If your business already runs Microsoft 365, adding calling to Teams looks like the obvious move. Everyone is already in the app, the chat and meetings work, and there’s no new software to learn. Plenty of Australian businesses have made that choice and been happy with it.
Plenty of others have made it and quietly bought a separate phone system eighteen months later, because the reception team couldn’t do what they needed. This guide is about telling those two situations apart before you commit.
1. The Four Options Explained
Option A: Microsoft Calling Plans
You buy the Teams Phone licence and the call plan from Microsoft. Microsoft is your carrier. Simplest to set up, and the least flexible commercially. You take Microsoft's rates and inclusions.
Option B: Operator Connect
You keep Teams as the calling client but buy the actual telephony from a participating Australian carrier, connected through Microsoft's portal. Setup is largely point-and-click, and you get local carrier billing and support for the voice side.
Option C: Direct Routing
A session border controller (yours or a provider's) connects Teams to a SIP carrier of your choice. The most flexible and the most technical. It’s how most larger or more complex Australian deployments are done, and it usually involves a partner.
Option D: Dedicated cloud PBX
A purpose-built phone platform with its own apps and desk phone support, running alongside Microsoft 365 rather than inside it. Teams stays for chat and meetings; the phone system does the phone work.
2. Side-by-Side Comparison
| Factor | Teams Phone (A/B/C) | Dedicated Cloud PBX |
|---|---|---|
| User experience | One app for chat, meetings and calls | Separate app, purpose-built for calling |
| Advanced call handling | Basic auto-attendant and call queues; limited compared with a PBX | Deep: queues, skills routing, overflow, time-based rules, barge/whisper |
| Desk phone support | Limited to certified Teams devices, generally more expensive | Broad SIP handset support at competitive prices |
| Reception console | Functional but basic; third-party add-ons common | Purpose-built with busy lamp fields and drag-and-drop transfer |
| Call recording | Usually a third-party add-on with its own licence | Typically included |
| Analytics | Call quality focused; business reporting is thinner | Business-focused: answer rates, abandonment, agent performance |
| AI voice agents | Available via Microsoft's ecosystem, generally at additional cost | Increasingly included, with local voices |
| Support model | Split between Microsoft, carrier and partner | Single provider for the whole voice stack |
| Works without Microsoft 365 | No | Yes |
3. The Real Cost in Australia
Teams calling looks inexpensive until you total the components. A realistic stack for a 20-user Australian business:
- Microsoft 365 Business Standard: already paid (assume sunk)
- Teams Phone licence: ~$12–$15
- Calling plan or carrier SIP service: ~$10–$25
- Call recording add-on: ~$8–$15
- Contact centre / advanced queue add-on (if needed): ~$25–$60
- Certified Teams desk phone: $350–$600 one-off, where needed
Typical all-in: AUD $30–$55 per user per month, before contact centre features
- All-inclusive seat with calls, recording, queues and apps: $28–$45
- SIP desk phone: $120–$350 one-off, where needed
- Setup and porting: often included
Typical all-in: AUD $28–$45 per user per month, features included
The gap isn’t enormous at the entry level. It widens considerably once you need call recording for everyone, real queue reporting, or a reception console. Each of which is an add-on in the Teams stack and standard in most cloud PBX platforms. The hardware difference is also material if you need desk phones: certified Teams handsets typically cost two to three times a comparable SIP phone.
4. Where Teams Phone Falls Short
- Reception and busy call handling. A receptionist juggling six calls needs a console with instant visibility of who is free. This is the most common reason Australian businesses add a PBX after adopting Teams calling.
- Complex call flows. Multi-level routing with overflow, priority, and time-based rules is achievable but clumsy compared with a purpose-built PBX.
- Shared and common-area devices. Warehouse phones, lunch room phones, and lift phones fit awkwardly into a per-user licensing model.
- Analogue and specialty devices. Paging systems, door intercoms, and fax lines need gateways and additional design work.
- Support attribution. When call quality is poor, is it Microsoft, the carrier, the SBC, or your network? Split responsibility is fine until an outage, at which point it’s the whole problem.
- Licence dependency. Every phone user needs an appropriate Microsoft licence. For businesses with frontline staff who don’t otherwise need Microsoft 365, that’s a substantial cost multiplier.
The frontline staff question
Ask how many people in your business need a phone but don’t need a full Microsoft 365 licence: warehouse staff, workshop, reception relief, casual retail. If that number is more than a handful, Teams calling becomes disproportionately expensive, because you end up buying software licences to justify a phone.
5. Where Teams Phone Wins
- Knowledge-worker organisations where everyone already has a Microsoft licence and calls are mostly one-to-one, not queue-based.
- Meeting-heavy cultures where the phone is secondary to Teams meetings and chat.
- Businesses standardised on Microsoft governance: compliance, eDiscovery, retention and conditional access all applied consistently across one platform is a real advantage for regulated organisations.
- Global organisations with existing Microsoft enterprise agreements and internal IT capability.
- Simplicity of vendor count where IT resources are stretched and one fewer supplier matters.
6. The Hybrid Approach
The option most Australian businesses overlook: run both, deliberately.
- Teams for internal chat, meetings, and colleague-to-colleague calls
- A dedicated cloud PBX for external business calls, reception, queues, and customer-facing numbers
- Integration so presence is shared and click-to-call works from either place
This costs a little more per user than the cheapest single-vendor option, and it gives the reception team a proper console while leaving the collaboration stack untouched. For businesses where the phone is a revenue channel (trades, medical, professional services, wholesale) it’s frequently the right answer.
7. A Decision Framework
Answer these six questions honestly:
- Is the phone a primary revenue channel for you? If customers ring you to buy, lean toward a dedicated PBX.
- Do you’ve a dedicated receptionist or a call queue with real volume? Yes points to a PBX.
- Does everyone who needs a phone already have a Microsoft 365 licence? No points to a PBX.
- Do you need desk phones, shared phones or analogue devices? Yes points to a PBX.
- Do you’ve internal IT capability or a managed partner? No points away from Direct Routing specifically.
- Is single-vendor Microsoft governance a compliance requirement? Yes points to Teams Phone.
Four or more answers pointing to a PBX means a dedicated platform will serve you better, even though you already own Teams.
8. Our Recommendation
For most Australian small and medium businesses, particularly those where customers ring the business rather than an individual, a dedicated cloud PBX alongside Teams delivers better call handling at a lower total cost than building the phone system inside Teams.
Uniden Voice over Cloud is our top-rated option for that role: 40+ call flow features included, broad SIP handset support at sensible prices, three devices per user, AI call agents with Australian voices, CRM integration, and Australian-based support: from AUD $28.30 per user per month with free setup and porting.
If your business is meeting-centric, fully licensed on Microsoft 365, and has no reception function to speak of, Teams Phone via Operator Connect with an Australian carrier is a perfectly sound choice. The mistake is assuming that because Teams is already there, it must be the cheaper or simpler option: for a business that lives on the phone, it usually is not.