What Is SIP Trunking? The Ultimate Guide

“What is SIP Trunking?” is a question we get asked a lot by our customers, new starters, and people we attempt to explain our job to in bars. To make everyone’s life easier we created this, the ultimate guide.

When it comes to the communications industry, change is continuous and never-ending. It wasn’t too long ago that PRI ISDN was the new kid on the block making our lives easier and more cost-effective. Now, with the expansion and increased usage of broadband and cloud-based communications, a whole world of possibility has opened up for worldwide telecommunications and Internet-based telephony.

At Voxbone, we’ve been providing SIP trunks to corporates for 14 years, and even after all that time, there are still plenty of questions that we get from our customers about what SIP trunking is and why they need it.

This guide is designed to provide a simple and straightforward reference for everything ‘SIP trunks’ including:

Think of this as “SIP Trunks: For Dummies”, you shouldn’t need any prior knowledge of the telecoms industry or be an IT expert to get an idea of what all this means for you or a business you might own.

A Bit of SIP Trunking History

To get an idea of what SIP trunks are and how they relate to businesses, it’s important to take a look at what came before and how corporate business needs are evolving.

The Plain-Old-Telephone-Service (POTS) – 1876

Do I Need Private Interconnections

Public telephones have been available since the late 19th century and for over 100 years this so-called plain-old-telephone-service (POTS) was the standard offering from most telecoms carriers until the Integrated Services Digital Network (ISDN) was introduced in 1988.

Think about that for a moment. In 1988, most companies were effectively running their telecoms exactly as they would have a century earlier!

POTS is still the most widely used telephone connection you can get through your phone line. Basically, an electrical signal is sent down copper wires from the phone on your desk to the public switched telephone network (PSTN), which is simply the global aggregate of all these interconnected copper telephone systems. The signal is carried via exchanges across cities, countries, continents and oceans – hopping from one provider’s network to the next.

The Integrated Services Digital Network (ISDN) – 1988

The Integrated Services Digital Network (ISDN) is a set of communication standards (essentially a set of rules) that control the data going across the same copper PSTN line. So where you could previously only get voice, you could now get the digital transmission of voice, video, data, and other network services.

ISDN comes in two forms: the basic rate interface (BRI) and the primary rate interface (PRI), the difference essentially being that PRI can transfer more data, making it easier to transfer things like HD audio and video and more suitable for enterprises.

Session Initiation Protocol (SIP) – 2000

Like ISDN, Session Initiation Protocol is a set of communication standards that allow (for the most part) the setup and termination of voice or video calls.

The difference is that, instead of calls being carried across potentially thousands of miles of copper wiring to get to their destination, SIP allows voice traffic to be carried over data networks, including the internet.

Because allows for travel over the internet, SIP is considered a type of Voice over Internet Protocol (VoIP) which is an overarching term for the technology included in all IP based telephony.

Unlike so-called Over-the-Top (OTT) VoIP, services such as WhatsApp, that require both calling parties to have an active data connection and carry calls entirely over data networks, the beauty of SIP is that it can be used to send calls to and from the PSTN. Using a special type of media gateway, carriers can convert signals from fiber optic to copper as they travel between SIP networks and conventional telephone networks.

This is the reason why it’s possible to add a virtual phone number to your SIP lines, then make and receive calls as if you were using any other legacy line from a traditional carrier.

So What is SIP Trunking?

Nemertes The Evolution of SIP Trunking

‘Trunking’ is a term that has been used since the introduction of POTS in the late 19th century and describes the process of allowing multiple callers access to the same telephone service by sharing a line that can handle multiple calls instead of providing an individual line for each call.

Today the terms trunk and trunking are used in quite confusing ways. Even we’ll admit the telecoms industry isn’t amazing when it comes to clarity.

In one way it is the method described above, where lots of calls are able to travel through one network connection. In the case of SIP, this involves the transfer of IP data.

On the other hand, trunking is also used to describe the whole process of transferring a call between its origin and destination using SIP. In other words, voice data being transferred through your company’s organization via your PBX, then being sent to your SIP providers’ network via a “SIP trunk” and eventually being carried to its destination (another phone or computer). That can be across the old fashioned PSTN or in the case of a VoIP call, the internet.

What are SIP Trunk Channels?

How Many Channels are in a SIP Trunk

You’ll see a lot of telecoms companies talking about the cost of ‘channels’ in their SIP trunks. Usually, these are sold in batches.

Even though they’re called ‘channels’ what we’re actually talking about is the bandwidth needed to transfer a call through your SIP connection.

It’s easier to think of channels as lanes on your highway, with data as the cars on that highway. If you’re connecting one town to another with the highway you might only need one or two lanes.

But if lots of towns are connected to city, you’re in danger of getting traffic jams unless you have highways in place. Because only one car can use a single lane at any point in time (legally anyway!), you need to ensure you have the right number of lanes for the amount of traffic you expect. Unlike road building, it’s possible to dynamically and automatically scale this capacity.

Depending on your use case, your traffic profile and the number of channels you need can differ vastly. A retailer operating a contact center might expect big spikes in call traffic around Christmas, while a conferencing provider can expect most of their traffic to fall during the working week. Monday morning meetings, anyone?

How Many Channels Does a SIP Trunk Have?

phone numbers

Because a SIP trunk is simply a group of connections on one network, the number of channels you can have is unlimited.

If you have ten customers the most concurrent calls you might expect is ten, so you’ll need at least ten channels. A million calls and you’ll need a million channels. And so on.

But this is where things get clever. Because it’s highly unlikely your entire customer base will ever ring need to talk to you at the same time. If they do, it’s either a really really good thing or something truly, deeply terrible. We’ll leave it to you to decide.

So clever statisticians came up with models to let you predict your peak channel requirements. And what do you know, if you have 100 employees who all use the telephone, you probably need far fewer than 100 channels to keep them happy.

Needless to say at this point, things are getting complicated. That’s why capacity planning and traffic forecasting are sciences in themselves. The good thing is that you don’t need to do this, unless you want to. While capacity planning is a good way to improve operational efficiency when you’re dealing with very high call volumes, it’s much simpler to just pay for what you use. But more on that later.

PRI vs SIP

PRI vs. SIP Trunks

So now you know what SIP trunks are, you’ll need to consider whether you’re ready to jump in with both feet, if you need a more gradual migration strategy or if you wish to stick with PRI ISDN.

The PRI Benefit – Infrastructure You Already Have

The main benefit of PRI ISDN is that if you already have it set up, it’s low cost in the short term because you won’t need to make any major infrastructure changes. Digital Transformation is a big investment, but it’s something you’ll need to do sooner or later because eventually you won’t be able to use the ISDN in most advanced economies.

Benefits of SIP Trunking

Local Calls

One major benefit is the ability to make local calls in places where you don’t have a physical presence.

If you choose a provider with a global backbone, calls can be collected from the ISDN in any location their network is interconnected, then delivered to your company’s network wherever that might be. Value-added features such as local call presentation and full access to national numbering plans mean that SIP calls can be indistinguishable from those to and from a traditional local phone line.

Unified Communications

The concept of unified communications is becoming more popular each year as businesses turn to omnichannel marketing strategies in order to improve their customer experience. Part of those strategies is often apps with integrated comms or chat features.

Unlike PRI ISDN, which operates as an independent system, SIP trunk connections can be integrated into any VoIP-enabled application, including CRM and ERM software, allowing for more effective and measurable conversations with customers.

Flexibility

The ease and speed to which you can scale your call capacity with SIP trunks compared to PRI is night and day.

When it comes to PRI connections, because of the bandwidth limits that physical lines have, it’s only possible to have around 23 channels per physical line. This means that if you only needed a few more channels, you’d need to spend money on channels you might never use.

For example, if at peak times you’re getting 25 calls, you’re going to need around 30 channels (a few more added to make sure you don’t use up all your bandwidth). But if you only have one line, you’d need to add another line, pay for the installation and have 16 channels that you might never use. Which isn’t really cost-effective.

With SIP Trunks, channels are often sold in smaller batches and scaling requires no on-site hardware installation so the upgrade is instant. Obviously, downgrading is just as straight forward and can save a small fortune in the long run compared to PRI.

If you’re looking to just make a couple of calls and you aren’t interested in anything more than that, it might be that SIP trunking isn’t right for you. But if you’re looking to expand your business or you have peak periods, save money by using SIP trunks.

Cost Savings

We recently partnered with Nemertes Research to find out what kind of organizations are using SIP trunks and what benefits they’re getting from it.

The results showed that 57% are either currently using or are planning to use SIP trunking, with 41% saying they want to use SIP Trunking to save costs.

It’s pretty clear why when 44.9% of those that were already using SIP trunking seeing a reduced Wide Area Network spend and large enterprises from that group seeing an average spend saving of 18%.

SIP Trunk Security: How Foolproof are Your Comms?

SIP Trunk Security

When it comes to business, there’s nothing more dangerous than unsecured data. And in this day and age, it can mean the difference between keeping your business or losing it. So if you’re making sales calls, handling personal information of customers including payment details, hosting important meetings or sending sensitive documents, you want to make sure your calls are safe and secure.

So if SIP trunks are the future of business telecoms, what can we do with them to keep our data safe?

There are three main layers of security required for a SIP call.

  • SRTP (Secure Real-time Transport Protocol) – To protect and encrypt the call media
  • TLS (Transport Layer Security) – To protect and encrypt the call event and metadata
  • VPN (Virtual Private Network) – To protect and encrypt the route through which the call travels over any public networks

The Public Internet vs a Private Connection

Let’s go back to the highway analogy with the car containing your data, and the highway/ roads as a network.

If you want to make sure the contents of the car are safe you can do one of two things. Get better locks for your car or drive on your own private roads

For even better security, it is possible to ensure your call never needs to traverse over a public network such as the internet by creating a dedicated logical or physical interconnection with your SIP trunking partner.

Types of Connection

Public Internet Connection

Connecting to a SIP trunk provider network via the network is as easy as setting up a facebook account. It can take an hour or so, but is usually cheap, simple to do and can have you up and running in no time.

The downside here is that connecting via the internet can create problems at peak times and create some latency on a call. Not a huge problem if you’re only having a few calls going to and from your business, but if you’re handling hundreds or even thousands of calls, you’re going to want a dedicated line.

Dedicated Lines/Interconnection

A dedicated line or interconnection is a physical connection between your business and the SIP providers network. It’s typically leased by the SIP provider, at a cost to you, and is often a literal fiber connection of varying lengths.

This allows for a private connection to any other office or phone systems you may have and will protect your voice data when coming in from and going out to the public internet. The reason this is protected is the same reason given above. Your voice data and incoming voice traffic are gated, and so must go through a firewall to reach its destination.

Having a physical connection also means that you will see minimum downtime which will ultimately save costs and, if you have a large amount of traffic, reduce any problems with latency.

SIP Trunk Pricing: How it Works

SIP Trunk Pricing

So if you’ve decided to go down the SIP trunking route, your first question, as with any purchase is “how much does it cost?”.

Each SIP trunk provider will have a different pricing model, but typically, you don’t actually pay for the SIP trunk, you pay for the data usage for the calls. Basically, it often doesn’t matter how many channels you use or how many sip trunks they are split into, what matters is the amount of data (voice, video or otherwise) you’re transferring over the network. That usage is typically what you pay for, rather than the number of channels you have the potential of using.

What this means is that it is possible, and in fact, common, to get free SIP trunks from a SIP trunk provider, but the more people who you call or who call you, the more you’re going to pay for your SIP trunk service in terms of the number of channels you need, the cost per minute of making calls or receiving toll-free calls and the amount of bandwidth you need to handle your call traffic.

How To Pick Your SIP Trunk Provider

How To Pick a SIP Trunk Provider

In terms of driving great CX for your customers, nothing is more important than communications.

Picking a partner is crucial to this. To make the right choice, your SIP trunk provider should possess the right capabilities, especially if you wish to serve a global customer base. Here are a few to keep in mind:

The breadth and depth of their SIP connectivity

In other words, how many markets or regions are accessible and do you have access to local numbers in the places that you are going to want to reach out to your customers?

Which and how many countries are supported

This includes domestic outbound calling, as well as their ability to reach SMS-capable mobile numbers. Even for those who can support your international customers, you need to ensure they can all deliver the same CX with regard to factors such as call quality, latency, etc.

Compliant wherever your customers are.

Licensing and regulatory requirements vary from country to country, and GDPR is just one example of essential governance for cloud communications. Other examples will be coming, and as you scale your business communications, you’ll need a partner that stays current with compliance.

A redundant infrastructure

Simply co-locating across two or three data centers won’t be enough for a global customer base, and a better indicator is points of presence (PoPs) –how many are available for supporting large scale contact centers, and where they are, relative to your customers. Not only is this needed to optimize service uptime, but there are compliance requirements around reliability to ensure ongoing access to numbers and service across global regions. On a more practical level, service reliability is critical for resiliency and disaster recovery.

Finally, you need to consider the ease of managing services as you scale

This covers a range of things such as basic service setup, working with APIs to provision new features, porting numbers, and address verification for routing calls. As your operations scale, the key here will be having the ability to control your communications stack down to each country level to ensure a consistent end-to-end CX regardless of where the customer is located.

Voxbone as a SIP Trunk Provider

Voxbone continues to superpower the largest communications providers and enterprises

Like we said at the beginning, we’ve been a SIP trunk provider for 14 years and we hope you got a little bit of insight into what SIP trunks are and how they might fit into your business communications.

If you want to look at Voxbone as a potential SIP trunk provider, some of the benefits we bring our clients include:

  • Access 10,000+ municipalities across 65+ markets with a single SIP connection.
  • Two-way voice and messaging on demand that you can integrate into any communications platform.
  • Fully compliant SIP lines into every market for long-term availability, stability and quality.
  • Secure connectivity close to the source, with 20 access points into our global carrier-grade voice network.

Want to set up a phone number and voice capability in China? Brazil? India? No need to worry about dealing with multiple suppliers. With Voxbone there are no language barriers, no contractual barriers, no time barriers. Just the right sort of business speak.

Contact us to find out more