Sending faxes over IP (or FoIP) is very different to voice over IP. One of the premises of voice over IP is that if the sound is changed a little bit by the network, it will not matter, because the human ear at the other end will still be able to hear and understand. This is similar to the principle behind MP3s - music is significantly compressed, but when played back to the human ear, it often sounds indistinguishable from the original. 

With a voice conversation, if very high frequencies get cut out, or if one part of the sentence arrives a few milliseconds late, or if very quite sounds aren't transmitted at all, the receiver is still able to understand perfectly what the other person is saying. Faxes, however, work on a different principle. Like a dial-up modem, they transmit data over the phone line, and in order for the computer (or fax machine) at the other end to be able to interpret what they are saying, the transmission needs to go through unaltered and uncompressed, otherwise it cannot be interpreted properly at the other end. At the very least this means that compression cannot be used for fax over IP.

More generally though, faxing over IP is possible, but has to be specifically supported. Many VoIP providers do not support faxing, purely because it adds more overheads to their network, and the benefits of FoIP are not as obvious as VoIP (namely, because there is no compression, and because faxing does not usually involve long phone calls, the savings are not as large).

If you want to get rid of your traditional fax system, you might want to consider an electronic fax service - receive and send faxes via email. There are many such services around.

Rumors of the fax machine's impending demise have been greatly exaggerated. Despite numerous predictions of the paperless office in the 1990s and the idea that e-mail and Adobe Acrobat render faxing obsolete, many people still rely on paper transmissions. Lawyers, doctors, and home-improvement contractors sending layouts back and forth to their customers use fax machines all the time, as does virtually any self-employed professional who needs to receive, sign, and return contracts.

Fortunately, most of these users can gain numerous benefits by going with an Internet fax service. You can send and receive faxes via e-mail, which means you can do it from work, home, or on the go, as well as view them online from your e-mail account whenever you wish. Received faxes come in as PDFs, so you can store them on your hard drive or resend them to another party. You can also send Microsoft Word documents, Excel spreadsheets, and more directly from applications without having to convert them first; we would like, however, to see printer drivers for MyFax (http://www.myfax.com) and Send2Fax (http://www.send2fax.com) as an alternative way of generating faxes. Currently, eFax (http://www.efax.com) is the only service to offer a proper print driver. And even though the services charge a monthly fee, the cost often works out to the same as or less than what you'd pay to maintain a separate dial-up line for a standalone fax machine.

The downsides are few. You'll need a scanner or an all-in-one printer in order to scan handwritten and signed documents into your computer before faxing. The printer doesn't need fax capabilities of its own, however; the Internet fax service takes care of that part. Some services charge by the fax, which can get expensive, though others include 100 or more pages free each month as part of the service fee.

There are probably more online faxing services available than you think, though not all are independent of one another. Two well-known Internet fax products, jFax and jConnect, are part of j2 Global Communications, which also distributes eFax. Other notable services include Electrosoft's 32-bit Internet Fax (http://www.electrosoft.com), ClickFax (www.clickfax.com), and MaxEmail (www.maxemail.com).