The Great Debate: SIP Trunking vs. VoIP
If you’re a Communications Provider (CP) or an IT Provider, you will undoubtedly will be faced with a decision at some point on what to sell as your key voice communications strategy. By working closely with our partners, this is something I get asked all the time.
Should I be selling Session Initiation Protocol (SIP) or a Hosted solution using Voice over Internet Protocol (VoIP)? And what exactly are the advantages of SIP over VoIP?
So many questions, so little time, as the 2025 PSTN and ISDN withdrawal draws closer, bringing with it plenty of new opportunities. So my advice is to sell both. Be prepared. Be a provider who can support all of your customers’ needs, and trust me, they will vary.
By answering your key questions, I hope I’m able to help you make an informed decision to help you and your customers prepare for the future.
What is the difference between VoIP and SIP?
Firstly, let’s talk lingo. Often, we talk about VoIP and SIP as though they’re two totally different things but technically, they’re not too dissimilar.
When your customers ask about VoIP they are most likely asking for hosted seats, whereas when they ask about SIP, they usually mean SIP Trunking, as a direct replacement for ISDN. Hosted Seats use SIP signalling to initiate the session to send calls to an Internet Protocol (IP) provider. So, essentially, they do the same thing.
It all boils down to the equipment making the call and your customers’ needs and wants. Customers need to move to IP, but what do they want to buy?
A VoIP solution, as we’ve already mentioned is generally a hosted seat. Hosted seats are often sold in package deals, bundled with calls usage, which make them easy to buy and sell. These solutions can be extremely flexible and scalable, offering single or multiple user licenses, shiny new IP handsets and mobile or desktop softphone clients. IP handsets are plugged into a broadband router and/or Power Over Ethernet (POE) switches to provide a single line replacement to the PSTN line over some form or broadband connection.
Now, SIP, or as I prefer to call it SIP Trunking, is generally sold exclusively to business customers. When SIP was first launched it provided a ‘like for like’ ISDN replacement. Business customers would have an onsite system, known as a Private Branch Exchange (PBX), which would be serviced by ISDN channels, usually between 2 and 30. By using SIP Trunking, these businesses were able to simply replace their ISDN channels with SIP channels, retaining their existing PBX.
That’s the key difference between the two products: If your customer wants to keep their existing on premise PBX, they need to use SIP. If your customer wants to replace their PBX, they need VoIP.
What should you sell?
Ok, so now you know your customers’ requirements, but what about your needs? Your business exists to thrive and make a profit, so which solution is likely to be the most profitable and efficient for you?
This is where I have to try not to be biased. As the SIP Product Manager here at Digital Wholesale Solutions, and an ex PBX engineering scheduler, I’ve lived and breathed these products for many years and have an affection for good old fashioned onsite “Tin”. If, like me, you are familiar with a PBX, you may even maintain them and sell them, then you will undoubtedly prefer the SIP Trunking route. It is just as profitable as fully hosted systems, when you bundle in new PBX equipment and maintenance, not to mention connectivity.
As an experienced CP, the reason to sell SIP will already be clear at this point, but for those that are new to the solution, I’ll explain. There are many customers out there who prefer on premise PBX equipment. In fact, in a recent survey by The SIP School, over 50% of companies still used a PBX, so the opportunity should not be underestimated. It is well worth taking SIP as a product, but, if you’re not a PBX savvy CP, make sure you know one. Alternatively, you can provide something to bypass the PBX, such as an ISDN to SIP Converter. If you’re interested in learning more about the ISDN to SIP Converters keep your eyes peeled as we will be publishing more soon.
Now onto VoIP. Despite being a SIP Trunking and PBX champion I have to admit, Hosted Voice, VoIP, Cloud Telephony or whatever you want to call it, is the future of voice. An onsite PBX has a life span of around 10 years, depending on how desperately your customer intends to sweat their assets but ultimately, a decision will need to be made. Again, it comes down to your customers’ wants and needs, but who wouldn’t want new future ready IP handsets, an online management portal with call statistics and Cloud call recording, reporting and queuing, all accessed and managed by the customer themselves?
Here’s where VoIP becomes a much more attractive option than your traditional SIP Trunking and PBX. It can offer so much more at the same price, if not slightly more competitive than PBX options. Not to mention how extremely easy hosted seats are to maintain, provide, and support for new telecoms or IT providers looking to sell into this space.
Before I wrap up the debate, I have got to highlight the SIP products on the market, such as HV.Select SIP, that offer features that on premise PBX customers want, and need, even though they’re not ready to move to a fully hosted solution. Features including an online portal, Cloud call recording, reporting and more.
It’s no longer a case of “should I sell SIP or VoIP?” It’s a case of why on earth wouldn’t you sell them? VoIP is the future, and SIP is the stepping stone for those not ready make the leap just yet. If you’re not selling them both, you should be.
To learn more about our IP Communications solutions, including both SIP and VoIP, contact us today!