Compare architecture, cost, scalability, and call quality to decide which voice model fits your business.
SIP and VoIP are related but distinct: SIP is a protocol that enables VoIP. Understanding the nuances between the two gives you an advantage when building your businesses’ communication solution.
Key points
Voice over Internet Protocol (VoIP) is a method of delivering phone communications through internet networks—in simpler terms, VoIP enables phone calls over the internet. VoIP is a popular calling solution amongst businesses due to the vast amount of existing broadband infrastructure and gradual decommissioning of the globally.
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Here’s how VoIP works: VoIP networks use packet switching technology to transmit audio signals. When you place a call from a VoIP number, a local VoIP network connects your VoIP device (desk phone, mobile phone, or softphone) to a carrier network. The VoIP device converts the audio signal into data packets, transmits the packets over digital networks, and—on the other end of the line—turns the packets back into sound.
VoIP infrastructure is made up of both hardware and software, including an internet connected device (laptop, smartphone, handset, or tablet), router, PBX, registrar, proxy server and back to back user agent (B2BUA).
Hosted VoIP enables businesses to outsource their VoIP telephony infrastructure to a third-party provider, using their servers, hardware and software for a fee. Hosted VoIP can be more cost-effective than non-hosted, since you don’t have to purchase, install and maintain infrastructure, which makes it ideal for many small businesses.
Non-hosted VoIP is self-owned and maintained telephony infrastructure. If you use non-hosted VoIP, you are responsible for all housing and maintenance of VoIP-related servers and hardware on your premises. Non-hosted VoIP often uses PBX, which connects internal lines through use of extensions. Compared to hosted VoIP, non-hosted is easier to customize and has better data security. Non-hosted VoIP installation and maintenance costs can add up, but it can still save you money over time. Non-hosted VoIP can be a good option for larger businesses that have the money for up front costs and space to house infrastructure.
Session Initiation Protocol (SIP) is used to initiate, maintain and terminate multimedia sessions within VoIP applications. Simply put, these multimedia sessions can integrate voice, video, fax and messaging into a call.
Here’s how SIP works: the protocol sends data packets between two endpoints called SIP addresses. Person 1 initiates a call, which triggers an invite. The invite is sent through proxy servers, which act as automated switchboard operators. The proxy server transmits the call invite to person 2, who uses a SIP-enabled device to answer the call. For more information about the way SIP works, check out this blog post about SIP response codes.
SIP enables SIP trunking, which is an essential component of any growing business’s VoIP system. A SIP trunk acts as a virtual phone line and, like VoIP, also uses packet switching to connect calls. Whereas VoIP alone only supports voice, SIP trunking supports voice, video, messaging and fax.
Interest in SIP trunking hit a low point in 2023, but has been climbing sharply ever since as businesses prioritize scalable, IP-based voice infrastructure.
Here’s how SIP trunking works: a SIP trunk contains multiple channels, and each SIP trunk channel can connect a single phone call. When you make an outbound call through your SIP trunk, your device initiates a session that occupies one channel. That channel connects your call to the public internet or your telcom carrier’s network, and sends a signal to complete the call. If another person makes a call on your SIP trunk at the same time, that call uses a different channel, but both calls are transmitted over the same trunk.
SIP trunks reduce the amount of infrastructure your business needs: you can add many channels to a single SIP trunk, which allows you to have multiple phone lines. Without SIP trunks, you’d need to pay for individual lines each time you hired a new employee. VoIP is the backbone of the communications stack here; you can add SIP protocol and SIP trunking features to your VoIP system to create a scalable, customized communication solution for your business.
Hopefully it’s clear by now that “SIP versus VoIP” is not an effective question. SIP is one of the most prevalent protocols used to deploy many types of VoIP communications. VoIP is an umbrella term that encompasses many different protocols for voice communications over the internet, including voice calls. SIP is a protocol that describes how VoIP calls are established, maintained, and disconnected. As such, SIP is a subprotocol that enables VoIP.
| Pros of just VoIP | Cons of just VoIP |
|---|---|
| Low cost | Requires sufficient bandwidth to maintain call quality |
| No on-site installation, easy to relocate | Only voice—no multimedia communications |
| No long-term contracts required | Lacks integration with third party apps/software |
| Pros of SIP with VoIP | Cons of SIP with VoIP |
|---|---|
| Easy to scale—can add video, messaging, etc | Requires sufficient bandwidth to maintain call quality |
| Easy to integrate with common third party apps/software | Not all providers are equal—choose one that offers features you need and quality service |
| Integrate PRI lines for a combo system | Potential for quality and security issues if used on public internet |
| Flexible pricing—pay for what you need |
VoIP phones are any phones that can make calls over the internet, provided you have a VoIP network or subscription. SIP phones give you multimedia functionality and connect to VoIP networks without any additional hardware. Visually, it’s tricky to tell the difference between a phone that is SIP-enabled and one that is not. However, most phones today are SIP-enabled.
Hopefully it’s clear by now that SIP and VoIP can’t be directly compared, since they function differently. However, understanding the role both play in telecommunications can help you decide whether VoIP alone or VoIP with SIP is right for your business.
The first step is to decide if voice communication alone meets your needs, or if you require a more robust solution. VoIP is cost effective and it’s relatively easy to implement this voice-only solution. You can enhance VoIP by adding SIP capabilities, which offers more flexibility and is a Unified Communications (UC) solution. Adding SIP can cut costs over time by streamlining your call flows, enhancing customer experience and maximizing your team’s productivity.
With Telnyx SIP trunking, users can count on carrier-grade quality and low latency communications. Our portal and APIs allow you to build your own scalable solution with highly configurable features for better control over all elements of your calls, including cost. Plug and play VoIP setup in minutes with carrier-grade voice using using the Telnyx portal and APIs.
Contact our team of experts to learn how you can leverage Telnyx SIP trunking for your business.
