What Is a SIP Trunk? A Plain-English Guide for Australian Businesses

If you've been researching business phone systems in Australia, you've likely come across the term "SIP Trunk." It sounds technical, but the concept is quite simple. A SIP trunk is the modern, digital equivalent of a traditional phone line. It allows you to make and receive calls over the internet, replacing the need for outdated and expensive ISDN or PSTN lines. This guide explains everything you need to know in plain English.

From ISDN to SIP: A Quick History

For decades, businesses relied on ISDN (Integrated Services Digital Network) to connect their on-premise PBX (phone system hardware) to the public telephone network. ISDN provided multiple digital channels, allowing businesses to make and receive several calls at once. However, with the rollout of the NBN, these old copper-based networks are being decommissioned. SIP is the technology that replaces them.

What is SIP and How Does it Work?

SIP stands for Session Initiation Protocol. It's a set of rules that allows for the creation, modification, and termination of real-time communication sessions—like a phone call—over an internet connection. A "SIP Trunk" is the virtual link that connects your business's phone system (your IP PBX) to the wider telephone network via your internet connection.

Think of it like this: your IP PBX is your internal phone network, managing all your extensions and features. The SIP trunk is the multi-lane highway that connects your internal network to the outside world, allowing you to make and receive external calls.

What are "Channels"?

A key concept in SIP trunking is the "channel." One channel is equivalent to one concurrent call. If you have 10 channels, your business can make or receive up to 10 calls at the same time. This is a major advantage over traditional lines, where you were locked into a fixed number of lines (e.g., 10, 20, or 30 with ISDN). With SIP, you can choose the exact number of channels you need and easily add or remove them as your business requirements change.

The Benefits of SIP Trunking

For Australian businesses with an existing on-premise IP PBX, switching to SIP trunks offers several significant advantages:

• Cost Savings: SIP trunks are significantly cheaper than ISDN line rental. You can save up to 70% on your monthly phone bill by eliminating fixed line rental costs. Call rates are also generally much lower.
• Flexibility: Easily scale your channels up or down as needed. If you have a busy period, you can add more channels temporarily and then remove them afterwards, only paying for what you use.
• Business Continuity: If your office experiences an outage (e.g., power or internet failure), your SIP provider can automatically re-route all incoming calls to alternative numbers, such as mobile phones, ensuring you never miss a customer call.
• Unified Communications: SIP is the foundation for Unified Communications (UC), allowing you to integrate voice, video, and messaging into a single platform.
• Keep Your Numbers: You can port all your existing business phone numbers to your SIP trunking service, ensuring a seamless transition for your customers.

Who is SIP Trunking For?

SIP trunking is the ideal solution for any Australian business that has already invested in an on-premise IP PBX system (from brands like 3CX, Avaya, Cisco, or Mitel) and wants to reduce costs and increase flexibility by moving away from traditional ISDN lines. If you don't have an existing IP PBX, a fully hosted Cloud PBX solution is likely a better fit, as it provides all the benefits of VoIP without needing any on-site hardware.