UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                    FORM 8-K

                                 CURRENT REPORT

                     PURSUANT TO SECTION 13 OR 15(d) OF THE

                         SECURITIES EXCHANGE ACT OF 1934

        Date of Report (Date of earliest event reported): October 5, 2005

                                   VOIP, INC.
                                   ----------
             (Exact name of registrant as specified in its charter)

        Texas                       000-28985                   75-2785941
        ------                      ----------                  ----------
(State of Incorporation)       (Commission File No.)         (IRS Employer
                                                           Identification No.)

         12330 SW 53rd Street, Suite 712, Ft. Lauderdale, Florida 33330
         --------------------------------------------------------------
          (Address of principal executive offices, including zip code)

                                 (954) 434-2000
              ----------------------------------------------------
              (Registrant's telephone number, including area code)

<PAGE>

Item 2.01  Completion of Acquisition or Disposition of Assets

      On October 5, 2005,  VoIP,  Inc. (the  "Company")  and WQN,  Inc.  ("WQN")
closed the transactions  under the Asset Purchase Agreement (the "Asset Purchase
Agreement"), dated August 3, 2005. VoIP Acquisition Company ("Acquisition Sub"),
a  wholly-owned  subsidiary  of the Company,  purchased  (the "Asset  Purchase")
substantially  all of the assets of WQN relating to WQN's  "voice over  internet
protocol"  business (the  "Assets").  A copy of the press release  regarding the
closing of the Asset Purchase is filed as Exhibit 99.1 hereto.

      Concurrently with the execution of the Asset Purchase Agreement, on August
3, 2005,  WQN had advanced to the Company  $1,000,000,  pursuant to a promissory
note (the "Bridge  Note").  The Bridge Note was cancelled upon completion of the
transaction. In connection with the Bridge Note, the Company had issued to WQN a
warrant (the "Bridge Warrant") to purchase 625,000 shares of Common Stock, at an
exercise  price of $1.37 per share.  The Bridge  Warrant was also  cancelled  in
connection with the completion of the transaction.

      Pursuant  to a letter  agreement,  dated  October  5,  2005  (the  "Letter
Agreement"),  WQN agreed to reimburse the Company for accounts  receivable  that
are not  collectible  within  60  days of the  Closing.  If WQN is  required  to
reimburse the Company for accounts  receivable  not  collected  within the sixty
days, the Company will issue WQN a number of shares of its common stock equal to
the  amount  of such  reimbursement  divided  by two (2).  A copy of the  letter
agreement is filed as Exhibit 10.1 hereto.

The Acquired Business

      Prior to the purchase of the Assets by the Company,  WQN was a "voice over
internet  protocol"  ("VoIP")  telephony  company providing  international  long
distance  services.  VoIP  enables  voice  communications  over the  Internet by
compressing  voice into data packets that can be  efficiently  transmitted  over
data networks and then converted back into voice at the receiving end. Customers
use the VoIP services platform to make and receive calls using their home phone,
business  phone,  personal  computer and mobile  phone.  The  acquired  business
currently includes the provision of enhanced  Internet-based and other telephony
services under various brand names to individual  consumers primarily seeking to
make international calls as well as the provision of enhanced Internet-based and
other telephony services to resellers,  corporations and service providers under
their  brand  names and carrier  transmission  services  whereby WQN sold excess
capacity to other  long-distance  carriers.  After the acquisition,  the Company
will also distribute  telephony  services,  including  prepaid long distance and
prepaid wireless, through a network of private distributors.

      The  primary  source of  revenue  that will be derived  from the  acquired
Assets is the fees that the Company will receive from  telephony  customers  for
completing  calls over the  network and from the sale of  telephony  products to
WQN's former network of distributors in the Southern California market. Internet
telephony  revenue is dependent on the volume of voice traffic  carried over the
network, which is measured in terms of minutes of voice traffic and the fees per
minute of traffic  we charge our  customers.  The  Company  will bill its retail
customers on a prepaid basis through credit cards.

      Costs of telephony  revenue consist  primarily of data  communication  and
telecommunication expenses to terminate long distance traffic over our networks,
which vary  proportionately with the volume of traffic carried over our network.
These costs  include  Internet  related  expenses to send voice traffic over the
Internet, fees the Company will to terminate calls, fees the Company will pay to
utilize the traditional  telephone network to terminate calls, expenses incurred
to connect  customers to our network,  and fees paid to other service  providers
for the purchase of telecom and other products.


                                     - 2 -
<PAGE>

      Using the  acquired  Assets,  the Company  will market  various VoIP based
telephony services primarily to residential  consumers,  which is categorized as
retail  telephony.  A substantial  portion of retail telephony  business will be
derived from the sale of services to customers calling from the United States to
India.  The  centrally  managed  enhanced  services  platform  acquired from WQN
supports a full range of customer  products and services  that enhance  quality,
lower costs and improve ease of use and management.  The new telephony  services
acquired from WQN will allow users to access the Company's VoIP platform to make
low cost calls to anywhere in the world. Below are the key products and services
acquired from WQN.

Products

      RocketVoIP.  The acquired  proprietary  next  generation  VoIP  technology
service  is  marketed  under  the  brand  name   RocketVoIP.   With  RocketVoIP,
subscribers  can use  their  broadband  service  to make and  receive  unlimited
domestic and  international  calls using a home phone,  mobile phone or personal
computer.  RocketVoIP has unique features and advantages over competing products
that include:

      o     Unlimited  local,  long  distance  and  international  calling to 50
            countries, for a low monthly fee;

      o     The ability to use a mobile  phone to access the  Company's  network
            for high quality unlimited international calls;

      o     Free in-network calling;

      o     Free features including  Caller-ID,  Call-Waiting,  Call-Forwarding,
            3-Way Calling, Voice Mail, and more; and

      o     A total  calling  solution  enabling  travelers  to make and receive
            phone calls from anywhere in the world using a personal computer and
            high-speed internet access, including Wi-Fi hotspots.

      Easy Talk. The EasyTalk service offers  competitively priced long distance
services  which  allows  customers to speak to the party they are calling by the
pressing of two designated  buttons from the dial pad of the  customer's  phone.
Customers  are not  required  to  switch  their  long  distance  service  to use
EasyTalk. The EasyTalk service offers many features including:

      o     Pinless dialing;

      o     Can be used from registered home, office and mobile phones;

      o     Access to personal  on-line account  management  tools which enables
            customers to view their call history and purchase information 24 hrs
            a day;

      o     Recharge   their  accounts   on-line  or  through  our   Interactive
            VoiceResponse System (IVR);


                                     - 3 -
<PAGE>

      o     Update, modify and change their account information including credit
            card details; and

      o     Communicate with customer service representative by email, live chat
            or by calling a customer service number.

      My800online.com. The My800online.com service offers toll free personal 800
numbers  that can be routed to any home,  office or cell phone in the world.  It
allows  small   businesses  to  create  a  virtual  office  telephone  and  lets
international  companies  provide their U.S. based customers a toll-free  number
that will ring  anywhere  in the world.  The  My800online  service  offers  many
feature including:

      o     No monthly fees or contracts;

      o     International call forwarding;

      o     The ability to recharge the number on-line at any time; and

      o     Access to personal  on-line account  management  tools which enables
            customers to view account balance and call history 24 hrs a day.

      Virtual Prepaid Calling Cards.  The Company will use the Assets in part to
sell virtual prepaid calling cards over the Internet. These are virtual, because
no physical card is issued.  The virtual calling cards will give the Company the
flexibility  of promptly  changing the rates and features to respond to changing
consumer  demand,  rather than having an  inventory  of physical  cards with set
features that cannot be changed  until all are recalled or used.  This also will
allow the Company to offer and test several  different  types of virtual calling
cards with varying pricing  features,  thus providing a greater selection to its
customers.

      The system  functions  as  follows:  A  potential  customer  accesses  the
Company's Website, follows the prompts to enter their credit card information to
purchase the virtual  calling card, the Company  verifies the credit card within
seconds and electronically issues a personal  identification number, or PIN, and
a toll free number to the customer when the electronic  purchase  transaction is
completed.  Once sold, the virtual calling card can be used  immediately to make
international and domestic long distance calls. The customer dials the toll free
number and enters the PIN and the telephone  number the customer seeks to reach.
The enhanced  services platform  determines  whether the virtual calling card is
valid and the number of call minutes  remaining on it, based on the rate for the
country being called.  The platform completes the call and reduces the available
credit balance on the virtual calling card at the conclusion of the call.

      Resale of Virtual Calling Cards. The Company will also buy virtual calling
cards  processed  through  other  companies'  platforms  including  prepaid long
distance and wireless.  The Company will buy them at a discount and sell them to
its  customers  on its  Websites as virtual  cards.  The Company will sell these
virtual cards for calls from the United States to other  countries  where it has
not  established  its own Internet  network and where its negotiated  rates with
international  long  distance  carriers are not as favorable  and to offer other
telecom  products and services not  available on the  platform,  such as prepaid
wireless.


                                     - 4 -
<PAGE>

      Retail Telephony Websites.  The Company acquired various Websites from WQN
to allow it to  target  several  ethnic  niches  that  make  international  long
distance calls. The Websites are accessible 24 hours per day, seven days a week,
so the Company will not be constrained by the hours a retail store would be open
for  business.  The  Websites may also be reached  from the  customer's  home or
office. The customer is not required to physically travel to another location to
make a purchase and receive  delivery.  Online purchasing and delivery will also
allow the  Company  to  deliver  a broad  selection  of  products  to  customers
worldwide  in rural or other  locations  that do not have  convenient  access to
physical stores. The acquired Websites include the following:

Web Site Address                   Web Site Description
----------------------------       --------------------------------------------
www.wqn.com                        EasyTalk service and Corporate website
www.rocketvoip.com                 RocketVoIP service
www.my800online.com                Personal 800 service
www.valucomonline.com              High-end Indian consumers
www.valumaxonline.com              Indian market
www.card2asia.com                  Indian market
www.supertel.com                   Iranian market
www.metrotelcom.net                Iranian market
www.wqnwireless.com                Prepaid wireless plans
www.rocketmobile.net               International calling for mobile phone users

      The Websites have been designed around industry standard  architectures to
reduce  downtime  in the  event of  outages  or  catastrophic  occurrences.  The
Websites  operations  staff will consist of systems  administrators  who manage,
monitor and operate the Websites. The continued  uninterrupted  operation of the
Websites is essential to the  acquired  business,  and it will be the job of the
site  operations  staff  to  ensure,  to  the  greatest  extent  possible,   the
reliability  of the  Websites.  The network is built  around a  redundant,  high
availability  backbone. In order to achieve maximum redundancy,  the network has
several connections to the Internet.

Wholesale Services

      The  wholesale  services  that the Company will  conduct  using the Assets
consist of the following:

      Distribution of Telephony Products.  The Company will distribute telephony
services, which primarily consists of prepaid calling cards through a network of
over 90 private distributors.  The Company will sell the product or service to a
distributor  at a discount  who then  resells the product or service to a retail
outlet. Through this network the Company estimates it will sell products to over
10,000  retail  outlets of which more than 5,000  retail  outlets are located in
Southern  California  which will give the Company access to various large ethnic
communities  seeking to make international phone calls. A significant portion of
the  distribution  business  will consist of prepaid  calling cards used to call
from the United  States to Mexico.  Through  this  network the Company will also
distribute our products in the Dallas, Houston,  Chicago, New York City, Newark,
and Miami  markets.  The Company  plans to use this  network in 2005 to sell its
proprietary VoIP products.


                                     - 5 -
<PAGE>

      Platform Services.  The Company will sell the acquired  Internet-based and
other telephony services to resellers,  corporations,  and service providers who
then resell the service under their own brand name.  Many of these resellers are
smaller  companies which purchase  virtual calling cards from us and then resell
the products from their own web sites.

Services Platform and Network

      Access. Access to the newly acquired,  propriety VoIP Network and enhanced
services  platform is available  by several  methods.  Customers  can access the
network from anywhere in the world through their high speed Internet  connection
using a broadband phone (which the Company will supply to RocketVoIP  customers)
and the soft phone which is a  downloadable  software that enables  customers to
make  PC-to-Phone  calls.  Customers can also access the network from the United
States and Canada using toll-free and local access numbers.

      Enhanced Services Platform.  The Company acquired WQN's centrally managed,
enhanced  services  platform,   consisting  of  a  reliable  and  flexible  data
management,  monitoring  control and billing  systems  which  support all of its
products and services.  Key elements  include  customer  provisioning,  customer
access, fraud control,  network security,  call routing,  call monitoring,  call
reliability  and detailed  call  records.  The enhanced  services  platform is a
specialized  telephone switch, soft switch, and software. It is connected to the
Websites  and  databases  acquired  from WQN and to its network of outgoing  and
incoming  telephone lines and Internet  lines.  It sets up all customer  account
information  when services are purchased and immediately  activates the services
so it can be used at the time of  purchase.  Programmed  into the  platform is a
lowest cost routing matrix. This matrix  automatically routes each call over the
route  most   economical  to  the  Company.   This  means  it  will  select  the
international  carrier with the lowest rate or the Internet if the Company has a
gateway in the call destination country.

      Proprietary  Technology.  The Company acquired WQN's proprietary  customer
software that permits a customer to purchase retail telephony  services from the
acquired  Websites using a credit card and to have the services  delivered while
on the Websites for immediate use by the customer. Proprietary customer software
also allows  customers  access to our platform  using their high speed  Internet
connection to initiate and receive  calls,  and various  proprietary  credit and
fraud  management  applications  will aid the  Company  in  checking  credit and
limiting fraudulent transactions.

Item 3.02 Unregistered Sales of Equity Securities

      In connection with the closing of the  transaction,  the Company agreed to
issue WQN 500,000  shares of  restricted  common  stock  relating to  difference
between the amount of accounts receivable transferred in the transaction and the
accounts  payable.  The shares  issued  and  issuable  under the Asset  Purchase
Agreement and the Letter  Agreement  were made and will be made in reliance upon
an exemption from the registration  provisions of the Securities Act of 1933, as
amended  (the  "Securities  Act") set forth in  Section  4(2) and  Regulation  D
thereof,  relative to sales by an issuer not involving any public offering,  and
the rules and regulations thereunder.


                                     - 6 -
<PAGE>

Item 7.01 Regulation FD Disclosure

      Exhibit  99.1  hereto  is being  furnished,  and shall not be deemed to be
"filed" with the SEC. The  information in Exhibit 99.1 shall not be incorporated
by reference into any filing of the Company with the SEC, whether made before or
after the date hereof,  regardless of any general incorporation language in such
filings.

Safe Harbor

      Statements  about  the  Company's   future   expectations  and  all  other
statements in this Current Report on Form 8-K, other than historical  facts, are
"forward-looking statements" within the meaning of Section 27A of the Securities
Act, Section 21E of the Securities Exchange Act of 1934, as amended, and as that
term is defined in the Private  Securities  Litigation  Reform Act of 1995.  The
Company  intends  that such  forward-looking  statements  be subject to the safe
harbors created thereby.

      The above information contains information relating to the Company that is
based on the beliefs of the Company and/or its management as well as assumptions
made by, and information  currently available to, the Company or its management.
When  used in this  document,  the  words  "anticipate,"  "estimate,"  "expect,"
"intend," "plans,"  "projects," and similar  expressions,  as they relate to the
Company or its management, are intended to identify forward-looking  statements.
Such statements  reflect the current view of the Company regarding future events
and are subject to certain risks,  uncertainties and assumptions,  including the
risks  and  uncertainties   noted.   Should  one  or  more  of  these  risks  or
uncertainties  materialize,   or  should  underlying  assumptions  prove  to  be
incorrect,  actual results may vary materially  from those  described  herein as
anticipated,  believed,  estimated,  expected,  intended or  projected.  In each
instance,  forward-looking  information  should  be  considered  in light of the
accompanying  meaningful cautionary statements herein.  Factors that could cause
results to differ  include,  but are not limited to,  successful  performance of
internal  plans,  the impact of  competitive  services  and  pricing and general
economic risks and uncertainties.

Item 9.01 Financial Statements and Exhibits.

      (c)   Exhibits.

      99.1  Press Release, dated October 11, 2005

      10.1  Letter Agreement, dated October 5, 2005.


                                     - 7 -
<PAGE>

                                   SIGNATURES

      Pursuant to the  requirements of the Securities  Exchange Act of 1934, the
registrant  has duly  caused  this  report  to be  signed  on its  behalf by the
undersigned hereunto duly authorized.

Date:    October 11, 2005              VOIP, INC.
                                       (Registrant)

                                       By: /s/  Steven Ivester
                                           -------------------------------------
                                           Steven Ivester
                                           President and Chief Executive Officer


                                     - 8 -
{"company-data": {"conformed-name": "VOIP  INC", "cik": "0001100954", "assigned-sic": "3661", "irs-number": "752785941", "fiscal-year-end": "1231"}, "filing-values": {"form-type": "8-K", "act": "34", "file-number": "000-28985", "film-number": "051132248"}, "business-address": {"street1": "12330 SW 53RD STREET", "street2": "SUITE 712", "city": "FT. LAUDERDALE", "state": "FL", "zip": "33330", "phone": "954-434-2000"}, "mail-address": {"street1": "12330 SW 53RD STREET", "street2": "SUITE 712", "city": "FT. LAUDERDALE", "state": "FL", "zip": "33330"}, "former-company": {"former-conformed-name": "MILLENNIA TEA MASTERS INC", "date-changed": "19991213"}}
UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                    FORM 8-K

                                 CURRENT REPORT

                     PURSUANT TO SECTION 13 OR 15(d) OF THE

                         SECURITIES EXCHANGE ACT OF 1934

        Date of Report (Date of earliest event reported): October 5, 2005

                                   VOIP, INC.
                                   ----------
             (Exact name of registrant as specified in its charter)

        Texas                       000-28985                   75-2785941
        ------                      ----------                  ----------
(State of Incorporation)       (Commission File No.)         (IRS Employer
                                                           Identification No.)

         12330 SW 53rd Street, Suite 712, Ft. Lauderdale, Florida 33330
         --------------------------------------------------------------
          (Address of principal executive offices, including zip code)

                                 (954) 434-2000
              ----------------------------------------------------
              (Registrant's telephone number, including area code)
Item 2.01  Completion of Acquisition or Disposition of Assets

      On October 5, 2005,  VoIP,  Inc. (the  "Company")  and WQN,  Inc.  ("WQN")
closed the transactions  under the Asset Purchase Agreement (the "Asset Purchase
Agreement"), dated August 3, 2005. VoIP Acquisition Company ("Acquisition Sub"),
a  wholly-owned  subsidiary  of the Company,  purchased  (the "Asset  Purchase")
substantially  all of the assets of WQN relating to WQN's  "voice over  internet
protocol"  business (the  "Assets").  A copy of the press release  regarding the
closing of the Asset Purchase is filed as Exhibit 99.1 hereto.

      Concurrently with the execution of the Asset Purchase Agreement, on August
3, 2005,  WQN had advanced to the Company  $1,000,000,  pursuant to a promissory
note (the "Bridge  Note").  The Bridge Note was cancelled upon completion of the
transaction. In connection with the Bridge Note, the Company had issued to WQN a
warrant (the "Bridge Warrant") to purchase 625,000 shares of Common Stock, at an
exercise  price of $1.37 per share.  The Bridge  Warrant was also  cancelled  in
connection with the completion of the transaction.

      Pursuant  to a letter  agreement,  dated  October  5,  2005  (the  "Letter
Agreement"),  WQN agreed to reimburse the Company for accounts  receivable  that
are not  collectible  within  60  days of the  Closing.  If WQN is  required  to
reimburse the Company for accounts  receivable  not  collected  within the sixty
days, the Company will issue WQN a number of shares of its common stock equal to
the  amount  of such  reimbursement  divided  by two (2).  A copy of the  letter
agreement is filed as Exhibit 10.1 hereto.

The Acquired Business

      Prior to the purchase of the Assets by the Company,  WQN was a "voice over
internet  protocol"  ("VoIP")  telephony  company providing  international  long
distance  services.  VoIP  enables  voice  communications  over the  Internet by
compressing  voice into data packets that can be  efficiently  transmitted  over
data networks and then converted back into voice at the receiving end. Customers
use the VoIP services platform to make and receive calls using their home phone,
business  phone,  personal  computer and mobile  phone.  The  acquired  business
currently includes the provision of enhanced  Internet-based and other telephony
services under various brand names to individual  consumers primarily seeking to
make international calls as well as the provision of enhanced Internet-based and
other telephony services to resellers,  corporations and service providers under
their  brand  names and carrier  transmission  services  whereby WQN sold excess
capacity to other  long-distance  carriers.  After the acquisition,  the Company
will also distribute  telephony  services,  including  prepaid long distance and
prepaid wireless, through a network of private distributors.

      The  primary  source of  revenue  that will be derived  from the  acquired
Assets is the fees that the Company will receive from  telephony  customers  for
completing  calls over the  network and from the sale of  telephony  products to
WQN's former network of distributors in the Southern California market. Internet
telephony  revenue is dependent on the volume of voice traffic  carried over the
network, which is measured in terms of minutes of voice traffic and the fees per
minute of traffic  we charge our  customers.  The  Company  will bill its retail
customers on a prepaid basis through credit cards.

      Costs of telephony  revenue consist  primarily of data  communication  and
telecommunication expenses to terminate long distance traffic over our networks,
which vary  proportionately with the volume of traffic carried over our network.
These costs  include  Internet  related  expenses to send voice traffic over the
Internet, fees the Company will to terminate calls, fees the Company will pay to
utilize the traditional  telephone network to terminate calls, expenses incurred
to connect  customers to our network,  and fees paid to other service  providers
for the purchase of telecom and other products.

                                     - 2 -
Using the  acquired  Assets,  the Company  will market  various VoIP based
telephony services primarily to residential  consumers,  which is categorized as
retail  telephony.  A substantial  portion of retail telephony  business will be
derived from the sale of services to customers calling from the United States to
India.  The  centrally  managed  enhanced  services  platform  acquired from WQN
supports a full range of customer  products and services  that enhance  quality,
lower costs and improve ease of use and management.  The new telephony  services
acquired from WQN will allow users to access the Company's VoIP platform to make
low cost calls to anywhere in the world. Below are the key products and services
acquired from WQN.

Products

      RocketVoIP.  The acquired  proprietary  next  generation  VoIP  technology
service  is  marketed  under  the  brand  name   RocketVoIP.   With  RocketVoIP,
subscribers  can use  their  broadband  service  to make and  receive  unlimited
domestic and  international  calls using a home phone,  mobile phone or personal
computer.  RocketVoIP has unique features and advantages over competing products
that include:

      o     Unlimited  local,  long  distance  and  international  calling to 50
            countries, for a low monthly fee;

      o     The ability to use a mobile  phone to access the  Company's  network
            for high quality unlimited international calls;

      o     Free in-network calling;

      o     Free features including  Caller-ID,  Call-Waiting,  Call-Forwarding,
            3-Way Calling, Voice Mail, and more; and

      o     A total  calling  solution  enabling  travelers  to make and receive
            phone calls from anywhere in the world using a personal computer and
            high-speed internet access, including Wi-Fi hotspots.

      Easy Talk. The EasyTalk service offers  competitively priced long distance
services  which  allows  customers to speak to the party they are calling by the
pressing of two designated  buttons from the dial pad of the  customer's  phone.
Customers  are not  required  to  switch  their  long  distance  service  to use
EasyTalk. The EasyTalk service offers many features including:

      o     Pinless dialing;

      o     Can be used from registered home, office and mobile phones;

      o     Access to personal  on-line account  management  tools which enables
            customers to view their call history and purchase information 24 hrs
            a day;

      o     Recharge   their  accounts   on-line  or  through  our   Interactive
            VoiceResponse System (IVR);

                                     - 3 -
o     Update, modify and change their account information including credit
            card details; and

      o     Communicate with customer service representative by email, live chat
            or by calling a customer service number.

      My800online.com. The My800online.com service offers toll free personal 800
numbers  that can be routed to any home,  office or cell phone in the world.  It
allows  small   businesses  to  create  a  virtual  office  telephone  and  lets
international  companies  provide their U.S. based customers a toll-free  number
that will ring  anywhere  in the world.  The  My800online  service  offers  many
feature including:

      o     No monthly fees or contracts;

      o     International call forwarding;

      o     The ability to recharge the number on-line at any time; and

      o     Access to personal  on-line account  management  tools which enables
            customers to view account balance and call history 24 hrs a day.

      Virtual Prepaid Calling Cards.  The Company will use the Assets in part to
sell virtual prepaid calling cards over the Internet. These are virtual, because
no physical card is issued.  The virtual calling cards will give the Company the
flexibility  of promptly  changing the rates and features to respond to changing
consumer  demand,  rather than having an  inventory  of physical  cards with set
features that cannot be changed  until all are recalled or used.  This also will
allow the Company to offer and test several  different  types of virtual calling
cards with varying pricing  features,  thus providing a greater selection to its
customers.

      The system  functions  as  follows:  A  potential  customer  accesses  the
Company's Website, follows the prompts to enter their credit card information to
purchase the virtual  calling card, the Company  verifies the credit card within
seconds and electronically issues a personal  identification number, or PIN, and
a toll free number to the customer when the electronic  purchase  transaction is
completed.  Once sold, the virtual calling card can be used  immediately to make
international and domestic long distance calls. The customer dials the toll free
number and enters the PIN and the telephone  number the customer seeks to reach.
The enhanced  services platform  determines  whether the virtual calling card is
valid and the number of call minutes  remaining on it, based on the rate for the
country being called.  The platform completes the call and reduces the available
credit balance on the virtual calling card at the conclusion of the call.

      Resale of Virtual Calling Cards. The Company will also buy virtual calling
cards  processed  through  other  companies'  platforms  including  prepaid long
distance and wireless.  The Company will buy them at a discount and sell them to
its  customers  on its  Websites as virtual  cards.  The Company will sell these
virtual cards for calls from the United States to other  countries  where it has
not  established  its own Internet  network and where its negotiated  rates with
international  long  distance  carriers are not as favorable  and to offer other
telecom  products and services not  available on the  platform,  such as prepaid
wireless.

                                     - 4 -
Retail Telephony Websites.  The Company acquired various Websites from WQN
to allow it to  target  several  ethnic  niches  that  make  international  long
distance calls. The Websites are accessible 24 hours per day, seven days a week,
so the Company will not be constrained by the hours a retail store would be open
for  business.  The  Websites may also be reached  from the  customer's  home or
office. The customer is not required to physically travel to another location to
make a purchase and receive  delivery.  Online purchasing and delivery will also
allow the  Company  to  deliver  a broad  selection  of  products  to  customers
worldwide  in rural or other  locations  that do not have  convenient  access to
physical stores. The acquired Websites include the following:

Web Site Address                   Web Site Description
----------------------------       --------------------------------------------
www.wqn.com                        EasyTalk service and Corporate website
www.rocketvoip.com                 RocketVoIP service
www.my800online.com                Personal 800 service
www.valucomonline.com              High-end Indian consumers
www.valumaxonline.com              Indian market
www.card2asia.com                  Indian market
www.supertel.com                   Iranian market
www.metrotelcom.net                Iranian market
www.wqnwireless.com                Prepaid wireless plans
www.rocketmobile.net               International calling for mobile phone users

      The Websites have been designed around industry standard  architectures to
reduce  downtime  in the  event of  outages  or  catastrophic  occurrences.  The
Websites  operations  staff will consist of systems  administrators  who manage,
monitor and operate the Websites. The continued  uninterrupted  operation of the
Websites is essential to the  acquired  business,  and it will be the job of the
site  operations  staff  to  ensure,  to  the  greatest  extent  possible,   the
reliability  of the  Websites.  The network is built  around a  redundant,  high
availability  backbone. In order to achieve maximum redundancy,  the network has
several connections to the Internet.

Wholesale Services

      The  wholesale  services  that the Company will  conduct  using the Assets
consist of the following:

      Distribution of Telephony Products.  The Company will distribute telephony
services, which primarily consists of prepaid calling cards through a network of
over 90 private distributors.  The Company will sell the product or service to a
distributor  at a discount  who then  resells the product or service to a retail
outlet. Through this network the Company estimates it will sell products to over
10,000  retail  outlets of which more than 5,000  retail  outlets are located in
Southern  California  which will give the Company access to various large ethnic
communities  seeking to make international phone calls. A significant portion of
the  distribution  business  will consist of prepaid  calling cards used to call
from the United  States to Mexico.  Through  this  network the Company will also
distribute our products in the Dallas, Houston,  Chicago, New York City, Newark,
and Miami  markets.  The Company  plans to use this  network in 2005 to sell its
proprietary VoIP products.

                                     - 5 -
Platform Services.  The Company will sell the acquired  Internet-based and
other telephony services to resellers,  corporations,  and service providers who
then resell the service under their own brand name.  Many of these resellers are
smaller  companies which purchase  virtual calling cards from us and then resell
the products from their own web sites.

Services Platform and Network

      Access. Access to the newly acquired,  propriety VoIP Network and enhanced
services  platform is available  by several  methods.  Customers  can access the
network from anywhere in the world through their high speed Internet  connection
using a broadband phone (which the Company will supply to RocketVoIP  customers)
and the soft phone which is a  downloadable  software that enables  customers to
make  PC-to-Phone  calls.  Customers can also access the network from the United
States and Canada using toll-free and local access numbers.

      Enhanced Services Platform.  The Company acquired WQN's centrally managed,
enhanced  services  platform,   consisting  of  a  reliable  and  flexible  data
management,  monitoring  control and billing  systems  which  support all of its
products and services.  Key elements  include  customer  provisioning,  customer
access, fraud control,  network security,  call routing,  call monitoring,  call
reliability  and detailed  call  records.  The enhanced  services  platform is a
specialized  telephone switch, soft switch, and software. It is connected to the
Websites  and  databases  acquired  from WQN and to its network of outgoing  and
incoming  telephone lines and Internet  lines.  It sets up all customer  account
information  when services are purchased and immediately  activates the services
so it can be used at the time of  purchase.  Programmed  into the  platform is a
lowest cost routing matrix. This matrix  automatically routes each call over the
route  most   economical  to  the  Company.   This  means  it  will  select  the
international  carrier with the lowest rate or the Internet if the Company has a
gateway in the call destination country.

      Proprietary  Technology.  The Company acquired WQN's proprietary  customer
software that permits a customer to purchase retail telephony  services from the
acquired  Websites using a credit card and to have the services  delivered while
on the Websites for immediate use by the customer. Proprietary customer software
also allows  customers  access to our platform  using their high speed  Internet
connection to initiate and receive  calls,  and various  proprietary  credit and
fraud  management  applications  will aid the  Company  in  checking  credit and
limiting fraudulent transactions.

Item 3.02 Unregistered Sales of Equity Securities

      In connection with the closing of the  transaction,  the Company agreed to
issue WQN 500,000  shares of  restricted  common  stock  relating to  difference
between the amount of accounts receivable transferred in the transaction and the
accounts  payable.  The shares  issued  and  issuable  under the Asset  Purchase
Agreement and the Letter  Agreement  were made and will be made in reliance upon
an exemption from the registration  provisions of the Securities Act of 1933, as
amended  (the  "Securities  Act") set forth in  Section  4(2) and  Regulation  D
thereof,  relative to sales by an issuer not involving any public offering,  and
the rules and regulations thereunder.

                                     - 6 -
Item 7.01 Regulation FD Disclosure

      Exhibit  99.1  hereto  is being  furnished,  and shall not be deemed to be
"filed" with the SEC. The  information in Exhibit 99.1 shall not be incorporated
by reference into any filing of the Company with the SEC, whether made before or
after the date hereof,  regardless of any general incorporation language in such
filings.

Safe Harbor

      Statements  about  the  Company's   future   expectations  and  all  other
statements in this Current Report on Form 8-K, other than historical  facts, are
"forward-looking statements" within the meaning of Section 27A of the Securities
Act, Section 21E of the Securities Exchange Act of 1934, as amended, and as that
term is defined in the Private  Securities  Litigation  Reform Act of 1995.  The
Company  intends  that such  forward-looking  statements  be subject to the safe
harbors created thereby.

      The above information contains information relating to the Company that is
based on the beliefs of the Company and/or its management as well as assumptions
made by, and information  currently available to, the Company or its management.
When  used in this  document,  the  words  "anticipate,"  "estimate,"  "expect,"
"intend," "plans,"  "projects," and similar  expressions,  as they relate to the
Company or its management, are intended to identify forward-looking  statements.
Such statements  reflect the current view of the Company regarding future events
and are subject to certain risks,  uncertainties and assumptions,  including the
risks  and  uncertainties   noted.   Should  one  or  more  of  these  risks  or
uncertainties  materialize,   or  should  underlying  assumptions  prove  to  be
incorrect,  actual results may vary materially  from those  described  herein as
anticipated,  believed,  estimated,  expected,  intended or  projected.  In each
instance,  forward-looking  information  should  be  considered  in light of the
accompanying  meaningful cautionary statements herein.  Factors that could cause
results to differ  include,  but are not limited to,  successful  performance of
internal  plans,  the impact of  competitive  services  and  pricing and general
economic risks and uncertainties.

Item 9.01 Financial Statements and Exhibits.

      (c)   Exhibits.

      99.1  Press Release, dated October 11, 2005

      10.1  Letter Agreement, dated October 5, 2005.

                                     - 7 -
SIGNATURES

      Pursuant to the  requirements of the Securities  Exchange Act of 1934, the
registrant  has duly  caused  this  report  to be  signed  on its  behalf by the
undersigned hereunto duly authorized.

Date:    October 11, 2005              VOIP, INC.
                                       (Registrant)

                                       By: /s/  Steven Ivester
                                           -------------------------------------
                                           Steven Ivester
                                           President and Chief Executive Officer

                                     - 8 -