SIP Trunks Explained: How They Work and What They Cost
What SIP trunks are, how they replace old phone lines, what they cost, and how they cut your call and line-rental bills.
If you have ever looked at a phone bill and wondered what you are actually paying for, SIP trunks are worth understanding. They are the technology quietly replacing the old phone lines in most Australian businesses, and getting them right can save you a real amount of money each month. This guide explains, in plain English, how SIP trunks work, what they cost, and how to tell whether they are the right fit for your business.
What is a SIP trunk?
SIP stands for Session Initiation Protocol. A SIP trunk is simply a way of carrying phone calls over your internet connection instead of over traditional copper phone lines like ISDN or PSTN. Think of it as a digital pipe between your phone system and the outside world. Where an old ISDN service gave you a fixed number of physical channels, a SIP trunk delivers those calls as data, so you can scale the number of simultaneous calls up or down without an engineer rewiring anything.
This matters more than ever right now. Australia's copper PSTN network is being retired premises by premises as the NBN becomes available in each area, so the old lines many businesses still rely on are ending. SIP trunks are one of the main ways businesses are moving off that ageing infrastructure.
How SIP trunks work
A SIP trunk connects three things: your phone numbers, your phone system, and the public phone network. When someone calls you, the SIP trunk routes that call over the internet to your phone system, which rings the right extension. When you dial out, it works in reverse. Because it is all data, you are not tied to a single building. You can keep your existing numbers, route calls across multiple sites, and add or remove call capacity as your team changes.
SIP trunks work alongside a phone system rather than replacing it. At SIP Connect they connect with platforms like 3CX and Cisco IP PBX, and they sit comfortably with hosted setups too. If you would rather not run a phone system at all, a fully hosted PBX or Microsoft Teams Direct Routing can cover the same ground without an on-premise box to manage.
What do SIP trunks cost?
Honest answer: it depends on how you call. Pricing usually comes down to two things, the number of simultaneous calls (channels) you need, and how your call charges are structured. A small office that rarely has more than a few calls at once pays very differently from a busy contact centre. That is the upside of SIP, you only buy the capacity you actually use, rather than paying for a fixed bundle of ISDN channels whether you use them or not.
For most businesses, the savings come from two places. First, the line rental on old copper services disappears. Second, call rates over SIP are typically lower, and inter-office calls between your own sites are often free. Our bill reviews have identified savings of up to 65 percent.
What you need before you switch
SIP trunks ride on your internet, so a steady connection matters. Voice does not use much bandwidth, but it does need consistent quality so calls stay clear. If your current connection is patchy, it is worth looking at business internet options, whether that is business NBN, gigabit fibre or 5G fixed wireless, before or alongside the move. A good provider will check this for you rather than leave you to guess.
You will also want to keep your existing phone numbers, including any 1300 or 1800 numbers, which can be ported across so customers never notice the change. Done well, the cutover is quick and your team carries on as normal.
Is SIP right for every business?
Being honest, SIP is an excellent fit for the large majority of Australian businesses, but it is not magic. If your internet is genuinely unstable and cannot be improved, voice quality will suffer, so the connection has to be sorted first. And the cheapest self-serve SIP product online is not always the best value once you factor in setup, number porting and support when something goes wrong. That is the gap we aim to fill: local people who set it up properly and stay on the line afterwards.
Frequently asked questions
Will I keep my existing phone numbers?
Yes. In almost all cases your existing numbers, including 1300 and 1800 numbers, can be ported to a SIP trunk so nothing changes for your customers.
Do I need to replace my phone system to use SIP trunks?
Not necessarily. SIP trunks work with many existing systems, including 3CX and Cisco. If your current system is at the end of its life, it can be a good moment to move to a hosted PBX or Microsoft Teams instead, and we can advise on what suits you.
How quickly can SIP trunks be set up?
Once your numbers and connection are sorted, the switch is fast. We have installed full phone systems in days, not weeks, and a straightforward SIP cutover is typically quick and low-fuss.
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