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SIP Trunking:  What You Need To Know

what-is-sip-trunking-and-how-does-it-work

Technological tools and applications have been developed over the past several years to streamline and optimize business processes and functions. A key function that has been significantly transformed as a result of technological advances is business communications. More businesses are making the transition away from using traditional phone lines and instead, use the internet to make as well as receive phone calls. This technology that offers businesses the ability to exchange calls over the internet is known as Voice over Internet Protocol (VOIP).

There are two different models that can be adopted by businesses switching over from regular phone lines to VOIP, namely hosted VOIP and SIP trunking. The discussion below provides further information about SIP trunking and how its adoption can enhance your business' communication processes.

What is SIP Trunking?

SIP is an acronym for Session Initiated Protocol; this protocol defines how two or more parties exchange voice calls over the internet. SIP trunking involves the transmission of voice messages across data networks such as the internet or a company's local area network (LAN); it is the digital equivalent of copper lines in an analog phone system. SIP trunking establishes communication between the relevant parties at the beginning of a voice call and terminates the communication at the conclusion of the call. With SIP trunking, businesses can use their existing network infrastructure to make and receive voice calls; there is no need to develop an additional network infrastructure. Currently at $7.6 billion, the global market for SIP trunking is projected to increase to $12.7 billion by 2023 at a Compound Annual Growth Rate (CAGR) of 10.7%.

Requirement for SIP Trunking

There is a low barrier to entry for businesses wishing to set up SIP trunking. The basic requirements are:

  • Internet Telephony Service Provider (ITSP): A contract has to be established with an ITSP to use its telecommunication services for VOIP.
  • IP phones: These enable users to place voice calls over the internet or LAN.
  • IP private branch exchange (PBX): The IP PBX is a server that has the directory of all IP phones and their corresponding IP addresses. It is used to route calls to its desired destination; a VOIP Gateway may sometimes be needed for the IP PBX to route the calls effectively.

Benefits of SIP Trunking

Some of the benefits of SIP trunking include:

  • Decreased phone bills: SIP trunking can result in significantly lower call rates thereby leading to lower monthly phone bills.
  • Easy set up: SIP trunking is relatively easy to set up. There is no need to abandon or significantly upgrade existing network infrastructure when setting up SIP trunking.
  • Easy scalability: Unlike analog phone lines which have restrictions as to the number of users it can accommodate at any given time, SIP trunking has no such finite capacity. Therefore, it can be scaled as necessary to accommodate the communication needs of any business.
  • Non-proprietary: SIP trunking is open source and non-proprietary. This means that there are no licenses that need to be obtained before it can be used and therefore it is free to use. In addition, SIP trunking can be used by any system as long as it is compatible with the SIP protocol.
  • Business continuity: SIP trunking allows for business continuity during disaster recovery. With voice communication occurring over the internet, there is a reduced risk of its disruption after a disaster. If cloud services are used for SIP trunking, communication can be easily restored with minimal effect on business operations.
  • Virtual numbers: With SIP trunking, businesses can set up virtual numbers with local area codes. Customers can contact the businesses using these virtual numbers at a cost far cheaper than using international long distance numbers.

The Bottom Line

At NewCloud Networks, we know all about SIP trunking. We have experts available to work with you in setting up SIP trunking to meet the communication needs of your business. For more information about how we can meet your communication needs, contact us.

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About the author
Sydney Boman

Sydney Boman is the Marketing Assistant at NewCloud Networks

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