Though the terms SIP and VoIP seem to be used interchangeably, the two are actually different kinds of IP technology. Session initiated protocol (SIP) is a communications protocol that allows all forms of media to be transmitted, including video and images, using a code-based system. Voice-over-internet-protocol (VoIP) depends on the internet to send voice messages and does not transmit media on its own.
What Is the Difference Between SIP & VoIP?
The main difference between SIP and VoIP is how calls are transmitted. VoIP calls are made and received through the internet or internal networks. On the other hand, SIP is a coded system. It uses what is called the Unicode Transformation Format (UTF), a text-based protocol, as well as 8-bit blocks to transmit communications. It allows users to send pictures, videos, text messages, and any other kind of media, but can require additional equipment.
It is worth noting that SIP and VoIP do not necessarily work independently of one another at all times. In fact, the two often work together as components of robust business phone systems. For example, SIP allows digitized softphones to connect to traditional telephone networks. VoIP also transmits calls, but places less strain on network bandwidth. The two work in concert to help your company handle all call traffic effectively and easily.
SIP vs VoIP at a Glance
Enables Voice Calling
Transmits Media Messages (e.g., Video and Images)
Requires a Network Connection
Does Not Need Additional Hardware
Supports Mobile Calling
Fixed Monthly Pricing
When to Use a SIP-based PBX System
SIP is set up like a traditional phone system, meaning that it consists of two parts: the private branch exchange (PBX), which is the on-site system that manages your calls, and the primary rate interface (PRI), which connects your calls to the public switched telephone network (PSTN) and will ultimately route them to the correct destination through a process known as SIP trunking.
Large companies that have a high call volume, many users, and which transmit various kinds of data are the best audience for a SIP system. With the recent rise of remote workers, SIP services are becoming a more popular option because of their video conferencing and multimedia capabilities. Businesses with several branches and locations are the preferred SIP users.
When to Use a VoIP System
A VoIP system is the better option for smaller businesses than SIP-based PBX systems. This is because while SIP transmits visual and audio data, a VoIP system only requires an internet connection, making it less complex to install and maintain. Also, VoIP systems can be integrated with additional cheap or free services for video conferencing or multimedia messaging.
We arrived at this recommendation based on the following in-depth comparisons:
SIP vs VoIP: Setup & Maintenance
When deciding whether to go with a SIP or a VoIP system, take into consideration how easy or difficult the system will be to set up, use, and maintain over time. A phone system that will last for many years without much maintenance is ideal for any business owner, but especially small business owners lacking a dedicated IT or networking team.
SIP Setup & Maintenance
SIP phone systems require a modem, a computer, or a special SIP telephone. Softphone calls can be made as well, but ensure that you’ve connected all SIP devices to your network if you plan to use that feature.
Setting up your SIP system requires you to create information such as an SIP user ID and work with proxy settings within your router. Since networking and configuring code is not easy for all individuals, it is a wise idea to have a networking team on hand to help guide you through the process. This team should also be able to maintain and update software and hardware over time to keep it properly configured and functioning.
VoIP Setup & Maintenance
Beyond an internet connection, there is no special hardware that you must configure to make a VoIP connection work. In most cases, you can simply plug in your phone to your Ethernet system or connect your existing smartphone to the network. Generally, the process of choosing a new provider is more difficult than the VoIP setup itself, especially if you are a tech-savvy individual.
You can choose to rent additional equipment, such as headsets and telephones, from your provider, but this is entirely optional.
SIP vs VoIP: Features & Benefits
Although the two are similar, it’s worth comparing the features of both SIP and VoIP to decide which works best in your environment. It might surprise you to learn the benefits and drawbacks of each.
SIP Features & Benefits
A huge benefit of SIP calling is its price. SIP-to-SIP calls are absolutely free, meaning that there is no charge for any minutes used—even if it’s an international call. This means that you are charged nothing for calls that could potentially cost hundreds of dollars when all is said and done. Additionally, SIP services save you money because you are not paying for multiple subscriptions or network fees; all multimedia communication is included with the service.
Scalability is another great SIP feature. As your business grows, so can your phone plan. Add phone channels one at a time, saving you from spending too much on unnecessary or unused lines and extensions.
Finally, SIP phones give you exceptional sound quality. Frequency range is heightened due to the use of HD voice or wideband audio, providing a clearer, better sound at the other end of the line.
VoIP Features & Benefits
It’s very easy to get started with VoIP, and an almost instant setup is one of the most attractive parts of VoIP services. For example, once you’ve registered with RingCentral, you can immediately download the mobile or desktop apps to get started making configurations. This is handy for individuals who are eager to get started tweaking their settings.
Though VoIP services do not transmit multimedia the same way that SIP services do, it is very easy to obtain and use those features outside of your VoIP service. Many times, the mobile app includes additional communication methods such as SMS texting and video conferencing directly from your smartphone; as long as you have an internet connection, you can use those additional features.
Pricing is another feature that VoIP users enjoy. Service packages are set at a fixed price, generally charging per user on a monthly basis. When you look at the pricing and features of your phone plan, you can see upfront what you will be charged and which services you are paying to use. Knowing how much you can expect to spend on phone services per month is highly useful, preventing you from guessing how much you might spend.
Pros & Cons of SIP vs VoIP
Despite the features and convenience of both SIP and VoIP services, there are pros and cons to each. Weighing the pros against the cons will help you to better decide which is the right service for your company.
Pros & Cons of SIP
Cheap to free: With SIP-to-SIP calling costing nothing, you don’t need to worry about spending too much money on minutes, even after an international call
Security holes: Because of its text-based protocol, hackers can more easily get into SIP systems
User-friendly: Rather than train your employees on several devices, teach them to use one simple SIP phone
Shared bandwidth: Since multimedia is transferred via SIP, shared bandwidth can cause bottlenecking during peak times, which can contribute to poor sound or voice quality
Work without the internet: If there’s an outage, no need to fear—make use of your phone system without an internet connection
Power outages: Unfortunately, there is no power source if the electricity goes out; if you lose power, you will also lose your phone connection
Pros & Cons of VoIP
Portable: Unless you choose to rent optional office equipment, your VoIP phone can go with you wherever you’d like
Internet connection: You must have a stable, reliable internet connection to get the most from a VoIP service; if internet service is spotty, your phone service will be too
Security: Encryption protocols are built into VoIP technology, making your conversations much more secure
ICE location tracking: Portability can be a con as well as a pro; if there was an emergency while you were out on the road, emergency services could potentially have a difficult time locating you
Auto-attendant: Virtual receptionists guide callers through the phone menu, including voice prompts, holiday or business hours, and other valuable information
Power: As with SIP, the issue of no power means no telephone service for VoIP phones
Frequently Asked Questions (FAQs)
Are SIP & VoIP the same thing?
No. They are similar, but they are not the same. SIP technologies can be used to maintain and support VoIP and they often work in tandem, but they are two different systems.
Can I make SIP & VoIP calls for free?
That depends on which softphone service you choose. Some services (like Google Voice and OnSIP) have a free plan available, only requiring you to register for an account on the website. Additionally, SIP-to-SIP calls are free, which means that if you place a call to another SIP telephone, you are charged nothing.
What is a PBX System?
A private branch exchange (PBX) is a private telephone network used in an organization or business. It allows users to connect internally and externally, allows free calls between users, and provides additional features like voicemail and call recording. A PBX system is required to use a SIP phone, but it is not required for a VoIP phone.
When it comes to a phone system, it’s unlikely that any modern business is going to focus solely on a landline anymore. SIP and VoIP phone systems are highly intuitive and easy to use, streamlining your business’ communication needs into one service.
If you are looking to make the switch from SIP to VoIP, we recommend taking a look at RingCentral. The service is our pick for best overall small business VoIP system because it is powerful, affordable, and exceptionally easy to use. They also offer a free trial so that you can try it out for yourself. For more information, click the button below.