IP Telephony system can, for example, be an IP-PBX, which has VoIP and its standards (SIP, H.323 etc.) along with many other things (e.g. CRM), geared towards better productivity.

There are many other ways to put the difference simply. Avaya describes IP Telephony as the overall experience of communicating effectively and reliably using Internet protocols; this being achieved by harnessing the power of VoIP by virtue of the latter’s user-friendly features.

Quite subtle, the difference, isn’t it? I still think that using the two terms interchangeably can still be OK in many contexts, as long as readers want to be saved from the clinical differences.