18 Dec 2023

In the rapidly changing telecom industry for better business communication, the choice between Hosted PBX phone system and SIP trunk services plays a very important role in shaping a business's telephony infrastructure. These two solutions represent distinct approaches to managing voice and data services, each offering unique advantages and considerations. This comparison takes us into the key differences between Hosted PBX and SIP trunking, evaluating factors such as hardware costs, ongoing expenses, scalability, call features, call quality, maintenance, geographical flexibility, software interface, system reliability, and compliance and security.

Hosted PBX system is a virtual PBX system leveraging VoIP and cloud technology that caters to businesses seeking flexibility, accessibility, and minimal on-site hardware requirements. On the other hand, SIP trunking services establishes a direct connection between on-premise PBX systems and the internet, offering high reliability, dedicated phone lines, and a focus on call quality.

This comprehensive analysis aims to guide businesses in understanding the complexities of these communication solutions. By looking into hosted pbx vs sip trunking, businesses can make informed decisions aligned with their specific needs, size, and growth aspirations. Additionally, we explore the ideal business scenarios for each solution, shedding light on which type of business is best suited for Hosted PBX or SIP Trunking. By navigating through these distinctions, businesses can choose the telephony approach that aligns seamlessly with their communication requirements and operational preferences.

What is hosted PBX

A hosted PBX is a virtual phone system using VoIP (Voice Over Internet Protocol) and cloud technology, allowing businesses to make internet-based calls and manage communications through a third-party provider without the need for on-site hardware. It offers flexibility and accessibility from any internet-connected device.

What is SIP trunking?

SIP trunking is a hosted VoIP service linking your on-premises PBX to the internet, utilising existing company hardware managed by your IT staff. It establishes a direct virtual connection between your PBX and VoIP. SIP trunks replace traditional landlines, supporting voice, video, emails, and data on a single line, eliminating the need for extra lines.

Unlike hosted PBX, which relies on a third-party provider or cloud based, SIP trunking requires either an on-site IP-enabled PBX or a VoIP gateway to connect your traditional PBX to the cloud, based on your current phone system.

Top 10 Differences between hosted PBX and SIP trunking

1. Hardware costs

  • Hosted PBX

Setting up a Hosted PBX system requires essential hardware such as IP phones, routers, and a business-grade broadband service. The actual PBX servers are hosted and maintained by the provider, eliminating the need for additional hardware and resulting in cost savings on initial startup.

  • SIP trunking

Contrastingly, on-premises PBX and SIP trunking demand significant upfront capital expenditure. On-site installation of IP PBX servers and connecting to a SIP trunking service are necessary. It's common to recommend a separate Internet connection for the SIP trunking service.

2. Ongoing Costs

  • Hosted PBX

Hosted PBX entails a monthly subscription fee for VoIP service, with providers offering various packages billed per user, feature, or calling minute.

  • SIP trunking

SIP trunking services often employ a per-channel pricing scheme, allowing one simultaneous phone call per channel. Alternatively, they may charge per minute, with rates varying among providers.

3. Scalability

  • Hosted PBX

Hosted VoIP services offer virtually unlimited space for users, allowing easy addition of phones and users through a user-friendly process, often manageable even by non-IT professionals. A single PBX can usually handle up to a couple of hundred phones.

  • SIP trunking

SIP trunking systems can scale to some extent but require additional on-premise servers and configuration of dial plans for significant expansion.

4. Call features

  • Hosted PBX

Hosted PBX providers compete to offer advanced business calling features, driving innovation in third-party integrations, real-time communication add-ons, call center reporting, and video conferencing.

  • SIP trunking

SIP trunking systems may lack these features unless a dedicated software engineer is available to build and maintain custom telephony applications.

5. Call Quality

  • Hosted PBX

Internet connectivity plays a pivotal role in call quality for both SIP trunking and Hosted PBX. Issues like jitter, delay, packet loss, or insufficient bandwidth can degrade calls.

  • SIP trunking

SIP trunking services with dedicated connections enhance swift connectivity and call quality.

6. Maintenance

  • Hosted PBX

Hosted PBX users enjoy minimal maintenance responsibilities, focusing on internal housekeeping tasks. Server and software maintenance are handled by the service provider's dedicated IT staff.

  • SIP trunking

In contrast, SIP trunking services require internal management, including server upkeep, software updates, and potential scheduled downtime for system upgrades.

7. Geographical flexibility

  • Hosted PBX

Hosted PBX excels in geographical flexibility, enabling access to the phone system outside the office, facilitating remote work or travel. Features like webphones and mobile apps empower users to connect from various devices. But there may be some kind of limitations based on the service provider's coverage.

  • SIP trunking

Whereas business seeking to operate globally or targets specific geographic markets, SIP trunking can provide virtual phone numbers in different locations, giving you a local presence.

8. Software interface

  • Hosted PBX

Hosted PBX users benefit from an online Admin Portal Like Wavetel's HUB UC (Dialler Systems) designed for ease of use, with overall system maintenance handled by the VoIP provider.

  • SIP trunking

Maintaining an SIP trunking demands networking and software management expertise, with the need for an IT staff member critical for system upkeep.

9 System Reliability

  • Hosted PBX

Hosted PBX depends on the strength and reliability of the user's Internet connection. Weaker connections may lead to poor call quality and temporary service loss. Further, factors like weather conditions, high call volumes, insufficient bandwidth (below 500 kbps), and reliance on WiFi over Ethernet can impact call quality.

  • SIP trunking

SIP trunking’s reliability is high as the system automatically switches to backup power sources. Further, it offers dedicated phone lines, enhancing overall system reliability.

10 Compliance and security

  • Hosted PBX

Hosted PBX security can be compromised with open ports, leaving systems vulnerable. Security relies on the provider's standards, as they maintain a secure environment for your system.

  • SIP trunking

SIP trunking offers superior security with a dedicated connection, reducing bandwidth usage. Security depends on your policies, and SIP trunking provides redundancy and backup systems for enhanced infrastructure security. Your company is responsible for handling cybersecurity incidents and ensuring compliance.

Hosted PBX Vs SIP trunking: Choose Suitbale Option for your Business

# Hosted PBX SIP Trunking
Hardware Costs
  • ✓ Requires IP phones, routers.
  • ✓ PBX servers hosted and maintained by the provider.
  • ✓ Significant upfront capital expenditure for on-premise IP PBX servers.
  • ✓ Separate internet connection for SIP trunking.
Ongoing Costs
  • ✓ Monthly subscription fee.
  • ✓ Billed per user, feature, or calling minute.
  • ✓ Wavetel offer services at lowest prices from £4.99 as compared to other providers like BT, Nextiva, Ringcentral, Vonage, and CallHippo etc.
  • ✓ Per-channel pricing or per-minute charges.
  • ✓ Rates vary among providers.
  • ✓ Wavetel charges at lowest prices as £9.00 /TRUNK/MTH (with Unlimited Calls to UK Landline and Mobile.
  • ✓ Virtually unlimited space for users.
  • ✓ Easily scalable.
  • ✓ Scalability Virtually unlimited space for users; easily scalable.
  • ✓ Scalability limited without additional on-premise servers and dial plan configuration.
Call Features
  • ✓ Competes to offer advanced features, integrations, real-time communication, call center reporting, and video conferencing.
  • ✓ May lack advanced features without custom telephony applications.
Call Quality
  • ✓ Internet connectivity affects call quality.
  • ✓ Potential issues include jitter, delay, packet loss, or insufficient bandwidth.
  • ✓ Dedicated connections, enhance swift connectivity and call quality.
  • ✓ Minimal maintenance responsibilities.
  • ✓ Server and software maintenance handled by the provider.
  • ✓ Requires internal management, including server upkeep, software updates, and potential downtime.
Geographical Flexibility
  • ✓ Enables access outside the office; supports remote work with features like web phones and mobile apps.
  • ✓ Provides virtual phone numbers in different locations for a local presence worldwide.
  • ✓ Suitable for global operations.
Software Interface
  • ✓ Online Admin Portal for ease of use; system maintenance handled by VoIP provider.
  • ✓ Requires networking and software management expertise; IT staff critical for system upkeep.
Compliance and Security
  • ✓ Compliance and Security, depends on the provider's standards.
  • ✓ Potential vulnerability with open ports, incidents and compliance.
  • ✓ Offers superior security with a dedicated connection.
  • ✓ Company responsible for cybersecurity incidents and compliance.


Which business is right for hosted PBX?

Hosted PBX is suitable for small to medium-sized businesses with remote or blended work setups, lacking on-premise PBX equipment and preferring third-party management. These users prioritise flexibility, mobility, and scalability but may compromise on certain aspects, such as concurrent calls and full security control. They are likely to remain in the SMB category and may consider adding advanced VoIP features in the future.

Which business is right for SIP trunking?

SIP Trunking is ideal for enterprise-level teams of 50 or more, preferring to use existing phone system equipment or having their in-house PBX solution. Users prioritise high call quality, security, and the ability to add phone lines individually as they grow. They seek greater control over their premise-based phone system compared to relying on a third-party provider.

How can you determine the most suitable option for your business needs

After going through the hosted PBX vs SIP trunking comparison, it's decision time. Despite their shared features and benefits, both serve as the pillars of a modern and reliable VoIP network. Always, consider the following key questions to pinpoint the best option for your needs:

  • What is your current business size, and do you anticipate growth or expansion?
  • Do you already have PBX equipment in place?
  • How much flexibility do you require in your phone system?

SIP trunking often emerges as the preferred choice, delivering heightened security, long-term cost efficiency, flexibility, and superior quality of service, particularly for medium to large enterprises. Take the time to look into both options. It pays off in well-informed decisions from technical, financial, and logistical perspectives. Evaluate cost efficiency on a long-term scale, especially concerning setup costs.

With our SIP trunking platform, you can optimise your business communications, enjoy crystal-clear audio, reduce current bills, and eliminate per-minute charges—all without disrupting your service. Imagine an efficient customer support team and delighted customers.

For a feature-rich IP-based system that aligns with your needs, Wavetel Business offers hosted VoIP and SIP trunk services as a leading UK SIP trunk provider. Get in touch to ensure your communications setup scales seamlessly with your business.


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