Despite the fact that everyone nowadays carries a personal cellphone, business phones aren’t going away — but they are changing. Like many services, business telephony is moving to the cloud, thanks to technology like SIP trunking, which offers businesses advantages such as quick provisioning, low costs, and no equipment to procure or maintain.
It’s a big change from the way business telephony used to run. In the good old days before the internet was everywhere — say, 1990 — telephone calls ran over copper wires from customer premises to analog switches in carrier central offices. If you ran a business and wanted to give your employees individual phones, you installed equipment called a private branch exchange (PBX). The phone company would run a line from their network to a punchdown block in a wiring closet at your location, and your technical team would run internal wiring to employees’ cubicles and drop fancy phones on top of their desks. Together the phones and the PBX supported advanced features like call hold and call forwarding. At least they were advanced compared to what people could do with their home phones.
The World Wide Web was invented in 1993, and within a few years it was clear that the internet was going to be a global network that could connect everyone and everything — including phones. Voice and video traffic could cross the network by using networking protocols like Internet Protocol (IP). The advent of voice over IP (VoIP) led to the development of the IP PBX, a hardware box (either a purpose-built device or a general-purpose server running software such as Asterisk, the first open source IP PBX) that translated between circuit-switching telephone calls and packet-switching networks.
What is SIP trunking?
Let’s start with the first part of this phrase: SIP.
For network devices to communicate, they have to agree on common data and transmission formats, or protocols. The Session Initiation Protocol (SIP) was developed to provide a common way for devices and applications to initiate, maintain, and terminate real-time multimedia sessions involving voice and video. Simply put, SIP enables communication over the internet. It sets up, modifies, and terminates communication sessions.
The second part of the phrase, trunking, refers to the consolidation of multiple communication channels into a single, logical connection. Historically, a trunk line is the cable that brings phone service to a building. Today, trunks are virtual, running over the same network as a company’s data.
SIP trunking is a modern, cost-effective, and flexible way to handle business communications. It's a key component of many VoIP (Voice over Internet Protocol) systems.
6 benefits of SIP trunking
SIP trunking delivers a range of business benefits. Here are just a few to keep in mind as you explore this solution for your company.
Flexibility
With SIP trunking, businesses can add numbers easily whenever they need them, and each number can make and receive unlimited local and long-distance calls. Compared to traditional Primary Rate Interface (PRI) solutions, which use 23 voice channels, SIP trunking can use just one channel. As a result, you will only pay for what you use, and can increase or decrease your bandwidth easily with SIP.
Scalability
You can add as many numbers as you need and drop them when the need goes away. Businesses that need to scale to meet seasonal demand or that plan to scale their infrastructure as they grow can benefit from not having to invest in new hardware or software.
Mobility
Employees can make or receive calls from wherever they work, whether in-office, remotely, or a hybrid of the two. An SIP endpoint can move to almost any device, so employees can be reached in the office or working from a coffee shop.
Manageability
No more waiting on hold to reach a representative. SIP trunking and VoIP phones typically offer self-service options and on-site support, with instructions to help adjust call routing, change extensions, or add new lines. Ultimately, managing SIP trunks is much easier and less time-consuming.
Cost savings
SIP trunking is cost-effective, especially with Plivo. Businesses pay a small monthly fee and less than a penny a minute (in the US; pricing varies by country) for outgoing voice calls. That’s less than the cost of a call on a number leased from a phone company.
SIP trunking offers another cost advantage—no hardware is necessary. Any network device with a microphone and speakers can act as a softphone. That saves companies the cost of procuring and maintaining telephones, though if you prefer to have a separate device for phone calls, you can buy SIP handsets.
Virtual local presence
You can use SIP phone numbers with any area code and exchange that your provider offers. You can appear to be a local caller to your customers, boosting trust and increasing familiarity with your brand. Even if you’re far away, it’s possible to connect through a virtual local presence.
SIP advantages go beyond the ones on this list. You can create SIP endpoints that let you invoke custom functionality when you make or receive calls. Any Plivo application can implement the logic needed to control a registered SIP phone. Read our documentation to get a feel for how that works.
Drawbacks to SIP trunking
Ready to jump into SIP trunking with both feet? Just be aware of a couple of potential drawbacks.
With SIP trunking, if your network goes down, so does your phone system. You can use an old-school PRI (Primary Rate Interface) as a backup option, but weigh the costs and benefits. If your network is 99.9% stable during business hours, you might not want to pay for phone lines you never use.
Another disadvantage is that SIP traffic is network traffic, and if your network is already congested, you may worsen your problems. However, bandwidth is cheap nowadays, so you can solve that problem by simply increasing your bandwidth at an affordable rate.
Use cases: SIP trunking in different industries
SIP trunking is used by financial institutions, healthcare providers, retailers and other businesses to facilitate communication and stick to a budget. Here’s a few use cases to demonstrate how real-world businesses utilize SIP trunking.
Retail
Retailers use SIP trunking to support omnichannel customer experiences. By enabling seamless communication across different channels, retailers can improve customer service and boost customer satisfaction through improved call handling, efficient order processing, and streamlined support interactions. Likewise, features like call routing, voicemail-to-email, and CRM integration contribute to increased productivity and sales.
Healthcare
SIP trunking allows healthcare providers to offer better patient care. Medical staff can communicate seamlessly to share medical records, schedule appointments, and host remote consultations. Healthcare organizations can consolidate voice and data services to reduce expenses, directing more resources toward patient outcomes. Plus, features like unified communications empower medical professionals to collaborate effectively, improving overall productivity.
Financial institutions
Banks, lenders, and other financial institutions can use SIP trunking to deliver secure, reliable communication. Financial firms can achieve substantial cost savings by eliminating the need for multiple phone lines and associated hardware. Furthermore, unified communication tools enhance team collaboration, accelerate decision-making, and improve overall efficiency.
Get Plivo’s solution for SIP trunking
Zentrunk, Plivo’s SIP trunking service, is a popular option for businesses of all sizes. Zentrunk ’s cloud-based, so acquiring or managing any hardware on-prem is unnecessary. Zentrunk offers guaranteed call quality, high uptime, and unlimited concurrent calls. You can purchase and instantly provision SIP numbers for inbound calls in dozens of countries on every continent (except Antarctica), and make calls from your SIP numbers to virtually everywhere on Earth.
Ready to try Zentrunk? Dive into our Quickstart guide, sign up for a Plivo account, and start connecting with the world.
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