SIP Trunks vs Hosted VoIP — What's the Difference and Which Do You Need?

When businesses start researching how to replace their ISDN lines before the 2027 switch-off, two terms come up constantly: SIP trunks and hosted VoIP. They're often used interchangeably, but they're actually quite different products suited to different situations.

The Simple Version

SIP trunks replace your phone lines but keep your existing phone system (PBX). Think of it as swapping the pipes while keeping the same plumbing.

Hosted VoIP replaces both your phone lines AND your phone system. Everything moves to the cloud. You get new phones (or apps), and the whole system is managed remotely.

SIP Trunks — When They Make Sense

If your business has an existing on-premise PBX — a physical phone system box on your wall, whether it's a Panasonic, Avaya, Cisco or similar — SIP trunks let you keep it. Instead of ISDN lines plugging into the PBX, SIP trunks connect it to the internet, and calls travel over your broadband connection.

This makes sense when:

• Your PBX is less than 5–7 years old and has good remaining life
• You've made significant investment in specialist PBX configuration you'd lose in a migration
• You have a large number of physical handsets that work well and you don't want to replace
• You want to keep existing call routing, voicemail and hunt group configurations unchanged

Hosted VoIP — When It Makes Sense

Hosted VoIP replaces everything. Your phone system lives in the cloud — managed by Telexico, updated automatically, accessible from anywhere. Staff use Yealink desk phones, or the mobile/desktop app. No physical PBX box on the wall.

This makes sense when:

• Your existing PBX is old (10+ years) and needs replacing anyway
• You want to add features your current PBX doesn't support (AI receptionist, Teams integration, advanced analytics)
• You have remote or hybrid workers who need to use their business number from home or mobile
• You want one bill and one support contact for everything
• You're starting a new business or moving office

Cost Comparison

Which Is Right for You?

The honest answer: if your PBX is more than 7–8 years old, hosted VoIP will almost certainly work out better long-term — even if SIP trunks seem cheaper initially. An ageing PBX will need repair and eventually replacement anyway, and you'll face another migration. Doing it once, properly, is more cost-effective.

If your PBX is modern and well-configured, SIP trunks are an excellent, cost-effective bridge to the 2027 deadline — and you can always migrate to hosted VoIP later.