SIP trunking connects a phone system you already own to the public phone network over an internet or private connection, and you pay for call paths or usage. Hosted PBX means the provider runs the phone system in the cloud and you pay per user, with desk phones and apps connecting to it. If you have a PBX with years of life left and someone who manages it, SIP trunks usually cost less. If not, hosted is usually simpler, and simpler is often cheaper once you count the time.
The decision usually arrives with a trigger: the old phone lines are being retired, the PBX maintenance contract is up, or the office is moving. Here is how to think it through.
What each one actually is
SIP trunking
A PBX is the switch that runs an office phone system: extensions, transfers, voicemail, auto attendant. Traditionally it connected to the outside world through copper lines or a PRI, a digital circuit carrying 23 simultaneous calls on a T1. A SIP trunk does the same job over IP. Your PBX, whether a box in the server room or a virtual machine, registers to the carrier, and calls travel as data. You keep the phones, the features and the admin you already have.
Hosted PBX
With hosted phones, there is no PBX of your own. The provider runs it on its platform. Desk phones, desktop apps and mobile apps connect straight to it over the internet, and features such as call queues and voicemail-to-email are settings in a web portal. You pay a monthly amount per user, and the provider handles upgrades and maintenance.
Side by side
| SIP trunking | Hosted PBX | |
|---|---|---|
| Who owns the phone system | You | The provider |
| Pricing unit | Call paths (concurrent calls), sometimes plus usage | Per user per month, with cheaper tiers for lobby and shared phones |
| Up-front cost | Low if the PBX already exists | Phones, unless you reuse compatible ones |
| Maintenance and upgrades | Yours, or your PBX vendor's | The provider's |
| Remote and mobile working | Depends on your PBX | Built in, through apps |
| Integration with old kit | Strong; keeps paging, door entry, analog devices on the PBX | Possible with adapters; check each device |
| Best fit | Larger offices with a capable PBX and an IT team | Most small and mid-sized offices, and anyone replacing an old PBX |
Both run over your internet connection, so both depend on it. The voice and UCaaS page covers how we engineer the two together.
Sizing SIP trunks
SIP trunks are sized by concurrent calls, not by users. Forty staff do not make forty calls at once.
- Pull call records from your PBX or phone bill and find the busiest hour of the busiest days, including month-end, seasonal peaks and any campaigns.
- Count peak simultaneous calls, inbound and outbound together.
- Add headroom for growth and unusual days. Some carriers also offer burst capacity above your paths.
- Check bandwidth. A common G.711 call uses roughly 90 to 100 kbps in each direction once packet overhead is included. A compressed codec such as G.729 uses much less. Even twenty G.711 calls need only about 2 Mbps each way, which any fiber circuit handles. The harder requirement is priority.
Voice cares about delay, jitter and packet loss far more than raw speed. Traffic prioritisation (QoS) on your network, and a circuit with a real upload, matter more than headline bandwidth. That is one reason dedicated internet access is popular under voice, and why anyone running phones over a cable line should look hard at the upload number.
Sizing hosted PBX
Hosted is sized by seats. Count everyone who needs a number or an extension, then separate the types:
- Full users who make and take calls all day.
- Light users who mostly need an extension and voicemail. Some providers offer a cheaper tier.
- Shared devices: lobby phones, conference rooms, a warehouse phone. These usually have a lower-cost licence.
- Virtual numbers and call flows: main line, auto attendant, fax, call queues.
A worked example
A hypothetical office with invented per-unit costs, used only to show the method. These are not market prices or FiberX quotes.
Suppose a 45-person office has a PBX bought four years ago, with an IT manager who looks after it. Call records show a peak of 12 simultaneous calls. Its PRI is being retired by the carrier.
Option A, SIP trunks. 12 peak calls plus headroom gives 16 paths. At a hypothetical $20 per path per month, that is $320 a month. Add the PBX maintenance contract, say a hypothetical $150 a month, for $470 a month, plus the IT manager's time.
Option B, hosted PBX. 40 full users and 5 shared phones. At a hypothetical $25 per user and $10 per shared phone, that is $1,050 a month, with nothing to maintain, mobile apps included, and new phones for anyone whose current handset is incompatible.
On these made-up figures, SIP trunks cost less while the PBX lasts. The question is what happens in two or three years when the PBX needs replacing, and how much of the IT manager's time the phone system eats. If the PBX were ten years old, or nobody in the building understood it, Option B would usually win outright. Run the same method with your real quotes and your real PBX age.
Keep the PBX or let it go: a quick test
Lean towards SIP trunks if most of these are true:
- The PBX is under a few years old and still supported by its manufacturer.
- Someone on staff, or a trusted vendor, manages it well.
- It connects to things that are hard to move: overhead paging, door entry, a call recording system, a contact centre.
- You have more than roughly a few dozen users, where per-user pricing starts to add up.
Lean towards hosted if most of these are true:
- The PBX is old, out of support, or understood by one person who is about to retire.
- Staff work from home or on the road and need the office number on their mobiles.
- You have several small offices that should behave as one phone system.
- Nobody wants to own the phone system at all.
Why the old lines are going away
Many carriers are retiring copper phone lines and PRI circuits in favour of IP-based services, and some have raised prices on the copper that remains. That is often what forces the decision. It also catches devices that nobody thought of as phones: fax machines, alarm panels, elevator emergency phones, postage meters and card terminals that still dial out over an analog line. Before you cancel any copper, list every device plugged into it. Some can move to an adapter on the new service, some need a replacement that uses cellular or IP, and a few, such as certain alarm and elevator lines, are governed by their own codes and should be checked with the vendor or the building.
The middle path
There are options between the two:
- A PBX you control, hosted in a data centre or the cloud, connected by SIP trunks. You keep ownership of the configuration without keeping hardware in the office.
- Microsoft Teams as the phone system, with SIP trunks connected through direct routing. If your staff already live in Teams, read Teams direct routing explained.
- A phased move: SIP trunks now to replace the retiring lines, hosted PBX when the PBX reaches end of life.
Cutover without a quiet phone
Whichever you choose, the move itself should be boring. Build and test the new setup on temporary numbers first, so that on cutover day the only change is where the numbers point. Schedule the port for a mid-week morning, keep the old lines connected until calls are confirmed arriving on the new system, and have someone ring every main number, direct line and fax from a mobile. Check that outbound caller ID shows your number, and that voicemail, the auto attendant and any after-hours routing behave as planned. An hour of testing on the day saves a week of customers saying they could not get through.
What both options have in common
- Your numbers can move. In most cases you keep them either way. See porting business phone numbers.
- 911 rules apply. Direct 911 dialling, notification and dispatchable location apply to your system whichever way you go. See E911 rules for business phones.
- Power and internet outages matter. Phones that run on the network need power at the switch, and calls need a working circuit. Plan a backup path or failover to mobiles.
Questions to ask your provider
- For SIP: how are paths priced, is there burst capacity, and are calls metered or unlimited?
- Which PBX models and software versions are certified or tested with your trunks?
- For hosted: what is included in each user tier, and what costs extra, such as call recording or queues?
- Can I reuse my existing desk phones?
- What happens to inbound calls if my office internet goes down?
- How do you handle 911 location for desk phones and for remote users?
- Who manages the number port, and how long will it take?
Getting both priced for your office
We quote SIP trunks and hosted PBX from several providers side by side, along with the circuit underneath, and we will tell you if keeping your current setup is the better call. The provider pays us, so there is no markup. The quote is free with no obligation and you usually hear back the same day. Send us your call volumes and headcount, call 478-758-8091 or text (347) 870-0965.
