Global channel - Everyone on server will hear you (Removed in DayZ version 1.7.1)
Side channel - Everyone in your side will hear you (Removed in DayZ version 1.7.1)
Command channel - Only group commanders can hear you (Removed in DayZ version 1.7.1)
Group channel - In lobby everyone can hear you, in-game people in your group can hear you (= no one in DayZ)
Vehicle channel - Only people who are in same vehicle with you will hear you
Direct communication - Those who are near you hear voice coming from your character.
Character's mouth moves when you talk. Voice fades over distance and cuts off at 80 meters. Text range is 20 meters (1.60), 40 meters with beta (since build 93586), and longer range is requested.
Note: Using voice chat in any channel will also broadcast it from your character (as if you were using direct communication).
Removal of global channels
Rocket's plan has always been to remove the global channels, leaving only the direct communication channel so you can talk to nearby players. Due to direct communication channel being bugged before, the global channels were left on. Direct communication channel was fixed in ArmA 2 beta build 93040. Ability to remove the channels has been added in beta build 93398.
Since DayZ version 1.7.1, ArmA 2 beta patch is mandatory, so the global channels are disabled for everyone. It is confirmed by rocket, that additional communication methods will be introduced in 1.8 forward. This most likely means radios or cell phones.
Voice quality
The quality of in-game voice chat depends on server, as server owner can change the vonCodecQuality setting in the config. The default quality is quite low 3, and maximum is 10.