The term "internet phone" can have different shades of meaning. For highly evolved gearheads, an internet phone is a self-hosting application that lets others call through to the host's PC. This peer-to-peer set-up is one cheap way to stay in contact from anywhere in the world.

For others, an internet phone is any phone that's programmable and customizable over the Web. This is the more common web phone out there since the average consumer isn't well versed in networking and other IT skills. For them, the Web's most useful application when it comes to telephony is an interface that lets their devices communicate seamlessly.

How an Internet Phone Works

In its latter definition, the internet phone lets users quickly and easily make international phone calls (or domestic calls, for that matter) by configuring their accounts on the Web. Once you sign up with a long distance calling provider, you can download that company's software from the Internet, then program your phone the same way you would a regular cell phone. Only instead of entering your most-dialed numbers into your phone, you enter them into your computer.

Then, when it's time to make a call, your software recognizes the number from which you're dialing and knows to charge you at the agreed-upon rate. You may have a few questions about how this works, what restrictions are in place, and what rates are available. Read on for a fuller explanation of this new technology and answers to some of the most common questions.