Hello Rehan,
In old PSTN networks we had Class-5 switches which had both signaling and data network connectivity.
And the intelligency of handling the call was in Class-5, with network convergence and in-order to support more modular network, the soft-switch was intrduced, were intelligency of handling call was left on a computer and this computer will interface with Class-5 switch which will will be dummy and will process the request made by the soft-switch.
The interface between the soft-switch and class-5 dummy box was MGCP or Megaco.
Hope this helps……………
–
Hari