In this article, we’ll break down these differences between Cloud PBX vs SIP Trunking in straightforward terms, answer the questions your team is asking, and give you a practical framework to decide which option fits your business needs in 2026. Whether you’re a startup, a growing company with an existing PBX, or an enterprise evaluating long‑term voice infrastructure, this is for you.
In this article:
TL;DR: Cloud PBX vs SIP Trunking
- Cloud or Hosted PBX is ideal when you want a provider to fully manage your phone system in the cloud, while SIP Trunking is better when you already have a PBX and just need voice connectivity.
- Cloud PBX offloads the technical burden and typically comes with bundled features and per-user pricing, making it attractive for smaller teams or remote-first businesses. SIP Trunking, on the other hand, gives you more control over your setup, often at a lower cost per call or user at scale, but it requires more IT involvement.
What Is Cloud PBX?
Cloud PBX is a phone system hosted by a provider in the cloud, so you don’t need to install or manage PBX hardware on-site. Your team connects using IP phones, desktop apps, or mobile softphones, and everything is maintained by the provider.
How Cloud PBX Works
Cloud PBX (also called hosted PBX) replaces traditional on-premise systems with a software-based solution managed off-site. It runs in the provider’s data center and connects to your phones over the internet. That means no servers, no SIP trunk configuration, no updates to install — your provider handles it all.
All you need is an internet connection and devices (physical IP phones or apps). Calls, voicemail, IVRs, call queues — it’s all delivered from the cloud with high availability and built-in redundancy.
What are the Main Features of Cloud PBX?
Most cloud PBX platforms offer:
Auto-attendant / IVR menus
Extension dialing
Call forwarding and routing
Voicemail to email
Call recording
Queues and hunt groups
Unified Communications (UC) tools like messaging, video meetings, and team presence
These features are typically easy to configure via a web dashboard, with no need for CLI or PBX-specific expertise.
What’s the Pricing Model of Cloud PBX?
Cloud PBX is usually priced per user per month, with tiers based on features (e.g., standard vs advanced). Plans often bundle a certain number of local and international minutes, plus UC features like SMS or meetings.
This model offers predictability, but may become costly for larger teams or businesses with high inbound/outbound volumes and minimal feature needs.
What Is SIP Trunking?
SIP trunking is a way for your business phone system (PBX) to make and receive calls over the internet instead of through traditional phone lines. It uses the Session Initiation Protocol (SIP) to create virtual “trunks” that connect your phone system to the public telephone network.
How SIP Trunking Works
It’s easy to understand how SIP Trunking works: basically, it replaces physical telecom circuits (like ISDN or PRI lines) with virtual communication channels that ride over your internet connection. The “trunk” is essentially a bundle of digital lines; similar to traditional trunks, but instead of copper or physical circuits, these are internet‑based.
When you place a call using SIP trunking, your PBX sends the call request over your IP network to a SIP trunking provider. The provider then routes the call to its destination, whether that’s a landline, mobile phone, another VoIP user, or even internationally via the traditional public switched network (PSTN).
What are the Benefits and Features of SIP Trunking?
These are the main benefits of implementing SIP Trunking in your business:
Multiple concurrent calls over a single internet connection
Elastic capacity, scaling channels up or down as needed
Integration with existing PBX or UC systems
Support for global phone numbers (DIDs)
HD voice quality and advanced codecs
These virtual trunks work with your IP‑enabled PBX, whether that PBX is on‑premises, virtualized, or cloud‑hosted, giving businesses flexibility in how they manage their voice infrastructure.
What is the Pricing Model of SIP Trunking?
SIP trunking pricing depends on how you scale and use channels rather than per physical line. Typical models include:
Per concurrent call channel: you pay for the number of simultaneous calls you need.
Per‑minute or usage‑based billing: especially for international calls or high‑volume outbound traffic.
Elastic or scalable plans: let you adjust trunk capacity without long‑term commitments.
Unlike Cloud PBX, which usually bundles features into per‑user monthly plans, SIP trunking pricing is more usage‑driven and can be highly cost‑efficient at scale.
Key Differences Between Cloud PBX vs SIP Trunking
Below, you will find a quick summary of the differences between Cloud PBX vs SIP Trunking and then you will find a break down them:
| Category | Cloud PBX | SIP Trunking |
|---|---|---|
| PBX Ownership & Management | Fully managed by provider | Owned and managed by your IT team |
| Infrastructure & Deployment | Hosted in the cloud, minimal setup | On-prem or virtual PBX; more setup effort |
| Pricing Model | Per-user/month with bundled features | Per-channel + per-minute usage, scalable |
| Features & Integrations | Standard UC features, limited customization | Highly customizable via your PBX platform |
| Scalability & Remote Work | Easy to scale, remote-first by design | Scalable with planning; VPN/SIP routing needed for remote |
| Reliability & Support | Provider handles failover and support | You own uptime, redundancy, and support response |
Who Owns and Manages the PBX
With Cloud PBX, the provider owns and maintains the PBX software and hardware. You access it remotely via apps or IP phones, and the provider handles configuration, updates, patches, and scaling. Your team only manages the user-facing side, like setting up extensions or voicemail rules.
With SIP Trunking, your organization owns and operates the PBX, whether it’s a physical device or virtual system like FreePBX, 3CX, or Asterisk. This means you’re responsible for maintaining it, ensuring uptime, applying updates, and managing call routing. The SIP trunking provider only supplies the connection to the outside world.
Infrastructure and Deployment
Cloud PBX requires no on-site infrastructure beyond IP phones and a stable internet connection. All core systems live in the provider’s data center (or public cloud), and you simply plug in users via web portals or softphone apps.
SIP Trunking, on the other hand, integrates with your existing PBX setup. That could be a rack-mounted IP PBX at your office, a virtual instance in your data center, or even a PBX hosted in your own cloud environment. Setup requires SIP trunk configuration, codec alignment, NAT traversal/SBC planning, and potentially porting numbers from legacy lines.
Pricing and Total Cost of Ownership
Cloud PBX is typically billed per user, per month, and often includes features such as voicemail, conferencing, and a block of minutes. This model offers cost predictability, especially for smaller teams, but can become expensive for organizations with many users and low call volume.
SIP Trunking usually charges based on:
Number of concurrent call paths (channels)
Call usage (per-minute)
Optional add-ons like emergency services, fraud protection, and number hosting
Features and Integrations
Cloud PBX solutions usually come with a standard set of features baked into their plans — like IVRs, voicemail-to-email, call recording, call queues, team messaging, and video meetings. These are typically designed for ease of use and accessed via a centralized admin dashboard.
However, integrations can be limited by the provider’s ecosystem. If you’re using a popular CRM or helpdesk platform, integration is likely supported. But if you need highly customized workflows, APIs, or integration with niche systems, your options may be constrained by the provider’s roadmap.
SIP Trunking, paired with your own PBX, allows for far more customization. You can choose a PBX platform based on integration needs. We can recommend 3CX, which also has a free version.
Reliability, Support, and Risk
The key risk difference is this: Cloud PBX shifts responsibility outward, while SIP trunking keeps it in-house. That choice depends on your internal capabilities and appetite for ownership.
With Cloud PBX, reliability is largely in the hands of your provider. A good vendor will offer redundant data centers, automatic failover, and built-in SLAs. But you’re also trusting them with your core communications stack.
With SIP Trunking, you’re in control of the PBX. You get full visibility and can build redundancy and failover routes yourself, but it’s your IT team who answers the phone if something breaks.
When to Choose Cloud PBX vs SIP Trunking?
If you want simplicity, speed, and minimal maintenance, Cloud PBX is usually the better choice; especially for businesses starting fresh or lacking internal IT resources. If you already have a PBX or need more control, customization, and cost efficiency at scale, SIP trunking is often the smarter path. Below, we break down when each setup makes the most sense.
When to Choose Cloud PBX?
Cloud PBX is the better choice when you want simplicity and low maintenance. It’s ideal for businesses that:
Don’t have a PBX already and don’t want to manage one
Need to get up and running quickly with minimal IT involvement
Have limited or no in-house telecom expertise
Are remote-first or have a distributed workforce
Prefer predictable, per-user pricing
When to Choose SIP Trunking?
SIP trunking is the smarter choice when you already have a PBX or want control over your telecom stack. It’s a better fit if your business:
Has invested in an on-prem or virtual PBX and wants to keep using it
Has an internal IT team capable of managing systems and SIP routing
Makes a high volume of outbound calls (cost efficiency at scale)
Requires advanced routing, compliance workflows, or integrations
Wants flexible pricing with per-channel or usage-based billing
Use Cases: Cloud PBX vs SIP Trunking?
We’ve explored many discussions across forums and community threads to identify the most common business use cases. Here’s a breakdown of when Cloud PBX vs SIP Trunking tends to be the better fit
Scenario 1: Small Office with “Just Enough” Requirements
A 20-person office using a basic ISP-provided phone service. They need an intercom, voicemail, a few call queues, and occasional call transfers. The office manager is now also the unofficial IT lead, and there’s little appetite for managing infrastructure.
Recommendation:
Go with Cloud PBX. It offers exactly what this team needs — no setup headaches, minimal overhead, and remote-friendly tools like mobile apps. A provider-managed system will deliver far more capability and reliability than trying to DIY with an old on-prem box or open-source PBX.
Scenario 2: Mid-Sized Company with Existing PBX and IT Team
A regional company with 150 employees and an on-site PBX they’ve maintained for years. Their IT team is comfortable managing infrastructure and SIP, and the business wants to optimize for long-term cost savings — especially for frequent outbound calls.
Recommendation:
SIP Trunking is the better move. It extends the life of their existing PBX, offers more favorable pricing at this scale, and lets the IT team retain control. If the PBX is stable and integrates well with business tools, there’s no reason to rip it out.
Scenario 3: Remote-First SaaS or Services Business with No PBX Today
A 40-person remote-first company running customer support and sales through softphones. They’ve never had a physical office or PBX and need to onboard and manage users across multiple time zones quickly.
Recommendation:
This is a classic Cloud PBX situation. UCaaS features like presence, call analytics, and integrated messaging are built for remote teams. No hardware, no VPNs — just a centralized web dashboard to manage everyone’s access and call flow.
Scenario 4: Multi-Site or International Enterprise
A 500+ person company with a main office running an IP PBX and regional branches across three countries. Each branch has different needs — some use softphones, some prefer local DIDs, and there’s a mix of IT capabilities.
Recommendation:
Go hybrid. Use SIP Trunking at headquarters to feed the core PBX, and deploy Cloud PBX or softphone endpoints at smaller branches. The key is unifying everything under a single infrastructure provider to simplify routing, billing, and number management across locations.
Scenario 5: Highly Regulated or Data-Sensitive Organization
A healthcare company handling sensitive patient data or a financial services firm subject to compliance frameworks. Call recording, access controls, and audit trails are critical. Onboarding is slow and controlled, and their IT department needs full oversight.
Recommendation:
SIP Trunking offers the control and auditability needed in regulated industries. By pairing SIP trunks with a compliance-ready PBX, they can meet industry requirements without relying on opaque cloud vendor policies or shared multi-tenant platforms.
Network Quality: The Non-Negotiable for Both Options
Whether you choose Cloud PBX vs SIP Trunking, your call quality depends entirely on your network. Here’s what you need to consider:
Latency, Jitter, and Packet Loss
Latency is the delay between speaking and hearing. Anything over 150ms becomes noticeable.
Jitter is variation in delay, causing choppy audio or missing syllables.
Packet loss is when voice data gets dropped entirely, resulting in cutouts or robotic-sounding audio.
For VoIP to work well, your connection needs to be consistent and stable — not just “fast.” A 300 Mbps internet plan with frequent jitter is worse than a 20 Mbps fiber line with clean routing.
The Role of the Internet Connection
For Cloud PBX, your phones connect directly to the provider over the public internet. That means your ISP’s reliability, routing paths, and peering relationships directly affect voice quality.
For SIP Trunking, calls usually go from your PBX to the provider over IP — sometimes over the same public internet, sometimes via a private or dedicated link (depending on the vendor).
In both cases, voice shares bandwidth with everything else, which makes QoS (Quality of Service) and bandwidth prioritization essential.
SIP Trunking via ISP vs OTT Providers
Some businesses get SIP trunks bundled from their internet provider. Others choose OTT (over-the-top) SIP providers, who deliver trunks over any broadband connection.
ISP-bundled SIP may offer better routing and lower latency if optimized locally — but often comes with poor transparency, long contracts, and limited flexibility.
OTT SIP providers give more control, clearer pricing, and global reach — but require you to manage the quality of your own internet connection and edge routing.
Whichever route you take, monitoring tools, SBCs (Session Border Controllers), and proper network setup are critical for consistent call quality — especially in larger or multi-site environments.
Why Companies Choose Telxi for SIP Trunking?
When businesses choose SIP trunking, they need a provider who offers global reach, reliable connectivity, and real-time control. Telxi delivers all of that, with the transparency, flexibility, and infrastructure-first approach that modern IT teams value.
What Telxi Offers:
Elastic SIP trunking with no channel limits or overage penalties
Global phone numbers and toll-free DIDs in 140+ countries
Real-time provisioning via API or user-friendly portal
Advanced call routing, number masking, and disaster recovery options
TLS/SRTP encryption, IP whitelisting, and fraud controls
Direct integrations with PBX platforms like 3CX, Asterisk, FreePBX, Microsoft Teams
Transparent pricing with per-minute rates and no long-term contracts
Dedicated support from VoIP infrastructure specialists
FAQ About Cloud PBX vs SIP Trunking
- What is the difference between Cloud PBX vs SIP trunking?
Cloud PBX is a hosted phone system provided and managed by a vendor, giving you user extensions, IVRs, call routing, and UC features without owning hardware. SIP trunking connects your own PBX — whether on‑premises or virtual — to the public phone network over the internet, enabling voice calls via IP without replacing your phone system
- What is the difference between Cloud PBX and VoIP?
Cloud PBX uses VoIP technology to deliver calls, but it’s a complete hosted phone system — including call management features — delivered as a service. VoIP itself is the underlying technology for transmitting voice over IP and can include many services beyond Cloud PBX or trunking (such as softphone apps or app‑based calling).
- Do I need SIP trunking with Cloud PBX?
Most Cloud PBX services already include the trunking layer under the hood — so you typically don’t need to purchase separate SIP trunks. However, if you want to bring your own carrier or connect additional numbers or routes, a separate SIP trunk can be used with compatible Cloud PBX systems.
- Which is cheaper: Cloud PBX or SIP trunking?
Pricing depends on usage and scale. Cloud PBX typically uses per‑user monthly pricing, which is predictable and easy to budget for small to mid‑sized teams. SIP trunking is often more cost‑efficient at scale or with high outbound volume because it bills based on channels and usage instead of per user.
