SIP trunking is the option most Australian businesses hear about third, after hosted PBX and after "just move everyone to Teams" and it’s the one most often either bought unnecessarily or dismissed too quickly.
The confusion is understandable, because SIP trunking and hosted PBX solve overlapping problems in completely different places. This guide explains what a trunk actually is, how many channels you need (the answer is smaller than you think), what it costs in Australia in 2026, and the single question that decides whether trunking or a hosted platform is right for you.
The one-sentence version
A SIP trunk replaces your phone lines. A hosted PBX replaces your phone system. If you’ve a PBX you want to keep, you need trunks; if you do not, you almost certainly want hosted.
1. What a SIP Trunk Actually Is
A SIP trunk is a virtual connection between your own phone system and the public telephone network, delivered over your internet connection instead of over physical copper or ISDN circuits.
The word "trunk" is inherited from the analogue world, and it’s the reason people misunderstand it. An ISDN30 was a physical bundle of 30 voice circuits terminating on your premises. A SIP trunk is the same idea with the physical part removed: a logical bundle of concurrent call paths, provisioned in software, carried as data.
Three things a SIP trunk does not do, all of which people assume it does:
- It doesn’t give you a phone system. No extensions, no voicemail, no auto attendant, no ring groups. Your PBX provides all of that; the trunk just carries calls in and out of it.
- It doesn’t include handsets or apps. Those register to your PBX, not to the trunk.
- It doesn’t manage itself. Somebody has to own the PBX: patching, backups, security, dial plan changes.
What it does do is decouple your call capacity from physical infrastructure, usually at a fraction of the cost of the ISDN service it replaces. If you’re on ISDN today, that replacement is no longer optional: see our ISDN and PSTN shutdown migration guide for the timeline.
2. How Many Channels Do You Actually Need?
A channel is one concurrent call. Not one user, not one handset, not one phone number: one simultaneous conversation. This is where most businesses over-buy, because the ISDN world trained everyone to think in blocks of 10, 20 or 30.
Concurrency in a typical office is far lower than headcount. The rule of thumb we use as a starting point:
| Business type | Concurrency ratio | 20 staff → channels | Why |
|---|---|---|---|
| General office / professional services | 1 channel per 4–5 users | 4–5 | Most staff are on the phone a fraction of the day |
| Trades / field services (office staff only) | 1 per 3–4 users | 5–7 | Dispatch and scheduling drive higher call rates |
| Sales / appointment setting | 1 per 1.2–1.5 users | 14–17 | Near-continuous outbound dialling |
| Inbound support desk | 1 per 1–1.2 users | 17–20 | Agents are on calls by design, plus queue overflow |
Two adjustments to whatever number that gives you:
- Add headroom for the busy hour, not the average. Your peak is typically 2–3× your daily mean. Size for the peak or callers get engaged tones at exactly the moment they matter most.
- Add queue depth if you run one. A caller waiting in a queue is occupying a channel. A support desk with 8 agents and a 6-deep queue needs 14 channels, not 8. This is the single most common sizing mistake we see.
Ask for burst
Most Australian SIP providers now offer burstable channels: you commit to a baseline and pay a per-minute rate for calls above it. If your traffic is seasonal (retail in November, accountants in July, anyone in the fortnight after a marketing campaign), burst capacity is far cheaper than permanently provisioning for your worst week. Ask for it explicitly; it’s rarely on the standard rate card.
3. What SIP Trunking Costs in Australia
Australian SIP trunk pricing has three components, and comparing providers on any one of them in isolation will mislead you.
| Component | Typical 2026 range (AUD) | What to watch |
|---|---|---|
| Per channel, per month | $8 – $20 | Cheapest headline rates often exclude calls entirely |
| Number (DID) hosting | $1 – $3 per number/month | Adds up fast if every staff member has a direct line |
| Call rates, local & national | $0.05 – $0.12 untimed, or bundled | “Untimed” vs per-minute is a large difference on long calls |
| Call rates, mobile | $0.10 – $0.25 per minute | Usually your largest single call cost in Australia |
| 13/1300/1800 inbound service | $10 – $30 per month + per-call | Separate from the trunk; see our 1300 number guide |
| Setup / porting | $0 – $55 per number | Complex ports cost more; often waived on contract |
A worked example for a 20-person professional services firm keeping its existing PBX, needing 6 channels and 22 direct numbers:
- 6 channels × $14 = $84
- 22 DIDs × $2 = $44
- Call spend, mixed traffic = $120–$180
- Total: roughly $250–$310 per month, or $12.50–$15.50 per user
That’s cheaper per user than any hosted PBX in our 2026 comparison, which start at $28.30. But the comparison is incomplete, and the next section is why.
4. The Cost That Is Not on the Quote
The $12.50 per user above buys you dial tone. It doesn’t buy you a phone system, and the phone system isn’t free just because you already own it.
Running your own PBX carries ongoing costs that a hosted platform absorbs into its per-seat price:
| Ongoing cost | Typical annual impact |
|---|---|
| PBX software licensing / support contract | $600 – $4,000+ |
| Server hosting or on-premises hardware refresh | $500 – $2,500 amortised |
| Security patching and firmware maintenance | Staff time, or $1,200+ on a managed contract |
| Session Border Controller (if required) | $800 – $3,000 one-off |
| Dial plan and moves/adds/changes | Staff time, or $150–$250/hr on call-out |
| Disaster recovery / failover design | Varies; frequently skipped, then regretted |
Add a conservative $3,000 a year to that 20-person example and the effective cost rises to about $25 per user per month: at which point a hosted platform that includes apps, AI, updates and support for $28.30 is a close call, and arguably the better buy.
Where trunking clearly wins on cost
The economics flip decisively in your favour when the fixed PBX overhead is spread across more seats. At 100 users, that same $3,000 of annual overhead is $2.50 per user per month rather than $12.50. This is why SIP trunking remains standard at enterprise scale and is usually a false economy under about 30 seats.
5. SIP Trunking vs Hosted PBX: The Deciding Question
Strip away the feature matrices and it comes down to one thing: do you’ve a PBX you’ve a good reason to keep?
Good reasons exist, and they’re not sentimental:
- Heavy custom integration. A PBX wired into a dispatch system, a hospital paging system or a bespoke line-of-business application represents real sunk engineering.
- Regulatory or contractual constraints that require on-premises call control or recording.
- Recent capital investment. A PBX bought two years ago on a five-year depreciation schedule.
- Genuine scale. Above roughly 100–150 seats the per-user economics favour owning the platform.
- Specialist requirements a hosted platform won’t accommodate: unusual dial plans, analogue device fleets, site-to-site tie lines.
If none of those describe you, realistically, SIP trunking is solving a problem you don’t have. You would be buying lines for a system you would be better off retiring.
SIP trunking fits when…
- You own a modern PBX with life left in it
- You’ve IT capability in-house or on retainer
- You’re above roughly 50–100 seats
- You’ve integrations that would be expensive to rebuild
- You need on-premises call control for compliance
Hosted PBX fits when…
- Your PBX is end-of-life or you’ve none
- You’ve no dedicated IT resource
- You’re under about 50 seats
- You want mobile and desktop apps included
- You want AI features without building them
There’s also a middle path worth knowing about. Some businesses run a hosted platform for the bulk of their users and keep a small SIP trunk for a legacy site, a lift phone or an alarm dialler. This is often the cheapest way to handle the awkward remnants of an on-premises estate without holding the whole migration hostage to them.
6. The Technical Requirements Nobody Mentions
A SIP trunk is only as good as what it runs over. These are the requirements that determine whether your calls sound professional or like a bad speakerphone.
- Bandwidth. Budget roughly 100 kbps per concurrent call in each direction using G.711, or about 30 kbps with G.729 compression. Six channels needs around 600 kbps up and down: trivial on NBN, but it must be available, not just theoretically present.
- A static IP address or a registration-based trunk. Many providers authenticate by IP, which doesn’t work on a dynamic residential-grade connection.
- QoS on your router to prioritise voice over bulk traffic. Without it, one large file upload degrades every call in progress. Our NBN call quality guide covers the configuration in detail.
- A firewall that understands SIP or more precisely, one whose SIP ALG you’ve turned off, because a half-implemented ALG causes more one-way-audio faults than any other single cause.
- A Session Border Controller if your PBX sits directly on the internet. This is a security requirement, not a nicety.
- Failover. Decide now what happens when the internet drops: divert to mobiles at the carrier level, a second connection, or accept the outage. Deciding during the outage isn’t a plan.
7. Toll Fraud: The Risk That Justifies the Effort
An internet-facing PBX with weak credentials is a target, and Australian businesses have been hit with five-figure bills over a single weekend. The attack is simple: compromise an extension, dial premium-rate international destinations continuously until someone notices on Monday.
Minimum defences, all of which your provider or PBX supports:
- Bar international dialling by default and enable it per-extension only where needed. This alone eliminates most exposure.
- Set a hard spend cap with your trunk provider, with SMS alerting on breach.
- Restrict SIP registration by IP where your users are on fixed locations.
- Enforce strong, unique extension secrets, never the extension number, never a default.
- Set an out-of-hours concurrent call ceiling. Legitimate traffic at 3am is rare; fraudulent traffic at 3am is the norm.
Our phone system security and compliance guide goes further into encryption, recording consent and Privacy Act obligations.
8. Choosing an Australian SIP Provider
Beyond price, these are the questions that separate providers once you’re past the headline rate:
- Where does the media terminate? An Australian provider routing your audio via Singapore adds latency you’ll hear.
- Is the trunk on your carrier's own network or resold? Resale is fine, but it determines who can actually fix a fault.
- What is the fault escalation path, and in which timezone?
- Untimed or per-minute for local and national? Model both against your call durations.
- Is burst capacity available, and at what rate?
- Can you port your existing numbers, and how long will it take? Our porting guide covers realistic timeframes.
- What happens to inbound calls if the trunk is unreachable? Carrier-level divert should be configurable by you, not via a support ticket.
- Is there a minimum term, and what is the exit cost?
9. The Bottom Line
SIP trunking is mature, cheap and reliable, and for the right business it’s the most cost-effective way to connect a phone system to the outside world. If you’re running ISDN into a PBX you intend to keep, replacing those circuits with SIP trunks is straightforward and will cut your line costs substantially.
But the question that decides it’s not "is SIP trunking good?": it’s "should I still be running my own PBX?" For most Australian businesses under 50 seats in 2026, the answer is probably no, and buying trunks is an expensive way to defer that conclusion by a few years.
Work out the total cost including the PBX overhead, not just the trunk quote. If the numbers land close, choose the option that doesn’t require you to become a telephony administrator.
Frequently Asked Questions
What is SIP trunking in simple terms?
A SIP trunk is a virtual replacement for physical phone lines. It connects your own phone system (PBX) to the public telephone network over your internet connection instead of over copper or ISDN circuits. It carries calls in and out, but it doesn’t provide the phone system itself: no extensions, voicemail or auto attendant. Those come from your PBX.
How many SIP channels does a 20 person business need?
Usually 4 to 7 channels for a general office, because concurrency is far lower than headcount. A rule of thumb is one channel per 4 to 5 users for professional services, one per 3 to 4 for trades and dispatch, and close to one per user for sales or support desks. Size for your busy hour rather than your daily average, and add channels for queue depth: callers waiting in a queue each occupy a channel.
How much does SIP trunking cost in Australia?
Expect AUD $8 to $20 per channel per month, $1 to $3 per direct number, and call rates of roughly $0.05 to $0.12 for local and national plus $0.10 to $0.25 per minute to mobiles. A 20-person firm needing 6 channels and 22 numbers typically pays $250 to $310 per month, around $12.50 to $15.50 per user, before the cost of running the PBX itself.
Is SIP trunking cheaper than hosted PBX?
On the quote, yes. In total cost, often no. The trunk price excludes PBX licensing, hosting, patching, a session border controller and the staff time to administer it: commonly $3,000 or more a year. For a 20-user business that lifts the effective cost to around $25 per user per month, close to hosted PBX pricing that already includes apps, AI features, updates and support. Trunking wins clearly above roughly 100 seats, where fixed overhead is spread thinner.
Do I need a static IP address for SIP trunking?
Usually yes, or a registration-based trunk instead. Many Australian SIP providers authenticate the trunk by source IP address, which doesn’t work reliably on a dynamic connection. Confirm which authentication method your provider uses before ordering your internet service.
What causes one-way audio on a SIP trunk?
The most common cause by a wide margin is a SIP ALG (Application Layer Gateway) enabled on the router or firewall. Most consumer and small-business routers ship with it on, and most partial implementations break SIP rather than help it. Turning SIP ALG off resolves the majority of one-way-audio faults. Remaining causes are NAT traversal misconfiguration and firewall rules blocking the RTP media port range.
Can SIP trunking replace ISDN?
Yes, and it’s the standard replacement path for businesses keeping an existing PBX through the ISDN and PSTN shutdown. A SIP trunk delivers the same concurrent-call capacity as an ISDN service at substantially lower cost, and your existing numbers can be ported across. If your PBX is also end-of-life, moving to a hosted platform instead is usually the better decision.